I would be grateful for guidance on the below. I have read up on this but would appreciate some practical guidance from the AW members.
We took over a new client, say ABC Ltd and are preparing the accounts for y/e 30/9/17. During the year a loan repayment of £6K was made. However we discovered that the original incoming loan, received in the y/e 30/9/13 was totally omitted from the accounts. So there is no Creditor in Sage against which the Debit can be posted. This was because the loan was paid directly by the loan provider to a third party supplier of ABC Ltd for some sort of subscription. The previous accountants did not pick this up.
We are using FRS105 to prepare the 30/9/17 accounts. We use VT Final Accounts. Turnover is £97K, PBT is £26K.
We now need to bring in the Loan of £6K into the BS. What is the best way to deal with this? This would be a Prior Period adjustment as it is material, but I cannot see an option in VT, using the FRS105 template.
Also how do we deal with this in the Tax Return? Clearly the 2013 profits were overstated by £6K. Do we just the reduce the current year profit of £26K in the computation? But then the relief would be partially at 19%, whereas the tax would have been paid at 20% in 2013?
Thanks for the help