I am new to Quick File and am trying first with my small property company. I need to record transactions where payments for the property were made from my solicitors client account. Here is the background:
company (A), the one i signed up for QF, purchased a commercial property.
payments for deposit were made by my other company (B) direct to solicitors account. It was treated as a loan from company B to company A, paid direct into solicitors account acting for company A.
How do i record it correctly in Quick File? I can set up a new account, i.e. Solicitors Account, but i can’t record the payment of the invoice from the vendor, from Solictors Account. How do i do that?
I am migrating from Solar Accounts, and it was pretty straightforward there. Quick File looks more sophisticated than Solar, so it should be possible to record such transactions correclty?
It seems to me you don’t really need to represent the solicitor’s account at all - you’d just need to create an extra “loan” bank account in company A’s QuickFile, create a purchase record representing the deposit and mark it as paid from the loan account. This puts the deposit expense in company A’s P&L and shows the loan liability as an overdrawn bank account (and repayments to company B would be shown as transfers to that same account, until it reaches zero).
On the company B side you’d similarly create a loan account and tag the payment out of the company B current account as a transfer to the loan account, which then shows the loan as an asset. Repayments from company A are transfers out of the loan account until it reaches zero when the loan is paid off.
Ok, so i would create extra ‘loan’ bank account and call it ‘Solicitors Account’?
Any funds i send to solicitor will show there, and i will be able to make payments from this loan account to vendor and lender fees for example?
Also, I need to account for:
loan from my other company
mortgage
I tried to set up a mortgage with starting balance under LOAN ACCOUNTS, but it is showing in green and as an asset on balance sheet. This cannot be right?
I gather loan from my other company will need to be set up in the same manner as mortgage, but again, it must not show in green as a positive balance.
It sounds like there’s two separate things going on here - you want to represent a lump sum of money you send to your solicitor which they then use for several different purchases on your behalf from different suppliers, and you want to record the fact that you’ve received a loan (in this case from “company B”) and a mortgage. Both of these would be represented by extra bank accounts in QuickFile.
For the solicitor’s account I’d create it as a “merchant account”, then when you pay money to the solicitor you could tag it as a transfer from your current account to the solicitor account, and when that money is spent on your behalf you can create the purchases in the normal way and mark them as paid from there.
For the loans, create a loan account for each one but don’t set an opening balance. When you receive the loan amount that is then represented as a transfer out of the loan account (leaving it overdrawn to the value of the loan) and into whichever account received the funds (which could be your current account or it could be the “solicitor account” we created above if company B paid the funds direct to the solicitor).
Repayments of a loan are simply bank transfers into the relevant loan account, and interest you are charged could be represented as money out from the loan account tagged to a suitable expense nominal code.
(As always, double check anything you’re not sure of with your accountant - I’m not one, I’m just a satisfied user of QuickFile)
Yes. You don’t need an opening balance on any of them as the first thing you’re going to do is transfer money out of the loan accounts and into the solicitor account.
All an opening balance does is create a journal that puts the other side of the opening balance in the suspense account, you’d still have to then move it from there to where it really came from/went to.