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VAT unreconciled transactions

Bookkeeping and Management Accounting help does not have to be specific to the use of Sage 50
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chopin_fanatic
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VAT unreconciled transactions

Post by chopin_fanatic » 22 Feb 2017, 09:17

When I took over the job, there were some 3000 VAT unreconciled transactions on Sage. I have limited experience dealing with this and need some help how to deal with these. Program in use is Sage 50 essentials v23.

Files were imported at some stage to this version of Sage from a previous version. The date modified for Sage.usr file is 15/04/2015, which suggests this is the date the files were imported (according to Sage support adviser).

Transaction dates are as old as 2010. First VAT return on this current version of Sage is July-September 2015. We have physical records of VAT returns dating back to 2010, albeit some periods are missing from the folder.

I'm wondering if most of these transactions were left unreconciled when the files were imported. I'm looking for a quick way to understand what has most likely gone wrong, without going through each and every transaction yet at this stage. Any ideas to help or where to get started?

chopin_fanatic
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Re: VAT unreconciled transactions

Post by chopin_fanatic » 22 Feb 2017, 11:10

Regarding date that Sage files were imported, one confusing part is that opening balance transactions all date to Jan 2009!! Super confusing why VAT returns only start at 07/2015..

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brucedenney
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Re: VAT unreconciled transactions

Post by brucedenney » 22 Feb 2017, 16:22

It sounds to me like someone has not reconciled the VAT returns after creating them in Sage.

If you are confident that the VAT return had been done correctly prior to 2010, I would do a vat return for the period up to 2010 and reconcile it.
Then run the VAT returns for each period that you have records for again and reconcile each, they should match, but with backdating of transactions it is possible that there could be differences. If there are small differences then note them.

Add up all the differences on all the returns you have checked and add them on to the next return.

The next return should be run and reconciled in sage, and the differences added on. This should make all the returns since 2010 in Sage match those that had been submitted.

In an ideal world, you should have a qualified accounting professional oversee this.

If the amount of the differences is significant, then you should contact HMRC so they can inspect.
They do not penalise you for historical issues if you declare them, but if you try to cover things up then they can throw the book at you, so generally best to let them know of any issues, or at least seek qualified advice from a qualified accountant.
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chopin_fanatic
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Re: VAT unreconciled transactions

Post by chopin_fanatic » 23 Feb 2017, 08:34

Hi Bruce,

Thanks for your response, those are good ideas. I will run the returns out of interest, but I agree about getting a professional to sort it out. I will forward it on to our accountant.

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