Bank figure on a balance sheet

clearaccounting100

My sister in law is a sole trader and has asked me to do her 2nd yr accounts. I have a copy of the accounts prepared by the account for the 1st years trading. The figure on the previous yrs balance sheet @ 31/03/08 is £950 under the current liabilities and therefore an overdraft. However, my problem is that i have the bank statments for the yr and the balance of the bank on the 31/03/08 is £15,000 in the black! i cannot work out how the previous accountant got this figure. The fig on the b/s bank should be the balance of the account as of that day shouldn't it!? i have looked at the previous bank statement page's and at no point does the bank balance equal the fig the accounts show on the b/s. Am i missing something? is there any situations where the b/s wouldn't reflect the cleared balance on the bank statement? The only way i can get my trial balance to balance is to debit the bank by about £16000 and credit sales by £16000! Any comments or help would be very much appreciated, i think i am missing somethig or being extremely dumb :crying: Many thanks

Jan

What was the reconciled bank balance at 31.03.08? That is the figure that should be on the balance sheet.

It would be very unusual not to have any cheques that hadn't yet been presented at the bank at year end. Most companies write their cheques out at or towards the end of the month, so at a guess your sister in law paid off her creditors just before 31.03.08.

Unless I am missing something?

Gem7321

You need to request a copy of the bank reconciliation from the previous accountant, or you can re-create it yourself if you have last years cheque books.

clearaccounting100

Hi Jan, thanks for your post, her reconciled bank balance was £1808 o/d so that's a lot nearer. Thanks v much for the advice. :thumbup:

clearaccounting100

Thank u both for your advice, it is v.much appreciated :001_smile:

AK002

Yup as said, it's the reconciled balance at the year end, not actual bank balance.

PGM

We had a strange experience at work, the then main accountant was working through bank reconciliations that I'd done, and looking at bank balances and trial balances, but couldn't work out why there was a 10k difference. Turns out it was a month end movement to the high interest account. It had gone from the current account but not yet hit the other account.

Bit sad that I thought that was an interesting story :001_unsure:

Jan

Bit sad that I thought that was an interesting story

Do you also feel like doing a high 5 when you've reconciled a difficult bank account?

lorraine

I do lol!

Toffeemadblue

I'm mostly in tears at that stage !

Jan

As the only one working in finance in my office, it's so good to know I'm not alone, although don't think I've ever been reduced to tears, Matt.

lorraine

I'm the only one in the Accounts Office at work and also I don't know anyone that works in finance, no-one knows what I'm talking about can be frustrating but at least I can go on this forum and type to finance minded people, life saver! don't know what I would do without it.

Jan

Definite life saver coming on here.

I work in the same office as one of the secretaries. There is a great nashing of teeth whenever she has to type into an excel program, especially when "it thinks for itself"

She tells me she doesn't know how I do my job , I don't know how she does hers, is usually my reply.

clearaccounting100

I' got it to balance, thanks v.much! I also like to hi 5, jump about or do a huge whoopie and a little dance when i get something difficult to balance! it's a good job i work in my own home!:001_rolleyes: