my accountant gave me a set of Sage journals to enter to get the year end figures. This included a journal credit for the petty cash account (Sage 1230) for the entire balance. Not surprisingly Sage now shows the petty cash balance as 0. However, in reality I still have physical cash in my petty cash box which I now want to access.
How do I tell Sage that there are funds in the petty cash account? I would guess a journal debit. But then where would the matching journal credit be?
We're not on the best of terms as I have just changed accountant. I can ask the new accountant at our meeting next week but thought I would try and seek guidance here first so I can get my books up to date.
you have totally lost me. Don't know what net journals are. And I don't really know what was in suspense account. I thought I was getting good at basic book keeping. My figures aren't overly complicated. But this has me puzzled. I suspect to get an answer you will need more information, but without giving you my full Sage files (any offers?? :D) I'm not sure what to tell you.
Could the suspense account be the total of the directors loan and petty cash. They don't quite match but there was only 1 accrual, the accountants fees which has been paid in full, 1 corporation tax creditor which has since been paid in full, and I'm not sure about the purchase tax control account. I'm not VAT registered so nothing complicated there.
2201 is probably being used to correct a miposting. If you've accidentally entered the vat element of an invoice, this will put a debit to 2201.
Adjustment 1:
Dr 3200
Cr 2109
Should be the figure for accountancy accrual
Adjustment 2:
Dr 3200
Cr 2320
Should be the corporation tax liability.
If you deduct the two adjustments above hopefully the rest of the adjustments will add up.
(dont worry about net journals, it wasn't aimed at you and just means that the accountant has added the movements together rather than giving the adjustments individually. See the above, do the two debits added together for 3200 equal the total adjustment from the accountant?)
Do you give the accountant a copy of Sage at the year end? Have you run the year end on your copy?
-- Edited by ADAS on Tuesday 27th of September 2011 12:42:36 PM
__________________
Tony
Responses are intended as outline only. Formal advice should be sort from your Institutes Technical Department or a suitably qualified Accountant.
This is just a simple suggestion that might work for you, if your question is only regarding how to show the petty cash still on hand!
Simply credit the amount back out of the capital account and debit into the petty cash account. Since after running your year end it has effectively taken your assest of petty cash and added it to the capital account simply reverse it. That way your capital accounts dont show the amount of petty cash you still have on hand and your petty cash account does.
The way i view it is, as long as you are acting in a way that your are declaring what you have and you feel you are acting in a prudent way then who is to say you are wrong. Accountancy is about prudence and honesty and you are obviously trying to show that.
If ive understood the question right is that a solution???
I was hoping for a simple solution like you suggested, but the capital account has the correct balance. So doing as you suggested would fix the petty cash balance but create an error in the capital balance. There was no year end journal for the capital account.
Adas, I think you are correct about the 2201 being an adjustment. The activity on 2201 still shows a final £5.00 credit but I guess that is another issue.
I totally get the net journal thing now. Yes I hate those too, I can see how logical your method is. And much clearer.
No combination of the 5 credits equals either of the debits. I shall look at the end of year report the accountant gave me.
The accountant did get my Sage files but didn't change anything. Just gave me the journals as I listed to enter myself. I 'think' I ran the end of year procedure.
I have just noticed something. 2100 creditors control account as a balance of xxxCR which is what I would expect the balance of petty cash to be - less 70p for some reason???
No combination of the 5 credits equals either of the debits. I shall look at the end of year report the accountant gave me.
The accountant did get my Sage files but didn't change anything. Just gave me the journals as I listed to enter myself. I 'think' I ran the end of year procedure.
I have just noticed something. 2100 creditors control account as a balance of xxxCR which is what I would expect the balance of petty cash to be - less 70p for some reason???
That could be a coincidence, OR it could be the source of the error and there's a 70p net error elsewhere...
(It's usual/typical for the accountant not to "touch" your Sage file, but just get the bookkeeping data from it - because otherwise, you could end up with two divergent sets of Sage data - the data that you've continued to use on an ongoing basis and the version from the accountant.)
However, merely running the Year End on Sage should not have moved the Petty Cash balance asset to the capital liability code. (The year end procedure on Sage simply clears down the P&L and moves the net figure to the P&L reserve)
Well I took the plunge and mailed my new accountant. Hope I don't get a big fee. He has taken a look at my Sage file. He wanted a quick glance before to give me a quote. It seems the old accountant made a bit of a boob putting this where they shouldn't be!!!! That explains why the numbers don't tally. Hope you don't think I've wasted your time. All your replies have been appreciated.
It seems the old accountant made a bit of a boob putting this where they shouldn't be!!!!
It's possible, they've taken the easier option, decided the adjustments aren't material and just written them off, ultimately, to the Director's loan account for convieniance.
__________________
Tony
Responses are intended as outline only. Formal advice should be sort from your Institutes Technical Department or a suitably qualified Accountant.
