Can anyone explain what the 9998 Suspense Account is on the P&L sheet. Where does this figure come from?
This might help:
Also if you search the forum for the words “suspense” you’ll find a lot of related discussion.
I have a rough idea now about what this is, however the suspense account figure adds to my profit figure, Is that right?
In order to get an accurate P&L and balance sheet the suspense account should be zero (or as close as possible). Any untagged bank entries will sit on suspense until they’re tagged. So tagging all your bank entries would be the best place to start, after that check for any opening balances and journal them accordingly.
If there was a button on the dashboard to go to the Suspense (Untagged transactions) account to check what is waiting to be tagged, this would be easier to keep an eye on and would also be easier to navigate.
I am sorry for asking but can you explain how I would journal the opening balances so they don’t affect my profit figure.
This is very much dependent on your previous accounting records. Normally you would take the trial balance from your previous accounting software and import this on the date you want to transition to QuickFile, this would then fully explain any bank opening balances.
How the journal would look depends entirely on how that opening balance was derived (e.g. preceding sales, expenditure etc). Unfortunately it’s not something we can advise upon but I would recommend having a chat with your accountant who should be able to assist.
This issue is that my old method of accounting did keep records of account balances and so on as I was not VAT registered and kept the accounting simple. I have added and entry under subject (Opening balance on an account affecting net or gross profit figure). Hopefully someone can help with the issue of how to stop the opening balance showing as profit, when it is not profit.
When you switch from a single entry accounting method (e.g. Excel) to double entry, there are usually some blanks that you need to fill in. Explaining opening balances is a part of this process and requires that any 9998 balance is fully journalled.
From what you have mentioned I think it would be well worth getting a bookkeeper to get eveything setup for you. We do have a few bookkeepers we work with, I’m happy to put you in touch if you like?
You can also try posting on one of the following forums that are frequented by accountants and bookkeepers:
http://www.ukbusinessforums.co.uk/forums/accounts-finance.55/1
http://www.accountingweb.co.uk/1
To journal the opening balance on an account would I just go to modify and edit the opening balance by changing the credit amount from (9998) Suspense Account to the relevant nominal code?
Yes that’s correct, you can edit the journal directly moving the balance to another code or splitting it across a number of codes.
Ok, well all I really want to do is move the opening balance of an account from the suspense account to another nominal code that will not affect my net profit figure. The opening balances on my accounts are just the amounts that were in the accounts on the date I started using QF and not relevant before this time as I was using a simple in/out accounting method as I was not VAT registered at that time.
P&L figures are reported from date x to date y, so why not move the opening balance to before date x and it won’t show on the P&L then?