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Ends of year - Directors advances to the company

How does the directors loan account (in credit) get reported correctly in micro accounts

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I am reviewing last year's accounts produced for my small ltd company (second year trading). They are straight forward other than one thing - how directors loans are accounted for. (example with simple numbers):

DL ac credit end of yr 1: 1500
DL ac credit end of yr 2: 2500
i.e. on balance I loaned the company an additional £1000 in yr 2.

But in the micro entity balance sheet there is
Creditors: amounts falling due within one year (yr1): ( 1200 )
Creditors: amounts falling due within one year (yr2): ( 700) 
these are the losses for those years

And then in the notes to the balance sheet in year 2 there is:
Balance outstanding at start of year: (1500)
Amounts advanced:(0)
Amounts repaid:(1000)
Balance outstanding at end of year: (2500)

I am not sure why the Creditors falling due within one year does not have these figures in them?

 

 

Replies (13)

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By johngroganjga
01st May 2019 07:53

To state the obvious, these are questions for the person who prepared the accounts you are reviewing.

Thanks (1)
RLI
By lionofludesch
01st May 2019 10:32

Maybe you should pop in and correct him if the terms of the loan are that it's repayable within less than one year.

While you're there, ask him why there's any sort of note about a loan you're making to the company.

It's not required at all.

Thanks (0)
RLI
By lionofludesch
01st May 2019 10:34

"But in the micro entity balance sheet there is
Creditors: amounts falling due within one year (yr1): ( 1200 )
Creditors: amounts falling due within one year (yr2): ( 700)
these are the losses for those years."

Losses and creditors are not the same thing at all. Have you got hold of the wrong end of the stick here ?

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By SXGuy
01st May 2019 11:06

I think your question shows that you are not capable of preparing your own company accounts, otherwise you would have a good understanding of balance sheet entries.

Id say get an accountant, but I can already hear the phrase "the company doesn't earn enough to pay for one" in which case, I have no answer for you.

Thanks (1)
Replying to SXGuy:
RLI
By lionofludesch
01st May 2019 15:31

SXGuy wrote:

Id say get an accountant, but I can already hear the phrase "the company doesn't earn enough to pay for one" in which case, I have no answer for you.

I inferred he already had one.

But you could be correct.

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By Mike Bath
01st May 2019 12:12

Loans made to the company are reported under Debtors not Creditors. Is there a heading such as 'Other debtors' where the amounts are included (perhaps as part of a larger total)?

If you are reporting under the Micro entity rules then there is no need to include a note about money loaned to the company by a director.

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Replying to Mike Bath:
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By atleastisoundknowledgable...
01st May 2019 12:22

Mike Bath wrote:

Loans made to the company are reported under Debtors not Creditors.

Are you sure about that?

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Replying to Mike Bath:
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By andy.partridge
01st May 2019 12:34

Now you tell me. I've been doing it wrong all these years.

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Replying to Mike Bath:
Hallerud at Easter
By DJKL
01st May 2019 12:34

Mike Bath wrote:

Loans made to the company are reported under Debtors not Creditors. .

Which side is the window??????????????????

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Replying to DJKL:
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By Mike Bath
01st May 2019 14:39

That'll teach me to read what I've actually typed! It's been a long week, and it's only Wednesday.

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By andy.partridge
01st May 2019 11:20

Let us know the name of your accountant and one of us can have a word with them. Get it sorted for you double-quick.

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By ireallyshouldknowthisbut
01st May 2019 15:37

1. Pick up phone
2. Dial accountant's number
3. understand accounts

or 3b, fire accountant, hire someone competent who can explain what they have done and why.

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Replying to ireallyshouldknowthisbut:
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By andy.partridge
01st May 2019 15:57

Phone themselves, fire themselves? What is this nonsense of which you speak?

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