How To Use The Import Tool
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How To Use The Clear Books Import Tool
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Steps
1. Navigate to the Import Tool page under Tools
2. Select what type of import you are undertaking
3. Upload the file
4. Match up required fields with corresponding data from uploaded file
5. Check the import is correct and confirm
Upload Scanned Expenses and Receipts
To upload an image of a scanned receipt or expense, click on the document attachment link when viewing your list of bills.
You will be presented with a form to select and upload your file.
Once your file is uploaded bills and expenses with an attachment already uploaded will show a different icon. Click on the icon to view the image.
Quickly create and apply a Credit Note against an invoice
If the balance of, or an entire invoice, needs to be credited then there is a quicker alternative to creating a credit note and then applying it against the invoice.
When viewing an invoice to be credited click on the options link in the payment history section:
This will bring up a form where you may credit the balance on the invoice at the click of a button.
On clicking Apply Credit Note the system will automatically create a credit note and apply it against the invoice in question.
Create and apply a credit note against a customer invoice
Creating a Credit Note
To create a credit note navigate to Sales > Invoices > Credit Notes and hit the “New Credit Note” button.
Simply fill out the credit note form in the same way you would complete a new invoice i.e. indicate which customer the credit note is for, the amounts and account codes.
On confirming the credit note it will be available in the system but at this point in time it has not been applied against the original invoice.
Apply a Credit Note against an Invoice
View the original invoice that needs to be credited by clicking on its invoice number in the sales invoice list reached via Sales > Invoices > Unpaid. If an unused credit note exists for the particular customer then an option to allocate a portion, or all of it, against the selected invoice will be enabled. This is found at the bottom of the screen:
In the same way that a payment is allocated against an invoice, the credit note can be alloacted against an invoice.
Credit Notes and the Bank Import Tool
When using the bank import tool as your primary means of bookkeeping you will need to follow the process above to apply a credit note against an invoice in the system. Then when you explain money in against an invoice using the bank import tool the invoice will show the balance net of the credit note.
How to record Corporation Tax in your accounts
If you run a limited company, and the company makes a profit in its accounting year then you will probably need to pay some corporation tax for that year. Your accountant should calculate for you how much tax is due, and in this blog post I will show the best way to record the Corporation tax charge and any subsequent payment in Clear Books.
Let’s assume our company is called Hyper Global Meganet, and that the company’s accounting year runs from the 1st of January (01/01) until the 31st of December (31/12).
Entering the Corporation Tax Charge
Firstly, at year end you will want to accrue the tax charge into the profit & loss account for relevant year. The easiest way to do this is to set up a purchase invoice.
- Navigate to Purchases > Invoicing in the top menu.
- Select “HMRC” as the supplier.
- Enter a brief description in the summary along the lines of “Corporation Tax charge for year ending 31/12/2009″
- Date: This is important – make sure you enter the last day of your company’s accounting year, so in this case it will be 31/12/2009.
- In the first line item, write:
- Details: “Corporation Tax”
- Quantity: 1
- Unit Price – This should be the amount of corporation tax your accountant has calculated
- Select Account: Tax Expense – Corporation Tax
- VAT: No VAT
- Check through everything you have entered, and then click Confirm Invoice to save the invoice.
The corporation tax charge will then be entered as an unpaid purchase invoice. When you have paid the tax, and it shows up on your bank import you can complete the next step.
Entering the Corporation Tax Payment
When you have paid the corporation tax charge it should then appear on one of your bank statements. When you import this statement via our import tool, and then go to explain the payment, you should do the following:
- Select HMRC from the To: box.
- The unpaid corporation tax purchase invoice should automatically appear in the invoice list that pops up.
- Click the “allocate” button to allocate all the payment to this invoice.
- Click the “create transactions” button.
And that’s it! You should now have correctly accounted for your corporation tax.
How To Set Up Purchase Orders
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How To Set Up Purchase Orders
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Steps
1. Navigate to Purchase Orders page.
2. Fill in purchase order details.
3. Click save draft to upload purchase order.
Below is an example of how to set up a purchase order, we will be making a purchase order for 100 folders from Mr Meganet (as seen in the demo account).
