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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: UK Tax
Satisfied Customers: 3584
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based)
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Hi I am trying to return the Financials to companies House

Resolved Question:

Hi
I am trying to return the Financials to companies House but keep getting the message "Shareholders' funds must be equal to the total net assets (liabilities)". I dont understand why they should tally as the P and L has little association with debtors etc? any help would be most appreciated!
Submitted: 8 months ago.
Category: UK Tax
Expert:  taxadvisor.uk replied 8 months ago.
Hello and welcome to the site. Thank you for your question.

I presume you are filing abbreviated accounts for small companies.
Please advise what figures have been input on the balance sheet page

Balance Sheet this year last year
Fixed assets
Tangible 0 0
Intangible assets 0 0
Total fixed assets 0 0
Current assets
Cash at bank and in hand 0 0
Total current assets 0 0
Creditors: amounts due within 12 months 0 0
Net current assets 0 0
Total assets less current liabilities 0 0
Total net assets 0 0
Capital and reserves
Called up share capital 0 0
Profit and loss account 0
0
Shareholders funds 0 0

many thanks
Customer: replied 8 months ago.

Hi,


 


thanks my head is wrecked with it all!


 


Fixed Assets = 0 to all


 


Current Assets= 600 717


Cash at Bank= 763 218


Total Current Assets= 1363 935


 


Creditors Due within 12 months = 1407 1554


 


Net Current Assets= (44) (619)


 


Total Assets less Current Liabilities= (44) (619)


 


I also have a creditor of plus 1 year as only 554 of last years has been paid)


(1000 ) 0


 


Total Net Assets (1044) (619)


 


 


 


Called up share capital 1000 1000


(not really sure what this is but last year an accountant did this for me but cant afford it this year !and he put a thousand so I have done the same)


 


Profit and Loss account (1207) (1619)


Shareholders Funds (207) (619)


 


Many thanks!!


 



 



 


 

Expert:  taxadvisor.uk replied 8 months ago.

Jane, thank you for your reply and additional information..

There is a difference of £837 as shown below.. total net assets/liabilities do not agree with shareholders' funds..

Balance Sheet

this year

last year

Fixed assets

Tangible

0

0

Intangible assets

0

0

Total fixed assets

0

0

Current assets

Stock

0

0

Debtors

600

717

Cash at bank and in hand

763

218

Total current assets

1,363

935

Creditors: amounts falling due within 12 months

-1,407

-1,554

Net current assets

-44

-619

Total assets less current liabilities

-44

-619

Creditors: amounts falling due after more than one year

-1,000

0

Total net assets

-1,044

-619

Capital and reserves

Called up share capital

1,000

1,000

Profit and loss account

-1,207

-1,619

Shareholders funds

-207

-619

difference

837

0

Please confirm the figure for P&L account -1,207 is cumulative loss and not p&l for this year.

Also confirm the creditor not paid from last year is not duplicated in both creditors due within one year and creditors due after more than one year.

If after your review you conclude that
Current assets are correctly stated
P&L balance is cumulative position

then I would change the creditors due falling within 12 months to read -1570 and nothing in creditors due after more than one year..

The new balance sheet will look like

Balance Sheet

this year

last year

Fixed assets

Tangible

0

0

Intangible assets

0

0

Total fixed assets

0

0

Current assets

Stock

0

0

Debtors

600

717

Cash at bank and in hand

763

218

Total current assets

1,363

935

Creditors: amounts falling due within 12 months

-1,570

-1,554

Net current assets

-207

-619

Total assets less current liabilities

-207

-619

Creditors: amounts falling due after more than one year

0

0

Total net assets

-207

-619

Capital and reserves

Called up share capital

1,000

1,000

Profit and loss account

-1,207

-1,619

Shareholders funds

-207

-619

difference

0

0

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 8 months ago.

Hi,


what a great service this is!


so the P&L number is XXXXX? last year was the first year of trading and the accountant just put in the loss as 619 as per sales minus all the costs.


So would the P& L number be (619) from last years loss and (1207) this years loss thus (1826) as a cumulative for this years P & L figure?

