Can you please advise how I account for invoices (sales and purchase) that were raised before my year end (30th June 2016) which are being paid in this financial year.
My accountant will import the opening balances, but when payment goes through, do I log these as “new transaction” and tag to “something not on this list” crediting or debiting the relevant creditor/debitor control account OR as “payment from a supplier/customer” to raise an invoice? Will raising an invoice for purchases and sales dated in the previous financial year when it was received or sent (which I will need for VAT purposes) create duplicate entries?
Thanks in advance,
Raising an invoice prior to the start of the financial year should be acceptable, and would be picked up on any relevant VAT returns. If you were to tag them straight to the nominal code via ‘Something else not on the list’, then the VAT wouldn’t be accounted for.
If you are on cash accounting for VAT, then obviously this will pick up on the payment made against them. However, if you are accrual accounting, then remember to set your VAT start date (this is in your VAT settings), otherwise the invoice could be counted twice (once by your original system, and then by QuickFile).
I hope that all makes sense. If not, please don’t hesitate to ask
Note: I’m not an accountant
Ok thanks, so raising invoices for the previous year won’t create problems with the trial balance that is imported?
It would affect it. So what you would need to do (or in this case, your accountant) is make adjustments on the balances of the general sales and debtor control accounts.
For example, if you have an invoice of £100, you would typically reduce general sales and debtor control accordingly in the opening balances (from the Trial Balance)
Ok great, so just to check I understand it right: from my side, I create and reconcile outstanding invoices from the previous year as normal and my accountant adjusts the trial balances accordingly?
That sounds right to me. May be worth just double checking with your accountant to make sure you’re both on the same page etc.
If you need further help, please let us know
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