Hello. I have recently started trialing the use of Quickfile, because my previous software did not support VAT digital payments.
To simplify the set up I have waited until my company year start of 01 Apr to start using Quickfile so accounts up to the last year will be completed using the previous software. But of course the business bank account already has a balance at 01Apr2019. Also I have submitted my VAT return for the last period but HMRC will not take payment for a few weeks so I need to show a VAT liability as of 01Apr2019.
After reviewing many discussions on opening balances I am still not clear how this is correctly set up. I understand the journal entries should be used but am still confused what the 2nd balancing entry should be made out to. So, for VAT I have created a credit to the VAT Liability (2202) but what should the balancing line be made out to ? Currently I have selected Manual Adjustment (2204).
For the business current account I have created a debit to Current Account (1200) and at the moment a 2nd entry to balance this to the Suspense Account (9998) but I know this is wrong.
I saw some suggestion that a full closing trial balance should be included but I don’t really understand why this is necessary if I will have fully made up accounts for the last period and therefore why we cannot have a simple starting adjustment for using this software. Could I potentially use Retained Profit (3101) or create a new account ‘Current Account_Opening Balance’ to make this adjustment ?
Thanks for any help.