Not quite a brown paper bag job...

Aaron C Rescue

I have just started a temp assignment in s small company as a 'ledger entry' clerk entering the bank records onto Sage in preparation for the accountant to do the final accounts.

Can't help but notice that there are an awful lot of payments by DD, and bank card payments, but very few invoices.... is it this usual for small businesses to have such an appalling paper trail? How do you get around the lack of invoice backup, when some of the companies have gone bust and are no longer operating? Shall I simply continue to replicate the money trail (which is what I have been employed to do) and leave it for the Accountant to decide what to do?

Monsoon

Aaron C Rescue wrote: »

is it this usual for small businesses to have such an appalling paper trail?

Yes.

How do you get around the lack of invoice backup, when some of the companies have gone bust and are no longer operating? Shall I simply continue to replicate the money trail (which is what I have been employed to do) and leave it for the Accountant to decide what to do?

If it's obvious that it is a certain type of expense, then I would record it.
Under the new penalty regime I would be cautious of claiming back the VAT without a VAT receipt though.

If it's not obvious what it is, then you can dump it in an account called Expense Querise and leave it for the accountant to deal with. We love it when bookkeepers do that (but to be fair, it is one of the luxuries afforded a bookkeeper so if you need to use it, then do!)

If it's in Sage then make sure you are clear in Details that there is no paperwork to back it up, so the accountant can see when they read through the nominal ledger.

Aaron C Rescue

This is a family business and more recent Bank statements are showing that additional fixed amounts (between £25-£126.50) are paid weekly into some employees/family accounts and entitled 'expenses'. These payments are in addition to the weekly salary run. The people being paid do not leave the office, do not work from home, and do not provide a paper trail showing the backup for these expenses claim. How would you advise me to show these in Sage. Shall I highlight it to Accountant by opening up a new dedicated nominal?

Psyche

I would definitely highlight that these are likely benefits in kind that should go onto their P11Ds, if nothing else.

Monsoon

Psyche wrote: »

I would definitely highlight that these are likely benefits in kind that should go onto their P11Ds, if nothing else.

Absolutely. Round sum expenses payments are usually taxable. They need to talk to their accountant ASAP as this might not be tax efficient at all. It might be they think they are doing something clever, but might in fact be shooting themselves in the foot...!