I've just started book-keeping after a few years of not doing it and i could really use some reminders / reassurance to refresh my memory!
I also have a few queries if anybody could help.
1. I inputted all the sales invoices and then paid the invoices as they appeared on the bank statement however when I went to reconcile the bank account they weren't there? I think I may have forgotten to change the payment date so it defaulted on the date I was doing it but I just can't think why they would not be there.
2. There is a large supplier where they send monthly statements and I inputted all of the invoices. There was a payment made but it didn't add up to the invoices (there are lots of outstanding invoices from when I took over) so I just made a payment on account. Is this ok to do this? What happens to all of the invoices - is it ok for them to just sit there?
Is this the best pattern of working;
input sales invoices
input purchase invoices
pay the invoices as they come and go in the bank statement
reconcile bank to the latest statement
Or would you pay purchase invoices as soon as you enter them?
Hi Lauren, it sounds like your customer is like one of mine! Here are some ideas which might help, but I stand to be corrected if anyone has better ones!
1. I presume you are entering the transactions retrospectively, so yes, if you forgot to change the posting date, your payments wont be there. You could go into a couple of the customer accounts and check there what date you entered as the payment date so that would help you figure out whats gone wrong. If you have backed up at the end of each week or month, you could always restore the work done up until you entered the receipts, and re-do them again, however it depends on how far you have gone on since then....
2. It's ok to enter a POA, however my thinking is that you don't want it left there too long - it is much clearer if it is allocated to the correct invoices. Nothing will happen to the invoices unallocated, however if you run an Aged Creditors report for your customer, or submit the accounts to an accountant at the year-end, these invoices will show as outstanding still, which could result in the supplier being paid a second time.
With regards to the working pattern, it doesnt really matter whether you do purchases or sales first, however I would suggest you do a month at a time - this way you can get everything up to date by the end of each month including bank rec. Just a thought - I find it easier this way then I don't have to trudge through loads of transactions to find something from near the start.
Hi, Thank you for your replies. I am using Sage instant accounts (I'm used to using Sage line 50) Can I find the transactions that I paid with the wrong date and delete them in file maintenace and start again? I presume that they should still be in the bank rec outstanding items even with the wrong date on them? As they are not...
Yes you can delete the transactions in file maintenance (or using "corrections" in the Financials tab aswell) - if you have allocated the payments to the invoices, and delete the payments, the invoices will become outstanding again as if you had never allocated them in the first place. You can then start again, but remember to put the correct posting date!
Can I do anything about the outstanding supplier invoices now so I can start afresh? There are some outstanding from June which I now have been cleared already but as I said, I couldn't get the payment amount to add up to the outstanding invoices that were there but I don't like doing payments on a/cs. Problem is now there are more outstanding invoices. I guess this is a common problem when you are taking over but I'm just trying to get everything up to date and would like it all to be as tidy as possible!
Sometimes feels likes tidying up after four year olds doesn't it!
Don't stress, take to the DLA.
If not repaid by the period end then convert to salary or dividend (assumn that there are sufficient current year profits or retained profits for a dividend), or smply pay the periods final months salary to the DLA.
keep the director informed of what you have done and emphasise that there may be tax implications of failure to repay the DLA.
All in all nothing really to worry about except that the director is treating the business as a personal piggy bank so breaking down the veil of incorporation but the likelihood of that being taken up on by the authorities is remote except in insolvency scenarios.
HTH,
Shaun.
p.s. amended only for spelling
-- Edited by Shamus on Tuesday 16th of July 2013 10:02:47 PM
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Please can someone give me help me what should I do?
My director was taking cash out from the company current account constantly in the last 2 months,and I was asking him to arrange this outstanding debt because he doest have receipt for this amount- so he said yes but he always delaying to pay it back weeks and weeks now,...
I`m not sure what should I do now,clearly he dosent wanna pay it back..-this my responsibility to keep control of this petty cash float,,
In that case the owner of the company may wish to know immediately about the withdrawal of funds from the company by an employee.
Best that you can do in this instance for bookkeeping is treat as an advance on the directors salary.
As mentioned above though a director who is not an owner is just an employee and has no right to take funds personally to which they are not entitled and the only person to report that to is the actual owner of the business who may need to put better internal controls in place to prevent unauthorised personal access by employee's to company funds.
kind regards,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Really? I can take off from hes salary? He won`t be impressed and happy at all! He has said will do a bank transfer to pay back the outstanding amount on Friday but he didn`t.
Also he is paying for petrol with the company card for hes personal car to use-no idea how can I record this in sage!-as you mentioned earlier ,he is not entitled to take funds or anything like this personally...
Many thanks again for your kind advise-very very helpful
I've done it before where a director has x amount transferred to his private account when they should have had y amount.
