Prior Year Adjustments in Sage

As far as I have ever found you can't change a Prior Year in Sage. You can only post correcting journals on the first day of the current financial year to the Balance Sheet P & L account.

The wages journals should always be:

7001 Directors GROSS wages

7006 Employers NI

2210 Total due to HMRC for PAYE and total NI

2220 Net wages liability

You then make the bank payment to 2220

If last years accounts have only been closed in Sage, but the Accountant has not yet finalised the year accounts, then inform the Accountant about the change in the figures then post the journal to correct everything and date it 31/12/11.

Then print a Bought Forward TB and do a journal to transfer any figures in nominals 4000 to 9999 into the Profit and Loss nominal, again dating the journal 31/12/12

If there are any figures in nominals other than 7001 and 7006 you will need to investigate these and inform the Accountant, as these will be prior year items entered AFTER the year end was run.

You can then print a Brought Forward Balance Sheet and, if Instant has it, there is a Prior Year print in financials which will give you the P&L

Any problems or you would like to discuss further, email me at witch@witch-queen.com and I will reply with my phone number

Witch-Queen

Sorry scalloway, that is wrong. Prior Year is easy to change in Sage.

See my answer to this question.

You would ONLY make the adjustments on the 1st of the new year, if the Final accounts has already been filed

Not sure about Instant but in Line 50 you can go into Record and edit previous year figures.

@ Witch-queen

If I understand you correctly you are doing two Journal Entries at 31/12/11, one to correct the OP's problem, the other to correct Sage as it will not automatically update any P & L balances.

@scalloway

Posting any prior year items into any of the Profit and Loss nominals, after the Year End has been run in Sage, will result in a line on the current year Balance Sheet 'Prior Year adjustments' in the Capital Account. The value of these items will also be included in the current years P&L

But by reversing these postings into the P & L nominal using the year end date, you will get rid of that line on the BS, and your P&L and BS will be correct, exactly as if the items had been entered before the year end had been run in Sage. 

That is exactly what Sage does when you run year end, it zeros each P&L nominal, and posts the resulting figure into the P&L nominal on the BS by journal. You are therefore just doing the same but by manual journal

Witch-Queen

Doing what Which queen says won't give you what you want.  Work out what the correct balances should be on a spreadsheet go into Nominal Ledger/Record enter the figures as they should be and press save and you will have your comparatives right.  You can't print out a P&L or balance sheet or P&L for a previous year in Sage unless you go into archives and you can't change them.  (Sage is unique in software packages in not being able to do get previous year accounts out - something to do with the anti-deluvian database Sage is built on)  But doing as I say and printing out a prior year report for the current year end will give a correct P&L for the previous year in the comparative column.  You will need to do a previous year balance sheet and trial balance on a spreadsheet.  Marvellous how Sage got to be the country's top selling accounting software.

@myshkin you say

'go into Nominal Ledger/Record enter the figures as they should be and press save and you will have your comparatives right'

Wonderful in theory, BUT have you actually tried to do this before advising the poster?

You may have missed it in the post but Year end has already been run in Sage

You can only change figures using your method in the CURRENT year. You cannot change the B/fwd that way

Also you CAN run prior year P & L and BS, see my post above

Yep do it all the time.  It is the only way you can amend previous year figures that would otherwise be wrong because of auditors post closing adjustments etc.  Thought you knew everything about Sage?  And no you can't run previous years monthly accounts doing it your way.

After doing the entries in the restored data, the journal in the current year should be dated 31/12/11 to give the correct brought forward trial balance.
Any P&L items should be posted to Retained Earnings so no entry appears in the B/S as prior year.

Hi there

My understanding is that for the balance sheet you can post a journal dated in the prior year and it will adjust the brought forward balance. The P and L side of it should be posted to retained earnings.

It is no longer possible to adjust the prior year figures (this function disappeared a couple of years ago).

To produce revised P and L and balance sheet for last year, save your current data, open your final year end backup and post the necessary journals. Re-save! Also a good idea to do another year end and create a new archive.

Then you just live with a P and L prior year  discrepancy for a year.

I had to do this myself this year end! In the middle of the year end audit. Grrr to not being given accurate Trustees' minutes, and grrr to the director who said "I thought the figures looked wrong" but didn't say anything to me!

Hope that helps.

Guys,

I am well aware that a director of a small company in the UK can take out cash from his/her limited company (so long as it is not more than what they put into the company in the first place).

By way of illustration, Jack is a director of a small company (company ticks all the boxes for categorization as a small company).  Over the last two years he has put in 30,000 GBP into the company via day-to-day expenses and various deposits (individual transactions range from about 20 GBP to 1,000 GBP).

He has now taken out 15,000 GBP as payment or rather repayment of part of these monies expended by himself.

QUESTION:

Will he have to declare this in the "Employment" supplement of his Self Assessment Return and is this payment subject to taxation?

but I'll answer anyway.

Any withdrawal of money that you have lent the company has no tax consequences so ignore it for personal Tax Return purposes.

(I assume you meant to start a new thread)

Scalloway,

Appreciate your response and yes I meant to start a new thread, but got things mixed up due to the fact that I am new to this.  Please accept my sincere apologies.

Many thanks.

Ade

" who said "I thought the figures looked wrong" but didn't say anything to me!" 

What you say won't give accurate figures in the current year because the comparatives will be all wrong so the Director will be on at you again (and rightly).  To keep him happy buy  a software package other than Sage - they all do prior year postings correctly.