I wa approched recently by a small charity to do their books for them, however the problem is that they don't have any system of recording expenses in place.
They want me to start this from scratch as they, I dont have any exprience in setting up systems at all as have always worked for large organisation and with ready setup systems.
can any one advice on what needs to be done, from what I have gathered most of their outgoings are expenses and incomes is donations how do I treat them.
We have approched an accountant he is charging quite alot.
Incomes you should put as something like grants and post them (in sage) to the 4000 range as income and expenses as usual in the overheads etc. I work for a company that works off revenue and capital grants from various local and central governments and we always put them in the sales section ( where else :)) the rest of it is as normal.
In a nutshell your income (loosely considered sales in your case even though they are donations it's the same thing, it's people giving you money) should be shown n the P+L and your outgoings (non of which are likely to be considered cost of sale more likely overheads i.e you would be paying them out regardless) should also show in the P+L. If you have any assets then you should have or can get a record of these plus any depreciation from the accountant. In another nutshell the accountant they have been using should provide you with a balance sheet, P+L etc showing exactly where the charity lies as from their last year end, then all you need to do is add in income and expenditure and you will be able to do the bookkeeping side. If you understand the rules concerning not for profit organisations and know what necessary forms to fill in to satisfy the HMRC then you should be able to then extend the role to accountant. If you just want to save them money then doing the bookkeeping to P+L and Balance sheet level should be enough to save them a few pounds, something that should be easily achievable via a bit of googling or asking on here.
