Accounts Question

[kathynewman]

Quick Question: When doing your invoice filing (from suppliers) do you file by date of invoice or date paid? Just catching up on some filing and there are invoices which are dated before end of financial year but are paid in the next financial year and can't decide which way to file them!

Have this query every year so thought out of curiosity i would see what others do!

Kathy

[Darren B]

Hi Kathy

For accounts we file by invoice date not by payment date

D

[kathynewman]

Thanks Darren - what do you do if you have a batch of invoices which you pay that are spread over the 2 financial years?

[leehack]

Spread them over the 2 years Kathy.

[Darren B]

LMFAO

OK i miss understood your question, i thought you were meaning you sold stuff and raised the invoices not the other way around.

But it go's by the date of the invoice the tax point, if you pay before the invoice is generated then its the date the payment was made

[leehack]

But it go's by the date
I take it he has gone to school now? :D

[acompton]

Kathy,

I suspect it depends on what VAT accounting method you use. The invoices would need to be filed in the VAT quarter in which they were claimed.

[chris ashdown]

You will often need to find a invoice for either your accountant or heaven forbid the vat man.

It would be hard to find if you do them by payment date as you need to trace the invoice to then find when it was paid

If you store by invoice date then every thing is in the logical order and easy to find

Payment date does not come into it even if spread over two years as your accounts will show it as debters due at the end of the year if not paid

[kathynewman]

Thank you everyone - as clear as mud :D

Off now to find a staple remover and a pen so I can unstaple all those batches where the cross the financial years and write on each one when and how paid and file in the appropriate folder.


Kathy

[leehack]

Whichever method you follow Kathy, just be consistent, whether you are coming up to year end or not. You and everyone else will always know the situation then.

[Mike Hughes]

From an accounting perspective, the liability for an invoice occurs on the date that the invoice is issued, not when it is paid.

So, yes, they should be filed under the date issued and similarly that's the date that should be entered in your accounting program.

Mike

[Darren B]

I agree mike, but some companies do cash accounting which means you have to record the date payment was made if it is before the invoice date.

I don't know much about it but there is something in the VAT man's books about receiving payments before invoices, it closed a loop hole were people used to defer raising invoice by months but had already taken the cash, its a very unused practice these days. As i said i dont know much about it

I take it he has gone to school now? :D

PO you cheeky bugger

[Quantum]

Or you could give each invoice a numerical reference number and file in that order. Then ensure you have somewhere in your accounts system to store that reference number against the invoice entry.