Accounting Help

[gidalene@gmail.com]

I would like to enquire how to do an adjustment in our books due to the following scenario:-

We sold our Trade finance Book for R8 million

- Our buyer transferred the full R8 million into a trust account with Van Der Spuy Attorneys.

- These trade finance clients had bonds as surety and we only accepted payment once their bonds were cancelled and re-registered in the buyers name.

- At the same time Cape Capital owed Seefa (our main funder) R9 million in arrears.

- The agreement was that settlement of the Trade Finance is paid directly from the Trust Account Seefa


The Trust account is not on our balance sheet. The fact that the transfer was done directly to seefa, we are unable to allocate our clients as paid in our books

Which means we cannot reconcile our client balances and Seefa loan balances.

If anyone can assist, it would greatly be appreciated.

[Dave A]

We sold our Trade finance Book for R8 million

Is "We" and Cape Capital one and the same?

[gidalene@gmail.com]

Yes it is Cape Capital

[Dave A]

OK then.

- The agreement was that settlement of the Trade Finance is paid directly from the (attorney's) Trust Account (to) Seefa

The attorney's Trust Account is effectively managing the funds on your behalf, and I expect the attorneys are sure to provide you with a statement of your transactions through the trust account. So ultimately you need to process these transaction as if the funds transferred through the trust account had been transferred through the company.

You could use a bank account called Contra Account in your management accounts as a generic solution - or you could open a bank account in your books called Van Der Spuy Attorneys Trust Account.