The bills will show an actual amount charged, as well as any payments made.
In most cases, I find it's best to enter the charge amount as a supplier invoice, with the payments as payments against it. Amongst other things, that means you can verify the final balance - the balance on the account should be (or be able to reconcile to) the balance on the bill.
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Vince M Hudd - Soft Rock Software
(I only came here looking for fellow apiarists...)
Hi Dave
Think - for EVERY transaction you need a bit of paper as proof and you wont go wrong!
A client of mine (before they were a client) had not been getting their invoices from a certain scottish power company - turns out the meter reader had swapped the meter readings round from another building and they had been overpaying. Finally got it sorted and they have had £3000+ refunded - about 18mths worth of power!
How can you know what the VAT element is if you dont have an invoice, especially for lecky which can be sometimes 5% and sometimes 20% dependent on usage?
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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
Hi Dave Think - for EVERY transaction you need a bit of paper as proof and you wont go wrong!
A client of mine (before they were a client) had not been getting their invoices from a certain scottish power company - turns out the meter reader had swapped the meter readings round from another building and they had been overpaying. Finally got it sorted and they have had £3000+ refunded - about 18mths worth of power!
How can you know what the VAT element is if you dont have an invoice, especially for lecky which can be sometimes 5% and sometimes 20% dependent on usage?
You see I'm convinced my boss is doing this wrong (we don't use SAGE though) . but she's never ever usually wrong!
We pay gas/electric monthly by direct debit. The same amount over 12 months. However I enter our readings online every month and we get sent a monthly invoice (less in summer more in winter as is normal). She doesn't enter these amounts on the ledger just the amount that goes out of the bank account each month. I think she should enter the actual invoices up in the ledger and put the monthly payments against that (so some months we would be in credit and some months in debt.)
In theory, posting based on the payments will result in the right amount being charged overall - i.e. when the contract comes to an end, such as if either party shuts up shop, or perhaps when the Sun goes supernova and brings a huge fiery death to the planet.
However, her method means that her accounts are technically incorrect. Her P&L is showing the amount paid, rather than the amount charged/used - and her balance sheet isn't showing the correct amount for either debtors or creditors (depending on which way around this happens). Similarly, the correct amount of VAT isn't being shown at the correct tax point (though whether it affects the actual amount claimed will depend on the basis used - on a cash basis, the reclaim is based on the paid amount anyway).
In practice, unless her bills are huge, the amounts are probably immaterial, but she's still doing it wrong.
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Vince M Hudd - Soft Rock Software
(I only came here looking for fellow apiarists...)
