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Post Info TOPIC: Journals in Xero


Veteran Member

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Journals in Xero


Good morning,

I'm looking for some help please. I have a client with a bank loan over 7 years. The account is set up with the automatic bank feed. I wish to separate out the sum due with 12m as a current liability and the remainder as a long term liability. Given that Xero will not allow journals form a bank account does anyone know if this is possible and if so how to do it.

Thanks in advance.



-- Edited by BC Boy on Tuesday 13th of August 2019 10:09:36 AM

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Master Book-keeper

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Im lost.

Why would you split out the payments when they will cover the 'on demand' or this current year's element of the loan repayment schedule?

Do you in fact mean how would you split out the interest and the repayment of capital aspects of the loan payment?


I understand from past posts that you are a QuickBooks user - does that extend to QBO? If so perhaps you can help with those queries? There have been a few lately (well, ok all mine!)


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Joanne

Fallows Hall Ltd

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Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.



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Hi,

I'm not splitting out the payments I'm looking to separate current (less than 12 month) liability of the loan from more long term liability within the balance sheet. This is because I wish toreport current and more long term liabilities separatelybecausecurrent liabilities areobligations thataredue within one year of the balance sheet's date andwillrequire cash payment. Thiswillhelp thecompanyto determine the liquidity needs of thecompany.

PS. Easier in QB, either the loan is not posted as a bank account and if it is you can journal from/to the bank. TBH my preference is for the former.



-- Edited by BC Boy on Tuesday 13th of August 2019 12:07:37 PM

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Master Book-keeper

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BC Boy wrote:


-- Edited by BC Boy on Tuesday 13th of August 2019 11:44:19 AM


I dont use zero (my name for it!)

Are you using the software to produce year end accounts?

Can you just do a dummy close down of the loan as a 'Bank' account and re-set the loan to split between two part of the SFP (sorry dont know what they are called in your software - nominals/accounts/pots/whatever)?

If that doesnt work, I might actually suggest something sensible later when Im not in the midst of margin scheme nonesense for a client (perhaps this evening when brain is not wired), unless someone else comes along, although there arent many zero users on here neither.

------------------------------------------------------------------------

Sorry - ignore what I suggested here, wont work for your reconciliation process. Head not in gear!!!!!!



-- Edited by Cheshire on Tuesday 13th of August 2019 01:08:48 PM

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Joanne

Fallows Hall Ltd

Winner - Bookkeeper of the Year 2015, 2016 and 2017

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.



Master Book-keeper

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Hi Lewis.

I would have thought the easiest way is to journal the 12 month element to a suspense account, then on to the loans payable within a year.



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John

Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.



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Thanks but as mentioned cannot journal from a bank account in Xero



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Master Book-keeper

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Leger wrote:
Hi Lewis.

I would have thought the easiest way is to journal the 12 month element to a suspense account, then on to the loans payable within a year.

BC Boy wrote

Thanks but as mentioned cannot journal from a bank account in Xero

___________________________________________________________________________________________________________________

Not what John is suggesting. If you journal to your bank account then surely your bank will never balance to its bank statement.


Might help if you answer my Q

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Joanne

Fallows Hall Ltd

Winner - Bookkeeper of the Year 2015, 2016 and 2017

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.



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Cheshire wrote:
BC Boy wrote:

Hi,

I'm not splitting out the payments I'm looking to separate current (less than 12 month) liability of the loan from more long term liability within the balance sheet. This is because I wish toreport current and more long term liabilities separatelybecausecurrent liabilities areobligations thataredue within one year of the balance sheet's date andwillrequire cash payment. Thiswillhelp thecompanyto determine the liquidity needs of thecompany.

Ah right - I misread the point you were making about the bank feeds and the need to split the account, presumably because you have set the loan up as one bank account rather than just setting up as a liability account (x2) in the balance sheet within the software.

