Hi guys, been a long while I'm sorry, life has gotten mad and had me swamped!
Anywho... Took a client on recently who runs a property empire... (ok only half a dozen, but its an empire to me! lol) Thing is I have written to the old accountant now 3-4 times and had nothing from him, emails dont work and nor do calls. My client tells me that they have ceased to practice because of ill health, (they aren't dead don't worry!)
My issue now is what the hell am I to do about the creditors and debtors, I don't know what they are for neither does the client! Every thing else is sound except these two accounts. Creditors has 12k in it and debtors has 35k in it... surely (this is what I'm thinking, correct me if I'm wrong) one can cancel the other out adding a 23k loss to the accounts....
I'm stressing over this guys.... can anyone offer any advice?
I usually put this back to the client, after 3 tries. As its very possible the client hasn't paid the final bill and I wouldn't want to get in the middle regardless.
I normally advise them to give the old acc a call and threaten to report them to their governing body. Works every time :)
No no no! I missed the ill health bit sorry!! Wow I must've sounded really harsh then !!!!
Accountants have to have a continuity agreement in place in order to get licensed. Perhaps somebody will be taking over very soon? I'd be inclined to ring HMRC and companies house and try for extensions on the filing dates in the first instance.
I am using the mobile site here and it's a bit discombobulated ! Bear with me !
Is it just trade debtors and trade creditors that you have an issue with, or is it debtors as a whole and creditors as a whole? If trade - Can you use invoices for the current year plus the bank to roughly work out what must be debtor receipts and creditor payments? So you can take a view? That's a lot to write off without any investigation ?
Can you use invoices for the current year plus the bank to roughly work out what must be debtor receipts and creditor payments? So you can take a view? That's a lot to write off without any investigation ?
I suspect the question relating to Debtors and Creditors relates to balances in the previous accounts prepared by the previous accountant.
If you cant speak to the previous accountant and the client doesnt know what the balances are then if they havent cleared out in the year eg received £35k more cash in than invoices issued, paid £12k more cash out than invoices received then they probably should be written off. If they are valid balances and the client doesnt know they are still due £35k then they arent keeping a proper control on the running of their business.
Hi Mark... Yes absolutely. Balances brought forward. And I suspect it will be trade debtors/creditors not total debtors/creditors - otherwise there would be prepayments, accruals, loans, director acccount etc etc and that would make the task impossible perhaps!
If it's possible to highlight the current year invoices, in and out, on the current year bank statements, at least for the first 3 month, that should leave unhighlighted transactions that may relate to opening debtors and creditors. I'd be totting these up and seeing if they come anywhere near the opening balances.
Another option (sorry brain is working sporadically here!)
if the client has the records from last year, maybe have a look at those? You might be lucky in that, the paid date is written on the invoice, or that there aren't very many invoices included in those balances and you can work it out that way?
Sorry guys got them mixed up, 35K TO PAY and 12k DUE. My brains not working either! lol
I can hazard a guess as to what they might be... 35k is mortgage interest for the year and the 12k owing is rent due for the year... I will have to ask client. I have a meeting with them tomorrow so fingers crossed!
