Sage

MVT

Hello everyone,

I have received an enquiry from a Limited Company who use Sage accounts, they would like me to do their VAT returns and book keeping.

They have informed me that although the VAT returns are done through sage the quarters are never reconciled and so when the VAT returns are done they have a message to say something like '1000 entries found for this return, 800 are unreconciled and found outside this date range' do you want to include them? Obviously the answer is no but is there a way of putting a line under this and reconciling all entries so that the next quarter there will be no unreconciled items?

The same applies to their bank reconciliations on sage (it has never been done)!!

Thanks,

Yestin

When doing the VAT return on sage there is a button that says Reconcile! You need to click this button after running all the reports you need.

You still might get a message box asking if you want to include passed transactions but I find that these are transactions posted back in that period after the VAT return for the quarter has been done and dusted.

Hope this helps.

Monsoon

Hi

What that means is that, yes, VAT returns have been run but those transactions have not been flagged for VAT, so Sage wants to pick them up on the next return.

What you need to do is this:

Run the first VAT quarter from the last reconciled one (possibly the first one ever)
Make a note of the VAT payable on a spreadsheet
In the next column, note the VAT payable according to the VAT returns actually filed
In the next column, note any difference
Click reconcile on the VAT return in Sage.
Run the VAT transfer wizard to move the VAT sales and purchases from 2200 and 2201 to the Liability account 2202.

Then reconcile that quarter in Sage and run the next VAT return, rinse and repeat.

You will end up with the VAT transactions reconciled in Sage, and probably some (hopefully small) discrepancies between returns filed and transactions in Sage. This balance on the spreadsheet should match the balance in 2202.

Adjust for this difference on the next VAT return you run, and if it's under £10,000 VAT you don't need to make a disclousure.

Hope that helps!

Re Sage bank rec, just reconcile it from the beginning - probably want to do this before reconciling the VAT as you may encounter transactions that need adding in or deleting. Watch out for what financial year Sage is in too.

sdv

MVT wrote: »

Hello everyone,

I have received an enquiry from a Limited Company who use Sage accounts, they would like me to do their VAT returns and book keeping.

They have informed me that although the VAT returns are done through sage the quarters are never reconciled and so when the VAT returns are done they have a message to say something like '1000 entries found for this return, 800 are unreconciled and found outside this date range' do you want to include them? Obviously the answer is no but is there a way of putting a line under this and reconciling all entries so that the next quarter there will be no unreconciled items?

The same applies to their bank reconciliations on sage (it has never been done)!!

Thanks,

This sounds very serious

Normally you would post all the entries in sage and after you have printed the vat return you need to reconcile the entries that has been accounted on this vat return.

The reason for doing this is that sage is a very date sensitive database. So if you have completed say vat for q/e march 2010 and then in May you receive an invoice dated say 28th march, an accounts assistance is likely to have posted that invoice on sage using 28th March date.

So when you come to do the next vat return for q/e June 2010, and if you have correctly reconciled the previous vat transactions, then Sage will tell you that you have 1 un-reconciled transaction that is outside the current vat return period of 1/4 to 30/6.

This should prompt you to investigate these transactions and claim the vat in this return if not claimed in the correct period.

However, if you ignore this message, then it is more likely that you will have under claimed vat input or under declared vat output on the sales invoices.

the solutions to this would be to investigate all the 800 entries that are outside the vat period and check them against the past vat return to see if they have been claimed correctly.

There is a short cut way to check this as well - concentrate on the audit trail number and just check up to what audit number is included in any particular vat return and then quickly gaze the date on the following transactions to see if any of them belong to the previous vat return period, as it is unlikely to have been declared if the sage warning message has been avoided.

Good luck with the reconciliation task

MVT

Thank you Monsoon and SDV,

It looks like I'm going to be very busy reconciling then.

With regards to the bank statements they haven't been reconciled on sage since day 1 and so there are transactions going back 8-9 years.

Michelle

Monsoon

MVT wrote: »

Thank you Monsoon and SDV,

It looks like I'm going to be very busy reconciling then.

With regards to the bank statements they haven't been reconciled on sage since day 1 and so there are transactions going back 8-9 years.

Michelle

It might be worth putting in the current bank balance and hitting 'all' on the bank rec and seeing how far out it is.... Theres a tiny chance it might work!

It's a tricky one, because the prior years will have been done and the accountant wont want to reopen them. And indeed should have done his own bank rec, just might not have updated Sage. So might be bst to just make sure this years bank reconciles perfectly and just put an adjustment into last year to bring the opening balance up to date. I would discuss it with the client and their accountant before reconciling anything more thatn the current years bank.

Good luck- big job!

Gem7321

Monsoon wrote: »

because the prior years will have been done and the accountant wont want to reopen them. And indeed should have done his own bank rec, just might not have updated Sage. So might be bst to just make sure this years bank reconciles perfectly and just put an adjustment into last year to bring the opening balance up to date. I would discuss it with the client and their accountant before reconciling anything more thatn the current years bank.

Agreed!