Bookkeeping skills

Gillian Registered Posts: 17 Dedicated contributor 🦉
Hi there

this is my first post so hopefully this is all in the right place.

I have recently qualified under AAT (old standards diploma pathway) but I have thought about a couple of things that I don't recall studying under the syllabus and wanted to ensure that I have the correct understanding so re look into it.

If this was covered somewhere and anyone can recall which module I would be really grateful. If not can anyone recommend where I might find these out.

1) Bookkeeping - setting up the COA for a Limited Company. Additional accounts which would need to be set up for a Limited Company over and above a Sole Trader or Partnership and those not required that are in Sole trader/Partnership. I can think of Share Capital and Directors Loan or Current but are there any others. And then we wouldnt need Drawings that would be in Sole Trader accounts.

2) This may be obvious and I am getting confused -Bookkeeping again - so the client has reached the end of the financial year and we have the TB from them, adjustments are made for prepayments accurals etc, so now we need to record these adjustments in the accounts once the final acconts are produced. Physically how is this done or does it depend on the package in use (ie some sort of year end) and what the accountant has provided.

3) Sole trader/partnership to Limited Company. So a sole trader or partnership business has decided to become a limited company. Obviously we would need to "close down the Sole trader" which would leave some closing balances like debtors and creditors which would presumably form opening balances for the limited company. Additionally any assets would need to be closed off in the sole trader accounts and opened in the Limited Company accounts. (I know there may be issues of ownership here). For assets would you take the NBV across or the tax written down value. And then there is goodwill. (this is only talked about from the point of view of adding it to partners accounts that I can find so not sure what factors to consider in determining its value) Is there anything else to consider. Is there a check list anywhere for this move. I am not attempting to do this. I just want to expand my learning so would welcome a pointer to where it is in the study or where else I could learn this.

many thanks and hope this is the right place to ask such things


  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
    1) Depends what bookkeeping package. Some will have a pre-set CoA depending on the entity. Essentially, you're right. A Ltd Co will need a directors loan account through which all transactions with the director/shareholder go, as well as share capital etc.

    2) Are you doing the books and the accounts? If you're doing both, then I'd be inclined to do the adjustments in the books, and then transfer a perfect TB into the final accounts production software. Or, you can transfer a TB, make adjustments externally, then post adjustments back into the books. If you're just doing the books, ask the accountant for the journals you need. If you're just doing the accounts, give journals back to the bookkeeper. It's a matter of preference and working practice and software in many respects.

    3) This is a big topic. Google it and read everything you can. Read up on Incorporation Relief in particular.

  • Gillian
    Gillian Registered Posts: 17 Dedicated contributor 🦉
    Hi Monsoon

    thanks for your replys very useful indeed.

    Not doing anything just yet just going over my knowledge really.

    1) I have done a lot of bookkeeping for Sole Trader and partnerships, but I have been asked to do some bookkeeping and accounts for some Limited Cos, hence question on Limited Co. Most software I have looked at does in fact have the templates in it just wanted to be sure I wasn't missing anything obvious.

    2)Good idea I will make the adjustments to the accounts where I am doing the bookkeeping, I will also do it for one person who will be using an online package. Ongoing will judge accordingly

    3)Will have a read thanks, this hasnt come up but was just thinking it might so was making notes of what I might need to ask. I can get help in this area anyway but I always like to look into these things a bit

    thanks for you help
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