How To Prepare A Financial Report

Transcription

1 A Step by Step Approach to Preparing Financial Reports and Processing Journal Entries [manual and using MYOB Accounting Plus v18] Copyright Notice: Copyright 2008 Marian Brown. All rights reserved. No part of this material may be reproduced or copied in any form or by any means (graphic, electronic or mechanical, including photocopying or by information retrieval systems) without permission in writing from Marian Brown. Written by: Marian Brown Dip T [Commerce], MICB Cert IV Workplace Training and Assessment, Cert IV in Financial Services [Bookkeeping] MYOB Certified Consultant for 13 years MYOB Accredited Author, MYOB Publisher, MYOB Accredited Trainer MBS Training Services Pty Ltd sales@mbsts.com.au Publishers: Software Publications Pty Ltd [ABN ] Head Office Sydney Unit 10, 171 Gibbes Street Chatswood NSW 2067 Phone: Web address: ISBN Printed September 2008 This book is dedicated to my Year 10 commercial teacher, Delmai Winnett who taught me my bookkeeping basics and encouraged me to further my accounting studies. Copyright Marian Brown 2008 A STEP BY STEP APPROACH TO PREPARING FINANCIAL REPORTS [manual and MYOB] Table of Contents

2 Copyright/Trademark Information: MYOB, MYOB AccountEdge, MYOB Accounting, MYOB Accounting Plus, MYOB BusinessBasics, MYOB FirstEdge, MYOB M-Powered, MYOB M-Powered Services, MYOB M- Powered Bank Statements, MYOB M-Powered Invoices, MYOB M-Powered MoneyController, MYOB M-Powered Payments, MYOB ODBC Direct, MYOB PowerPay, MYOB Premier and MYOB Premier Enterprise are registered trademarks or trademarks of MYOB Technology Pty Ltd and their use is prohibited without prior consent. Ceedata, Solution 6 MAS and Xlon are registered trademarks or trademarks of Solution 6 Holdings Limited, a member of the MYOB group. Bpay is a registered trademark of Bpay Pty Ltd, ABN MasterCard is a registered trademark of MasterCard International Inc. Microsoft, Access, Excel, Internet Explorer, Office, Outlook, Smart Tags, Windows and Word are registered trademarks or trademarks of Microsoft Corporation in the United States or other countries. VISA is a registered trademark of Visa International Service Association. Other products mentioned may be service marks, trademarks or registered trademarks of their respective owners. Screen captures from MYOB Accounting Plus v18 reproduced with permission. Limitations of Liability: This material is designed to provide basic information on how to use MYOB Accounting/Accounting Plus v18. Because business circumstances can vary greatly, the material is not designed to provide specific GST or business advice for particular circumstances. Also, because aspects of the GST are complex and detailed, the material is not designed to comprehensively cover all aspects of the GST. Further, the laws implementing GST and rulings and decisions under those laws may change. Before you rely on this material for any important matter for your business, you should make your own enquiries about whether the material is relevant and still current, and whether it deals accurately and completely with that particular matter; and as appropriate, seek your own professional advice relevant to that particular matter. This information is for the general information of MYOB clients and is not to be taken as a substitute for specific advice. Consequently Marian Brown will accept no responsibility to any person who acts on information herein without consultation with Marian Brown. The information in this book is relevant to MYOB Accounting Plus v18. Earlier or later versions of MYOB software could change the instructions in this workbook. Table of Contents A STEP BY STEP APPROACH TO PREPARING FINANCIAL REPORTS [manual and MYOB] Copyright Marian Brown 2008

3 Unit 8: Handling Bad Debts and Balance Day Adjustments in the next accounting period In this Unit you will learn how to: Handle Bad Debts in the 2010 financial year Handle Balance Day Adjustments in 2010 financial year This unit covers the following performance criteria in BSBADM408A: 2.2 Expense and revenue accounts are adjusted for prepayments and accruals in accordance with organisational policy and procedures and accounting requirements. 2.3 Bad and doubtful debts are recorded in accordance with organisation policy and procedures and accounting requirements. Copyright Marian Brown 2008 A STEP BY STEP APPROACH TO PREPARING FINANCIAL REPORTS [manual and MYOB] 2010 Entries Unit 8 117

4 Notes on July 2009 procedures [Balance Day Adjustments] On June 30 you entered balance day adjustments to account for prepaid and accrued income and expenses. On 1 July, you need to reverse these entries as follows. Prepaid Expenses Advertising costs [$ inc GST ie $ ex GST] were paid for 12 months August to July. The business needs to account for 1/12 th of the amount [$37.50] which is paid for the next financial year to report the correct amount for the 2009 financial year. You made the following entry in Unit 4. June 30 Prepaid Expenses Advertising {Account for advertising paid for July] The Advertising account now looks like this. [Unit 6] 610 ADVERTISING 31/7/08 Cash Payments CPJ Dr 30/6/09 Prepaid Expenses GJ Dr Drawings GJ , Dr Profit and Loss A/c GJ 1, However $37.50 advertising should be accounted for in July and the Prepaid Expenses account should be 0. You therefore need to reverse the above entry see next page. 118 Unit entries A STEP BY STEP APPROACH TO PREPARING FINANCIAL REPORTS [manual and MYOB] Copyright Marian Brown 2008

