Incomplete accounts

Mark 99
Mark 99 Registered Posts: 14 New contributor ?
Does anyone have any advice on the following?

I have a client, for whom I have to start year end accounts. He uses Sage Instant Accounts, and has (nearly) always logged sales invoices issued and purchases made. However, he has not made any record of payments being made, either on the purchase ledger side or the sales ledger side: i.e. no cash book transactions.

It seems that we can do a P&L as sales and purchases have been recorded, but a balance sheet (and the reconciliation between the balance sheet and the P&L) are going to be very difficult. What do people suggest I do with regard to the bank records in Sage? I could post an adjusting entry, to bring the balance up to the correct amount on a certain date, and then carry on from there.

Any advice will be welcome.



  • mini_schnauzer
    mini_schnauzer Registered Posts: 347
    If you posted a balancing entry to correct the bank the debtors and creditors would be wrong.

    Wouldn't it be easier and more correct to post the bank entries from the bank statements?
  • Monsoon
    Monsoon FMAAT, AAT Licensed Accountant Posts: 4,071 ? ? ?
    If a Ltd Co, essential that it's done properly and bank reconciled. That's the long and the short of it.

    If a sole trader, no requirement for balance sheet.

    The correct thing to do would be for him to either go back and do it right, or pay you to do the missing work, and go from there.

    If he won't do those, make sure you put it in writing that you strongly advise he should, and then prepare a P&L for the tax return.

    However, if it's more than just simple income and expenditure eg VAT registered, assets, loans, etc then it needs doing properly and he will either have to do it, or pay for it.
  • coojee
    coojee Registered Posts: 794
    If you don't post the bank account you don't know if he's accounted for ALL of the sales and purchases. He could have only recorded the sales he wants the tax man to know about and he could have recorded purchases for things that don't exist.
  • cobbles
    cobbles Registered Posts: 30 Dedicated contributor ? ? ?
    I deal with incomplete records quite often normally new clients I would normally post the bank as I consider this to be some thing that is actual and can not be changed and once reconciled show a true picture of the companys income and expenditure, I normally reduce my hourly (bookkeeping)rate for this type of service and once the records have been brought up to date charge my normal hourly rate for any further bookkeeping work, generally most of the clients have been happy to for us to go ahead with this.
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