The guy came storming into the office about underpayment and me being some incompetent halfwit etc.
"Oh" says I "I can only appologise and lets have a look at the amount of any underpayment and we'll get it sorted straight away".
Slightly calmed director.
"Mmm, x amount taken on such and such a day from petty cash, y amount transferred on this day, oh, this is the non business phone that you bought for your daughter here... No, unless there has been a change in salary that hasn't filtered through to me it all seems to have been paid correctly... Maybe there's a problem with the bank?".
The next part involved directors moving mouth with no words coming out.
lol.
Actually, it might help that I'm six foot and not an insubstantial fella so don't get intimidated by clients throwing a hissy fit (#1) but if you are at all worried about impossing deductions on salary try to ensure that you have someone else to hand as for some it can feel quite threatening when clients get irate and start having tantrums.
Also, do you have access to the owner of the business as they will want to know what is going on here.
kind regards,
Shaun.
#1 but I do have a great deal of professional pride and give myself a far worse time than a client ever could if there is even the smallest error in my work.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Also he is paying for petrol with the company card for hes personal car to use-no idea how can I record this in sage!-as you mentioned earlier ,he is not entitled to take funds or anything like this personally...
But because they are a director and seeing the company as a personal piggy bank I'll have money on it that they are just not seeing the reality of what they are doing which is why I ask whether Sandra has access to the owner of the business.
Only possible way to sort this out short term is to treat everything, cash taken, benefits consumed, etc. as an advance on salary... Well, suppose that it could all be put down as a BIK but thats not going to prompt the director to stop what they are doing if one defers the effect of this.
The slap on the wrist really needs to come from the owner, not the bookkeeper.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
I personally would set up a loan account for the director anyway, and post to that. After all it is a directors loan account. Just like the company might loan money to any other employee. There may be a BIK created too. The majority owners may have something to say when they see it sitting on the balance sheet
I wouldn't deduct it from normal PAYE salary, as you need prior written agreement before making deductions, unless they are statutory, or court orders.
"#1 but I do have a great deal of professional pride and give myself a far worse time than a client ever could if there is even the smallest error in my work." I am exactly the same, even the smallest error makes me break out in a cold sweat.
What's the saying? "You get experience from making mistakes, and boy, have I got a lot of experience"
Wella wrote:What's the saying? "You get experience from making mistakes, and boy, have I got a lot of experience"
All that I'll say is that before everything got shipped off to India to mess up thank goodness there were months of testing on UK banking systems before anything was allowed to go live.
Even after that though in my careeer there has been one quite spectacular live failure (not my coding but my system so it was on my watch) where one client had more than 500 bank accounts and it blew a new system change quite spectacularly (but not until several processes after the damage had been done).
Cost a small fortune to fix and involved my entire team working day and night all weekend.
They reccon management are supposed to think outside the box but senior management frowned upon my suggestion that in my area it only costs £500 to have someone shot and it would be a far cheaper and simpler sollution for an occurance unique to the system.
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
"#1 but I do have a great deal of professional pride and give myself a far worse time than a client ever could if there is even the smallest error in my work." I am exactly the same, even the smallest error makes me break out in a cold sweat.
What's the saying? "You get experience from making mistakes, and boy, have I got a lot of experience"
Bill
Ha ha Bill, a man after my own heart.
I would be inclined to open a DLA for the director as well and post all to this, but I would definitely bring this to the attention of the owner of the business, after all, they may be blissfully unaware.
Well Shaun - I`m not like you - `six foot and not an insubstantial fell`-so maybe that won`t help me in this occasion ;)
But yes I have access to the owner of the business.
So before I will deduct it from the directors salary should I talk with the owner first as I need prior written agreement before making deductions?-as Bill mentioned above.
Also plenty of receipts/invoices missing-get lost all the time-very annoying!
So what happens if the issue between the owner and myself cannot be resolved-is there any proceed for this to follow? I assuming the director won`t like me after all this conflict then I may have no option but to offer to resign..
Just picked up on this post and wanted to contribute to agree with postings above..
Easiest solution is to post everything that this director is drawing down, ie cash payments, petrol payments and basically anything without a receipt straight to a separately identified directors loan account.
I always found that the best way to get receipts / invoices to appear was to say that transactions like this will have to go to DLA with no VAT reclaim - they then become aware of the need to provide backup to their expenses..... otherwise they are paying privately and are not getting the VT back.
The owner should then be made aware of this loan to this director along with the list of transactions which could be easily analysed as a separate account.
It may be that the owner has authorised this, but the repayment can only be made by a salary adjustment or a repayment by the director. This is a decision which they have to make, not you.
If it carries on and the owner was not aware, then they may ask you why you never mentioned it....
Hope that helps
Thanks
Jeremy
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