Investment correct accounting entry

[nbhatt]

Hi all

Can you please tell me how to show Investment/Expense accounting entry.

My accountant has shown 50,000 cash in Hand as directors loan for 2014 and 2015 and has deducted all business expense from actual sales i.e revenue. Is there a way to reverse this entry or is this the correct way of showing accounts.
Please guide.

regards,

[live4pride]

Hi,

Does it mean you still have 50K for investment untouched as Cash. If yes, then you will need to transfer those from personal to Business under your name(as per UKVI requirement). He can still show 50K as DL but under different section and your End of year closing balance will be 50K plus assuming you have some sales coming in as well.

This is my understanding of your statement. Wait for Gurus to resspond.

Regards

[nbhatt]

ok i will wait for gurus. 50 K has been transferred from my personal ac to business bk ac but in the balance sheet 50 k has been shown as Directors loan. all business expenses has been deducted from revenue. Can this be considered to score points if not what is the way to amend the accounts.

pls guide
regards

Hi,

Does it mean you still have 50K for investment untouched as Cash. If yes, then you will need to transfer those from personal to Business under your name(as per UKVI requirement). He can still show 50K as DL but under different section and your End of year closing balance will be 50K plus assuming you have some sales coming in as well.

This is my understanding of your statement. Wait for Gurus to resspond.

Regards

[live4pride]

Looking at it it appears your accountant need to amend few details. Lets see what other members say on this!

[zimba]

Yes as long as it appears as required by the rules in your accounts: http://www.immigrationboards.com/uk-tie ... 08860.html

[samaygrg]

[quote="nbhatt"]ok i will wait for gurus. 50 K has been transferred from my personal ac to business bk ac but in the balance sheet 50 k has been shown as Directors loan. all business expenses has been deducted from revenue. Can this be considered to score points if not what is the way to amend the accounts.

Balance sheet is supposed to show up the actual amount that you paid in to the business as DL, that's the way it goes. That means, the company owes you that amount. In my opinion that recording is totally fine.

Even if your B/S shows Cash assets' net value £50K recorded, there is nothing wrong. Zimba88 and others have well explained in the prev posts that your invested amount can remain partly spent or untouched if your business is generating more than its expenses genuinely.