I will third that.  Dont' know why you would do that.  If you pay distributions to use up their basis, and the next year they incur a loss, you have no basis to absorb that loss and they then are not allowed to take that loss on their Form 1040.  I think you may have a capital gain situation then too.   You are aware of the "Reasonable Compensation" requirement that SCorp Owners need to pay themselves via W2 wages?  If the IRS sees that large distributions are being paid out and a reasonable wage is NOT they can assess the distributions as wages, which includes the requirment for payroll taxes, which at that point the SCorp is late in paying and is assessed penalties and interest on that.  

I don't think SCorps have the restriction on how much they can accumulate in Equity like C Corps do.  So there is no penalty for the Shareholder to leave the money in the SCorp, they've paid the tax on the net income already.  Take the distributions if they need to, but if there is no money in the bank to actually pay it, don't know why you would accrue it as a payable.  I guess another question would be how many shareholders are in the SCorp and does the operating agreement call for this? or for a certain amount to be distributed to a certain Shareholder?  If not, I wouldn't do it.  If the operating agreement does state this, it should be re-evaluated, if the distributions are leaving no cash left in the bank account it doesn't really look good for the SCorp or for the Shareholder.

 No money in the bank and an accrued payable for distributions to the Shareholder would seem to me that the SCorp and/or the Shareholder were in financial trouble.  No money in the SCorp bank to pay the company expenses, but you book a distribution to the Shareholder?   Pay a reasonable W2 wage and then pay distributions if the profit warrants it, but should be keeping some money in the bank for the company's future expenses and to further grow the company.