Hi I have a new client which is a Limited company and i have noticed that the bank account is in the Directors personal name (sole trader company) he set up the Ltd co back in July 2012 and has never changed the account details. His previous accountant always showed this account on the balance sheet in the Ltd co accounts, is this okay to do?
If not how do i go about removing it from the accounts, would i have to transfer this over to DLA, and in this current year post all bank receipts and payments to DLA?
By doing this, your director faces personal liability for any cheque he issues that bounces. Waste of time incorporating.
From a pragmatic point of view, you can carry on with the current arrangement, but if you want to do things properly (and perhaps drive home the director's exposure) you could put everything through the DLA as you suggest. Probably best to re-open it with a "bank account" code ... or a new column in your cash book if you're doing it manually!
(I wonder if the bank knows he's incorporated? Do they still think he's a sole trader with personal liability to them?)
Was just thinking the same about the Bank. Suggest to him he can get up to 2 years free banking if he opens a new (Limited Company) Bank account - that might sway him.
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