Customer: replied 8 months ago.

this years 1407 is new debt put in to keep the company running and it still owes £1000 from last year so those figures are right. How can we just change the 'Creditors owing within 12 months' to 1570 when the correct number is XXXXX? Many thanks

Expert:  taxadvisor.uk replied 8 months ago.

Jane, thanks for additional information.

I have looked at your numbers again.. there still is a difference of 782 on the balance sheet.

Last year profit & loss account showed a loss of 1619 as per your original statement. There is a further loss of 1207 in this year making profit & loss account balance loss 2826 at end of year two.

Issued share capital has remained at 1,000 for both years. One way to confirm this would be to look at what was reported as issued share capital when you filed the company’s annual return to Companies House

Certain numbers from last year balance sheet can't be changed unless they are wrong. Assuming they are correct, then shareholders funds at end of Year two will be as follows:

Capital and reserves

this year

last year

Called up share capital

1,000

1,000

Profit and loss account

-2,826

-1,619

Shareholders funds

-1,826

-619

Now we come to the top part of balance sheet – net assets.

These should equal the total of shareholders’ funds i.e

This year -1826

Last year -619

Your top part of balance sheet reads

Balance Sheet

this year

last year

Current assets

Stock

0

0

Debtors

600

717

Cash at bank and in hand

763

218

Total current assets

1,363

935

Creditors: amounts falling due within 12 months

-2,407

-1,554

Net current assets

-1,044

-619

Total assets less current liabilities

-1,044

-619

Creditors: amounts falling due after more than one year

0

0

Total net assets

-1,044

-619

If you are satisfied that debtors and cash position at end of year two are correct, then the only area left for revision is creditors. You say you put in fresh money in to keep the company running. Did you also pay for certain business expenses and did not repay yourself for expenses out of pocket etc.?

Other than re performing the accounts in full, assuming the following items are correctly stated:

Profit and loss for current year -1207

Total current assets 1,363

No fixed assets

The finger points towards creditors and these will have to be adjusted to make the balance sheet agree.

I am reflecting an adjustment to creditors to make the document balance on the assumption that certain business expenses were also paid for out of pocket etc and you did not repay yourself for these expenses . So the final balance sheet will look like

Balance Sheet

this year

last year

Current assets

Stock

0

0

Debtors

600

717

Cash at bank and in hand

763

218

Total current assets

1,363

935

Creditors: amounts falling due within 12 months

-3,189

-1,554

Net current assets

-1,826

-619

Total assets less current liabilities

-1,826

-619

Creditors: amounts falling due after more than one year

0

0

Total net assets

-1,826

-619

Capital and reserves

this year

last year

Called up share capital

1,000

1,000

Profit and loss account

-2,826

-1,619

Shareholders funds

-1,826

-619

difference

0

0

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 8 months ago.
Hi
Sorry it's all so confusing. Yes all of the creditors within one year(1407) are money put in from another company to cover the running costs of the year e.g the bank/sage/internet website costs ( all in P&L) and the cash in bank includes £554 transferred in to pay the accountant from last year which was part of the 1554 debt from last year (which was an accrual really) but they down as a creditor within one year, they have been paid but a week after the year end figure on the bank statement. I'm wondering if anyone at HMRC will care as it makes no money anyway?! Seems daft all this work!
I really appreciate all your help
Expert:  taxadvisor.uk replied 8 months ago.

Jane, thank you for your reply.

You should not worry about whether HMRC will care or not. Based on information already provided by you, the balance sheet I drafted in my last answer would appear to be a true and fair reflection of state of affairs as at end of year two. You can submit it to Companies House/HMRC.

If you are happy and there are no more issues I will appreciate if you would kindly rate the service I provided to ensure I get paid for it.

taxadvisor.uk, Chartered Certified Accountant
Category: UK Tax
Satisfied Customers: 3584
Experience: FCCA - over 35 years experience as a qualified accountant (UK based)
taxadvisor.uk and other UK Tax Specialists are ready to help you
Customer: replied 8 months ago.

ok thanks

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