HOME / COMMUNITY Switch to knowledge base

Closing off rounding errors on year end accounts

Hi, this year I used the QuickFile year end service for Limited Companies (which has been brilliant) rather than my previous offline accountant. That raised a few issues with discrepancies between my previous accounts and what QuickFile was showing.

One anomaly that remains is when I run the Historical Debtor/Creditor report there are a couple of invoices showing as part-paid that have actually been paid. The reason is that they were invoiced once and then paid down by monthly direct debit, so one year there is 3p outstanding and the following year 4p. Its just a rounding error because the merchant didn’t collect the money, but I’m not sure how I can reconcile as fully paid?

I guess you can either credit note the residual balance, or just mark it as paid into something like the director’s loan account and then balance that with a manual “money out” tagged to something like “miscellaneous expenses” - I’m not an accountant to be able to advise which is more correct from an accounting point of view.

1 Like

Thanks Ian. That was what I was wondering about doing.

I have to apportion several regular expenses with a personal use adjustment (as instructed by HMRC at a VAT inspection) which I do via a ‘negative’ purchase invoice. However because of the way QF treats credit notes in the purchase ledger, in that they have to be allocated when created, so I have an account ‘Suspense account (for credits)’ which is then cleared by a balancing entry to the bank account as I settle it from my personal account. (You’re probably wondering what this has to do with the question.)

This has proven useful as a holding place for other tasks such as writing off those rounding errors so you’d mark them paid as Ian suggests and then balance to an expense called ‘Rounding errors written off’ or maybe ‘Discounts’ as that’s effectively what it is if you’re not chasing them for it.

1 Like