Marios wrote:

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Hi Joanne and thanks for the response!

Right, so I'm studying ACCA and have sat 4 exams so far and about to sit F5. F1, F2, F3 and F6 done already. So you are very busy away from the office.  Keep up the good work!   I am working for a construction company based in west London. A great industry to cut your teeth on for bookkeeping!!   The other company was owned by the same person and is now dormant but to answer your question, the director holds cards for all companies bank accounts and sometimes uses them randomly !! Sometimes he uses his own as well.  Dont you just love business owners!  Never give a thought to which card they use, although to be fair they all look the same when in your wallet/purse.  The only reason I dont get mine mixed up is because its a different colour to all the rest and kept firmly away from my personal ones.

So he would have been out purchasing materials paying with that other company's cards. As the reconciliation would take place with the bank account of the current company, the unreconciled invoices would not have been picked up. We're coming up to end year now and was trying to sort out the suppliers balances and picked up those invoices that had been paid by that one card. So my manager transferred physically the amount to the bank account that paid for all this. So now I have to find a way to allocate that one payment to all the different invoices and the problem is that they're posted in several supplier accounts. The sum of all them matches the payment of course.

We're using Sage 50 accounts and yes I use sage for the other company although I wouldn't be able to change anything in there anymore, I don't think.

I hope I managed to explain the situation well enough and thank you very much for your help.

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Ok - so first thing I should just drop in there is to say that following the purchase of these items from the so called dormant company, it is no longer a dormant company.  Any movement in the Bank account, even just for charges, renders a company as not dormant.  So for that one I would say, take his card off the boss and get that Bank account shut down.  One for the Accountant to advise him on perhaps.

I am going to assume that all the relevant invoices are in the name of the non-'dormant' company,

There are several ways you can process this one, but for ease (and assuming you do get that card off him so he cant do it again) the easiest way to deal with it given you have actually paid that company back is to do the following:-

Get the Bank statement for the 'dormant' company showing all the transactions.

In the main business sage - set up a dummy Bank account called 'company abc' ie name of 'dormant' company.  

Key all payments to the supplier invoices through this Bank account in the normal way, using the actual dates the payments were made per the 'dormant' Bank account.  This will obviously leave the account overdrawn.

Then on the day the funds were actually moved from the main co to the dormant, just key this as a Bank transfer - but you can alter your narrative to show whatever you need to so that it helps you 6months down the line/the Accountant/matches the paper trail.

Once you have keyed this transfer, you can reconciled the main company Bank account as usual. You can also do a rec on the 'dormant' company Bank, even though it should no be nil, for completeness.  Plus the supplier accounts should be correct.  Care though if he paid for something, didnt get an invoice and just got a receipt. In this case you will not have keyed this to the supplier account, but can just key it as 'Bank payment' to that 'dormant' dummy Bank as usual.

Re the 'dormant' company sage  - the only reason for not keying into this is if your entries are before the year end/you have locked down the year end/after the reports have been given to the Accountant for the year end - if this is the case I would suggest you speak to the Accountant as to a way forward.  Depends on how long ago the year end was/how far the accountant has got and Materiality.  Otherwise you can still key them to that sage.  For that sage  - I would suggest you open up a creditor nominal in the 21xx range, called the name of the main company. Key the items through the normal Bank, as Bank payments, but instead of a cost code nominal, key to that 21xx new nominal.  Then when you come to the funds received from the man Bank, also key this as a 'Bank receipt' to that same nominal - brings it to nil. Job done!

There are other ways if its inter company/part of a group, but the above should suffice as it sounds like they are separate.

Oh and by the way, if you are unsure if this will work, backup, backup and backup again, test your back up works (my mantra is to do this on a VERY regular basis anyway), then have a go and see what happens/check all your relevant accounts with your debits/credits in mind to see if what you wanted has been achieved.  Or try it in the sage practice data module.

HTH