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Invoice dating

Incorrect date issue

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Received an invoice from a supplier this week, dated mid July. My employer has already run July and Aug reports. Instead of making the correct journal entries, I am told to simply enter a date this month, regardless of the invoice date, so as it can be added to this mo ths report. May seem like a novice question, but is this OK?

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By paul.benny
25th Sep 2021 11:58

Yes

Prior months should be closed and no new entries made. If the invoice was received today, post it today.

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Replying to paul.benny:
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By Lillibet1st
25th Sep 2021 13:37

paul.benny wrote:

Yes

Prior months should be closed and no new entries made. If the invoice was received today, post it today.

Though they only sent the invoice through this week, it is dated back to July

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By zebaa
25th Sep 2021 11:59

How material is the invoice ?

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Replying to zebaa:
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By Lillibet1st
25th Sep 2021 13:38

zebaa wrote:

How material is the invoice ?


€1000
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Replying to Lillibet1st:
Stepurhan
By stepurhan
25th Sep 2021 18:56

Not how much is it, how material is it?

For a business with £15k turnover, a £1k invoice is probably material. For a business with £1milllion turnover, £1k is inconsequential.

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By Hugo Fair
25th Sep 2021 13:32

Does the invoice include a VAT component? And are you accounting for VAT on a cash basis?

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Replying to Hugo Fair:
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By Lillibet1st
25th Sep 2021 13:38

Hugo Fair wrote:

Does the invoice include a VAT component? And are you accounting for VAT on a cash basis?

Yes it does and yes we do

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Replying to Lillibet1st:
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By Hugo Fair
25th Sep 2021 13:42

So no obvious problem then in entering it now (unless your accounting year end falls in-between the retrospective invoice date and today).

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By tom123
25th Sep 2021 14:00

What type of finance software do you have?

Medium sized systems tend to only allow postings into open 'periods', rather than slotting stuff back into the past according to date.

If you do have a purely date based system (like Sage 50) then you will need to enter as today's date to avoid changing past reports.

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Replying to tom123:
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By Paul Crowley
25th Sep 2021 14:27

Exactly the issue
Software is date sensitive
Result of back dating could end up with VAT errors amongst other issues.
deal with this months new entries with this months date

Other issues
A year ago now we had a client that cried blue murder about the accounts being wrong
Yes you guessed it, he backdated transactions after giving us the reports.

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RLI
By lionofludesch
25th Sep 2021 14:11

If neither your VAT quarter nor your accounting year is 31st July, you can make your own rules up. It's a purely internal matter.

If it's your VAT quarter end, it'll be grand from HMRC's point of view sticking it in August as a correction. Again, internally, up to your own company policy.

If it's your year end, it can be entered in August and adjusted for as an accrual/creditor in the accounts.

None of these are a problem. I would strongly recommend that you stick to whatever the policy has been in the past, if only for the sake of consistency.

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By Bilal trainee accountant
25th Sep 2021 19:59

Why are you making journal entries for an invoice? I dont understand sorry. Surely you should just record it in the purchases ledger for that supplier for the date that it was invoiced.

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Replying to Bilal trainee accountant:
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By Lillibet1st
25th Sep 2021 20:07

Bilal trainee accountant wrote:

Why are you making journal entries for an invoice? I dont understand sorry. Surely you should just record it in the purchases ledger for that supplier for the date that it was invoiced.

Sage recommend making journal entries dated the transaction month, for a record

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Replying to Bilal trainee accountant:
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By Paul Crowley
26th Sep 2021 15:16

Reason
The backdating issue

I would post from bank directly to VAT and the expense if this invoice was bring paid all on its own

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