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To use Sage's terminology, a bank account can be what's called a "floating" account. Normally, you say whether a bank account is an asset or a liability, like for a savings account or a loan, but if you say it is floating, then it appears in whichever section is appropriate, i.e. in the current assets when it is in credit (well, debit, but you know what I mean), and in the current liabilities when it is overdrawn. If you don't make it floating, and say it's an asset, then if it went overdrawn the balance would be shown as negative (i.e. bracketed).
I've not heard of a floating account before. I could see where it may come in handy, but I'm not sure if it's just over-complicating things. Does anyone actually use this method rather than just showing overdraft as a negative asset?
If you use Sage floating accounts are normal for some balance shhet lines unless you change the settings and the layout - so yes they're used all the time
If you use Sage floating accounts are normal for some balance shhet lines unless you change the settings and the layout - so yes they're used all the time
Ability to set up floating accounts is in the chart of account under current assets and current liabilities.
In summary you can set certain accounts to be either shown under current assets or current liabilities depending on if it is a debit or credit balance eg bank account, VAT.
