Hi
The retained earnings (RE) carried f/w from last year don't not match the RE brought f/w this year in the accounting software.
Some change has been obviously made on a previous period and I now cant figure out where exactly.
How do I fix this?
Replies (10)
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Reconcile all (that is all not some) balance sheet accounts ideally as at the year end. The answer will be there.
Not sure what software you're using but... you may wish to review the audit trail reports (or similar) for actual *entered* dates. Later (than expected) entry dates are usually key. Even better if you know the date the TB was run for the final accounts!!!
Some software (e.g. Sage 50) makes it easier by assigning a unique transaction number... a transaction number of (say) 60000 would stick out like a sore thumb if in-year transactions were all in the 40000s!
Of course, if you don't have access to the software, as D V Fields has said, you'll have to reconcile every balance in the b/f TB against the full closing TB from the annual accounts... just beware, thd nominals may differ, adjustments may have been made in the FS's and you'll probably find there to be less nominals in the accounts than in the software.
I am assuming you have access to your full working papers, and all of the information provided by the client last year? That'd certainly be handy!
Which begs the question...
"Which software are you using"?!
Someone on here may use it, and may be able to give a better answer, based on that relatively small (but VERY significant) piece of information.
Unless, of course, you are using software provided by MI6? In which case, you're probably right to keep that under wraps!
It is clear from your previous questions that you are refusing to hire an accountant, so why should we help you? Any competent accountant would be able to find and correct a difference such as this, so just get one.
To be fair to the OP (?!?), we don't know which miltitasking activity this relates to. Is it the FRV registered courier? The business with hundreds of digitial receipts? Or the client (or clients) taking excess salaries from their company (aka the side-hustle accountant).
One would hope (?!) it's not the latter selling such services to Jo(e) Public but, the addition of 'software' to the mix can lead to reasonably decent accountants forgetting simple accounting principals! The times we've all heard "The software did this", and the endless times we've responded along the lines "No! YOU did this, the software just did what YOU told it to do!"
Benefit of the doubt (and it's at a push), I hope John is a decent accountant with software issues, as opposed to a software accountant with expertise issues. If the latter, I do question whether there should be any 'clients' at all.
It'll be a mistake which you have made before closing down last year. Or maybe not closing down last year properly.
There's no other answer but for you to look harder or do what you should have done when you started the business and get yourself an accountant.
Do not worry
The accountant made corrections on last year's accounts
The accountant will fix it when he does this year's accounts
It was probably depreciation, corporation tax, accrual for his fee, writing off the 2 year old entry in the Sales or Purchase ledger, correcting an inappropriate dividend or correcting the director loan account. Not a full list but something to get the company accounts compliant.
If you ask he will provide the journal for you
It could of course be that you picked a date on a current year item that is incorrect. That happens a lot in January each year
How do I fix this?
1)make it up
2) look properly and find it
3) pay someone who knows what they are doing to fix it and other mistakes you have made