Hi, I have not been on the Forum for a while but I am struggling with this question so hope that someone can give me some advice.
My client has recently moved premises and they had a "Dilapidations Accrual" in their accounts for £20000 which had been accrued for when they moved.
Now the move has taken place there have been a number of expenses incurred such as employing a handyman to install a kitchen. Installation of cables, phones, a security alarm etc.
The MD wanted these costs to be offset against the Dilapidations Accrual. I have posted them to the actual accrual nominal on Sage but this does not seem right to me. Should I have posted them to each individual nominal and then reversed that part of the Accrual or something.
I'm a bit stuck on this and hope someone can help me.
With a dilapidations accrual, I would normally assume that this related to the former premises (i.e. that the business had an obligation under the lease to return the property to an agreed condition and this accrual was the estimate of the costs of doing so). If that's what the accrual is for, then you wouldn't release it against expenditure on the new premises.
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Pearce & Co - Chartered Accountant and Chartered Tax Adviser
It occurs to me that I may need to post these transactions back to the individual nominal accounts and then let the accountant deal with the adjustments? Probably safer!! Sue