Step 1.
To start navigate to Purchases>Purchase Orders.
Step 2.
Fill in the Purchase order details , in this example we have selected Mr Meganet and a purchase order for 100 folders.
What The Purchase Order Options Mean
Project: If this purchase order is part of a project select it here.
PO Date: Enter the date of the purchase order.
Reference: Enter the reference number for this order here.
Step 3.
Once you have filled in the purchase order information click:
If the purchase order is successfully uploaded you should see the following
How To Explain A Bank Transaction Made Up Of Multiple Payments
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How To Explain A Bank Transaction Made Up Of Multiple Payments
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Steps
1. Navigate to Manage Money page.
2. Explain the different payment amounts within the transaction.
3. Repeat explanations for each part of payment until the whole transaction is explained.
4. Click create transaction button and check that the transaction is approved.
Double Entry Accounting; What Is It?
Double Entry Accounting is a form of recording financial transactions for businesses. In its most basic form double entry accounting is a system where all debits and credits must balance. In double entry accounting for every action there must be a reaction within the accounts.
The basic equation by which double entry accounting works is shown below:
Assets = Liabilities + Equity
Effectively for everything a company owns (Assets) there is a claim against it (Liabilities+Equity) whether it be due to owing the bank, or owing a sharholder who has paid money into the company. Liabilities come in the form of both long term (bank loans) and short term (overdraft, trade credit), equity is shown on the balance sheet under shareholder’s capital and represents those that own a part of the business.
Example
A company makes a purchase of £1000 worth of stock, the company takes out a loan for £1000 to pay for this. The purchase of £1000 of stock is a debit and therefore it needs to be countered with a credit, which in this case is the loan of £1000.
This would result in two changes to a companies balance sheet.
- An increase would occur in the company’s long term liabilities (a long term liability is any payment that is owed after 1 year).
- The company would see an increase in stock, this is reflected on the balance sheet through an increase in current assets (a term given to items that can be turned into cash within a year).
Double entry accounting has therefore resulted in the action of purchasing stock having a reaction in the form of an increase in long term liabilities due to the loan.
Double entry accounting can also be seen when a change happens on either side of the balance sheet, for example instead of taking out a loan to purchase the £1000 of stock the company uses cash (which would appear under current assets) to buy the stock. This would then result in an increase in stock and a decrease in cash, both changes occur within the current assets section of the balance sheet.
What is a single entry accounting system then?
The difference between a double entry and a single entry accounting system is basically that a single entry is just that, it does not have another entry to counter it. The total of all transactions are merely added up to give you a profit or loss.
The reasons why you would choose double entry over a single entry accounting system include:
- It is easier to prepare submittable accounts from a double entry accounting system.
- Any mistakes are easier to spot due to the fact that if something is wrong the accounts will not balance, or in other words debits will not be equal to credits.
- Double entry accounting systems allow you to have assets and liabilities recorded.
Computers can do the hard work for you
If you are keeping records by hand then for every purchase or sale you would then have to write down the other side of the transaction. If you are using double entry accounting software then the software will calculate both sides of a transaction automatically, making double entry accounting that little bit easier.
Abbreviated Accounts
Abbreviated accounts can be created automatically from within Clear Books as a pdf report. Limited companies must submit their accounts to Companies House at the end of each financial period. Depending on fulfilling the exemption criteria small companies need only submit abbreviated accounts which are a watered down version of a full set of accounts.
It is strongly recommened that your accountant reviews your abbreviated accounts as abbreviated accounts submitted to Companies House are a legal document. You need to ensure that they are complete and reflect a true and fair view of the company’s financial position. For example, are the accounting records complete with journals to account for the depreciation of fixed assets during the year and a provision for your corporation tax liability?
The data for the abbreviated accounts is generated from the underlying data in Clear Books with company information taken from your Organisation settings page and share structure data entered by clicking on the Edit share structure link as shown below.
How To Transfer Money From One Bank Account To Another
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How to transfer money from one bank account to another
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Steps
1. Select account to transfer from.
2. Enter how much money you are transferring and from which account; click explain.
3. Check details are correct select bank account to transfer to; click confirm transfer.