All expenditure is initially shown in the P&L and if anything is to be capitalised it is treated as such at year-end. Not best practice, but there you go.
The 10 years write-down is the policy I am told.
Thank you for explaining the movements within the balance sheet and P&L.
Thanks Paul. Maybe I am looking at this entirely from the wrong angle.
Am I right in thinking that in the Yr 1 B/S, if I am reporting (say) a £3ok surplus balance of restricted income (which has already been paid during the financial year), it would make up £30k of the assets reported in the B/S?
With restricted funds being a little like a creditor until spent, shouldn't I be balancing off that year-end £30k figure against something else (in the B/S) which takes that into account?
My answers
Many thanks, I will ask our auditors. It is useful to have any advice from other experienced practitioners.
It is a leased property, with 73 years left on the lease.
All expenditure is initially shown in the P&L and if anything is to be capitalised it is treated as such at year-end. Not best practice, but there you go.
The 10 years write-down is the policy I am told.
Thank you for explaining the movements within the balance sheet and P&L.
Hi, it was for building works for a small extension. Sorry for not being clearer.
Many thanks for your advice. Just to clarify, in my example, I was thinking of restricted income showing a positive year-end balance of £30k.
So, in terms of the matching concept, we would have to live with a year-end B/S that is 'overstated' by £30k.
Thanks Paul. Maybe I am looking at this entirely from the wrong angle.
Am I right in thinking that in the Yr 1 B/S, if I am reporting (say) a £3ok surplus balance of restricted income (which has already been paid during the financial year), it would make up £30k of the assets reported in the B/S?
With restricted funds being a little like a creditor until spent, shouldn't I be balancing off that year-end £30k figure against something else (in the B/S) which takes that into account?