5 You need to enter this reversed entry July 1 Advertising Prepaid Expenses (Reverse adjustment on 30 June) This journal should be posted to the Advertising account to look like this for the 2010 financial year. 610 ADVERTISING 30/6/09 Profit and Loss A/c GJ 1, /7/09 Prepaid Expenses GJ Dr This journal should be posted to Prepaid Expenses to look like this for the 2010 financial year. 145 PREPAID EXPENSES 30/6/09 Advertising GJ Dr 1/7/09 Advertising GJ Now the ledger reports the correct information. Copyright Marian Brown 2008 A STEP BY STEP APPROACH TO PREPARING FINANCIAL REPORTS [manual and MYOB] 2010 Entries Unit 8 119

6 Reversing Balance Day Adjustments You are required to: (i) (ii) Record the reversed journal entry under the original entry. Post the entry to the General Ledger accounts to report the correct information for the 2010 financial year. Prepaid Income $1,000 [ex GST] has been paid and recorded in Sales for work not yet done. The business wishes to report the exact sales amount. June 30 Sales 1, Prepaid Income 1, (Account for income not yet earned) July PREPAID INCOME 30/6/09 Sales GJ 1, , Cr 410 SALES [tyres, accessories] 31/7/08 Accounts Receivable SJ 15, , Cr Cash Receipts CRJ 1, , Cr 1/6/09 Cash Sales CRJ 20, , Cr 30/6/09 Prepaid Income GJ 1, , Cr Trading A/c GJ 36, Unit entries A STEP BY STEP APPROACH TO PREPARING FINANCIAL REPORTS [manual and MYOB] Copyright Marian Brown 2008

7 Accrued Expenses The Lease of Premises is paid on the 1 st of the following month, therefore the lease payment of $1, inc GST [however only the $1,000 is accounted for here] needs to be accounted for in June. June 30 Lease of Premises 1, Accrued Expenses 1, (Account for Lease Payment in July] July ACCRUED EXPENSES 30/6/09 Lease of Premises GJ 1, , Cr 640 LEASE OF PREMISES 31/7/08 Cash Payments CPJ 1, , Dr 30/6/09 Accrued Expenses GJ 1, , Dr Profit and Loss A/c GJ 2, /7/09 1/7/09 Cash Payments [lease] CPJ 1,000.00? Note: When the Lease payment is made in July [accounting for GST] this $1,000 will cancel the $1,000 from the reversed entry so that the amount is not accounted for a second time in the 2010 records. Copyright Marian Brown 2008 A STEP BY STEP APPROACH TO PREPARING FINANCIAL REPORTS [manual and MYOB] 2010 Entries Unit 8 121

8 Accrued Income An Insurance Refund of $400 [no GST involved] is owing and not yet received, however the payment has been made to repair the motor vehicle. June 30 Accrued Income Insurance Refund (Account for Insurance Refund not yet received) July ACCRUED INCOME 30/6/09 Insurance Refund GJ Dr 440 INSURANCE REFUNDS 31/7/08 Cash Receipts CRJ Cr 30/6/09 Accrued Income GJ Cr Profit and Loss A/c GJ /7/09 29/7/09 Cash Receipts [refund owing] CRJ ? Note: When the insurance refund is received in July this $400 will cancel the $400 from the reversed entry so that the amount is not accounted for in 2010 records. 122 Unit entries A STEP BY STEP APPROACH TO PREPARING FINANCIAL REPORTS [manual and MYOB] Copyright Marian Brown 2008

9 Reversing Entries in MYOB Accounting (i) (ii) Open the MYOB data file used in the previous units: BrocksPFR18.MYO. To reverse entries in MYOB you must change the security preferences. (a) (b) Select Setup in the Menu Bar. Select Preferences. (c) Select the Security TAB and select the first option to lock the file. (d) Click on OK to return to the Command Centre. (iii) (iv) Display the Transaction Journal [ General TAB] for 30 June 2009 to 30 June Locate the balance day adjustment entry for Advertising. (v) (vi) Click on the to call up the entry. To reverse, select Edit in the Menu Bar and select Reverse General Journal Transaction. Copyright Marian Brown 2008 A STEP BY STEP APPROACH TO PREPARING FINANCIAL REPORTS [manual and MYOB] 2010 Entries Unit 8 123

10 (vii) Date the entry: 1/7/09. Your entry will look like this. (viii) Click on Record to record the reversal. You now know that this transaction is automatically posted to the General Ledger. (ix) You are now required to call up the 3 remaining balance day adjustments and reverse and record the entries in the same manner on 1 July (x) On completion, unlock your data file so that you can correct errors in the future. Follow the steps in (ii) on the previous page, deselecting the option. Exit MYOB. 124 Unit entries A STEP BY STEP APPROACH TO PREPARING FINANCIAL REPORTS [manual and MYOB] Copyright Marian Brown 2008