I realise this has been discussed before but id like to run the scenario past my learned friends on here.
just done some accounts for a small limited company; dividends taken were approx £40k
retained profits before divis were only £13k; meaning a deficit of £27k
There is a £43k direcotrs loan to draw on but the fact is the dividends were voted and paid each month and were transferred to the directors personal account (narrative on stmt says divi).
Furthermore a few weeks ago we scheduled the dividends for borrowing purposes.
Part of the deficit is a large deferred tax provision as a van was bought and 100% AIA claimed.
I think the accounts should remain as they are with the actual dividends paid being left as dividends.
A mate of mine that works at a different practice is saying net the deficit off the directors loan.
What does anyone else think!!??
All input greatly appreciated