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Bank Opening Balances

  • 7 posts
  • # 76561

Hi,  I have just taken over the book keeping for a client where spreadsheets had been previously used for the year's figures. 

I am entering all new financial year transactions onto Sage, however, the bank balance as per the balance sheet last financial year is the actual bank statement balance at year end, but there are 3 supplier cheque payments dated last day of the financial year that were not cleared in the bank until the new financial year and correctly these suppliers were not included in the creditors figures as they had paid before the year end.  I have entered the bank o/b as the bank statement balance at year end minus the uncleared supplier cheque payments.

To balance the opening T/B am I correct in thinking that now the capital figure from the balance sheet will have to be adjusted with the same amount?

Hope somebody can help me out there.

  • Fellow
  • Practice Licence
  • 27 posts
  • # 76590

Hi

Do you have access to the spreadsheets?  If the amount is not outstanding per the creditors balance then does that also mean that the expense was not included in the P&L?  If this is the case then it would be correct to enter the invoices in this financial year and post the cheques in this year too.  If the expense was omitted from the accounts, it is ok to include them in the current year.

Usually when speadsheets are used it is generally just an analysed cashbook constructed from the bank statements, hence the reason why the unpresented cheques were not included.  If this is the case then the expense would not have been included. 

I hope this makes sense as I have made a few assumptions.

regards

Lynne

  • 698 posts
  • # 76604

>
> Hi PP

No you do adjust the capital account he bfwd TB is set in stone (post balance sheet events excepted)

When posting the opening balance journal I code debtors creditors and bank to 9999 on the opening journal.

I then post all the opening ledgers coding them to 9999

So in this case I would have posted the TB Bank figure to 9999

Then posted a bank receipt dated as per the date of he closing bank statement (if he bank was overdrawn post a bank payment) again code to 9999

The post the outstanding cheques individually as bank pavements using their original dates and cheques nos to 9999

9999 should be zero and the bank balance will be correct agreeing to the tb with reconciling items shown.

Kind regards
Stuart


>
>

  • 7 posts
  • # 76609

Lynnesaid:

“Hi

Do you have access to the spreadsheets?  If the amount is not outstanding per the creditors balance then does that also mean that the expense was not included in the P&L?  If this is the case then it would be correct to enter the invoices in this financial year and post the cheques in this year too.  If the expense was omitted from the accounts, it is ok to include them in the current year.

Usually when speadsheets are used it is generally just an analysed cashbook constructed from the bank statements, hence the reason why the unpresented cheques were not included.  If this is the case then the expense would not have been included. 

I hope this makes sense as I have made a few assumptions.

regards

Lynne”


Hi Lynne

Sorry I was not very clear - this is all new to me.

I have checked the spreadsheets and the unpresented cheques in question were included invoices dated 12 Mar, 28 Feb (year end 31 Mar) etc appearing in both the bank column and the cost of sales and the other expense in the mobile column. I have also checked the total of the columns against the profit & loss for last financial year.

So I don't know what to do with these supplier payments paid after the year end as they had already been included in last year's accounts.

Best Regards
PP

  • 7 posts
  • # 76610

Stuart Wildmansaid:

“>
> Hi PP

No you do adjust the capital account he bfwd TB is set in stone (post balance sheet events excepted)

When posting the opening balance journal I code debtors creditors and bank to 9999 on the opening journal.

I then post all the opening ledgers coding them to 9999

So in this case I would have posted the TB Bank figure to 9999

Then posted a bank receipt dated as per the date of he closing bank statement (if he bank was overdrawn post a bank payment) again code to 9999

The post the outstanding cheques individually as bank pavements using their original dates and cheques nos to 9999

9999 should be zero and the bank balance will be correct agreeing to the tb with reconciling items shown.

Kind regards
Stuart

Hi Stuart

Thanks for replying.  I was not provided with a TB for the opening balances hence my hesitation with the bank opening balance.  These cheques had been dealt with in last year's accounts on the spreadsheet, both in the cash columns and the analysis columns (cost of sales & mobile)

I have already entered up the bank o/b without the outstanding cheque payments and have reconciled.

So sorry to be clear do I now have to enter another bank o/b to 9999 to deal with the cheque payments left out and then enter them to 9999?

Thanks for your patience - this is one I can't get my head around.

Best Regards
PP


>
>”



  • 698 posts
  • # 76851

Hi PP

Taking the closing balance per the year end bank statement was this as per the spreadsheet balance.

Kind regards
Stuart

  • 7 posts
  • # 76868

Stuart Wildmansaid:

“Hi PP

Taking the closing balance per the year end bank statement was this as per the spreadsheet balance.

Kind regards
Stuart”


Hi Stuart

Thanks for getting back to me.  Yes, the bank statement balance was used as the final bank balance in the reconciliation spreadsheet for the accounts, and from this in the Balance Sheet provided.

Many thanks
PP

  • 269 posts
  • # 76870

PPsaid:

“Hi,  I have just taken over the book keeping for a client where spreadsheets had been previously used for the year's figures.  .”



Hi PP,

I only skimmed over the replies, so I may have missed something, but is this a client, as stated, or are you an employee of theirs?

The only reason I ask is I can't see that you have a Practice Licence.

Perhaps it was just the wording, as I see the post is in the 'members in employment' section Wink

Kindest regards

Kerry

Edited at 23 Nov 2011 10:22 AM GMT

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