You are talking to an ex corporate financier so I do get what you mean by the 2nd sentence.wink

PS. Easier in QB, either the loan is not posted as a bank account and if it is you can journal from/to the bank. TBH my preference is for the former.

I wasnt actually asking about how to undertake this scenario this QBO - more the fact that we havent got anyone on here who is an expert. Or we may have an expert but they never post unless asking for something themselves.

Ah, sorry. My bad. I'm far from an expert. I have been off the grid for some whilebut will be keeping more of an eye on the forumsobut if i can assist anyone then i will.


-- Edited by BC Boy on Tuesday 13th of August 2019 11:44:19 AM


I dont use zero (my name for it!)

Are you using the software to produce year end accounts?No but the clientsaccountant will.

Can you just do a dummy close down of the loan as a 'Bank' account and re-set the loan to split between two part of the SFP (sorry dont know what they are called in your software - nominals/accounts/pots/whatever)?May haveto use this option.

Ihavemore and more clientsmoving to Xero so it would be good to understand if thereis a legitimate way to handle it.

If that doesnt work, I might actually suggest something sensible later when Im not in the midst of margin scheme nonesense for a client (perhaps this evening when brain is not wired), unless someone else comes along, although there arent many zero users on here neither.




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Master Book-keeper

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PC Boy wrote:

I said:

I would have thought the easiest way is to journal the 12 month element to a suspense account, then on to the loans payable within a year.



Thanks but as mentioned cannot journal from a bank account in Xero


Sorry, I had assumed the loan had been allocated to creditors > loans over 1 year and you wanted to shift the next year into > loans under 1 year. (Don't know the correct descriptions in Xero)



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John

Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.



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Hi Lewis,

V quick as I'm about to run out the door. I don't know Xero at all so this may not work for you. Here's what I'd do in Sage.

I assume the LTL bank account is coded to the LTL section of the COA. I'd set up two accounts. One would be an "offset" account in the LTL section. The other would be the "within 12 months" liability within Current Liabilities. The COA would group the two LTL accounts together. Then you just Dr the "offset" account and Cr the "within 12 months" account to achieve the appropriate disclosure. That way you're not having to journal to the bank account and you continue to reconcile it as normal.

Regards,

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Ian

Ian Brown FCA
Onion Reporting Software Ltd

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Sage accounts in Excel. No set-up necessary. Free trial.



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Rather than posting as a journal, could you post the transfer amount as a bank receipt from the LT loan liability? I'm not sure whether that might affect the bank feed though?

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Onion4Sage wrote:

Hi Lewis,

V quick as I'm about to run out the door. I don't know Xero at all so this may not work for you. Here's what I'd do in Sage.

I assume the LTL bank account is coded to the LTL section of the COA. I'd set up two accounts. One would be an "offset" account in the LTL section. The other would be the "within 12 months" liability within Current Liabilities. The COA would group the two LTL accounts together. Then you just Dr the "offset" account and Cr the "within 12 months" account to achieve the appropriate disclosure. That way you're not having to journal to the bank account and you continue to reconcile it as normal.

Regards,


Spot on Ian!

Although I would suggest if you are only doing bookkeeping to leave it to the Accountants who will do the necessary under the Extended Trial Balance (ETB) process.

Unless you have a desperate need to have them separate in the management accounts, assuming you produce them.



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Joanne

Fallows Hall Ltd

Winner - Bookkeeper of the Year 2015, 2016 and 2017

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.



Master Book-keeper

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Rachel19 wrote:

Rather than posting as a journal, could you post the transfer amount as a bank receipt from the LT loan liability? I'm not sure whether that might affect the bank feed though?


That would cause an issue for the Bank rec methinks



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Joanne

Fallows Hall Ltd

Winner - Bookkeeper of the Year 2015, 2016 and 2017

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.



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Thank you all for your time and consideration.

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That's what I was afraid of. The bank feed could be turned off for the loan account if necessary, which would eliminate that problem. I see a better solution has been found though so no need to tinker with what's already there!



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