year end crossover

[Jennajay]

We have crossed over from using external accountants to doing it in house.
They handed over the Pastel files last year in May and I have been doing the Monthly bookkeeping ever since they have now completed last years year end - how do i go about transfering all this info into my set of books?
this might be a silly question? Im not used to the whole pastel system - I know enough to get by....We are in the process of looking for new accontantsto handle the year end etc going forward...

[Neville Bailey]

Hi Jenna,

Can I clarify my understanding of what you are saying?

You have been processing the day-to-day transactions in Pastel since the beginning of the current financial year, and your accountants have now finalised the year ending February 2011. Do you now need to incorporate their final year-end balances into your Pastel database, so that your opening balances tie up with their's?

Let me know if I have understood you correctly, or tell me where I have got it wrong, and we can take it from there.

[Blurock]

Accounting is one of the most important, but most neglected areas in business.

Because accounting is not revenue generating, business owners tend to skimp on cost and often appoint a data capturer as "bookkeeper" when they actually require an in house accountant. What they miss is the risk of wrong invoicing, wrong passing of credit notes, late VAT or tax returns (incurring penalties) etc. This can cost you much more than the few Rand you save by employing under qualified staff.

You also can not manage a business without information. Regular management reports such as sales for the week, debtors and creditors, gross and net profit and cash book is vital information to run a business effectively.

For small business owners who can not afford an in house accountant, my advice is to attend courses and to up skill yourself. Stay close to your accountant and ask for advice when in doubt.

[Jennajay]

@Neville - Yes correct, She has just completed Feb 2011's yearend. They obviously made various adjustments in completing that year end... Is there a simple process for getting this info and inputting it into my system? Or will i need to post all her ledger entries. I am not used to the pastel system so don't know all the tricks....

@ BluRock - I have 3 Majors - One in accounting, one in finance and the other in Economics - but I studied these in order to be able to read AFS's not draw them up, never thought I would be in this position BUT Our previous accountant (who is a CA infact) stuffed up prior years - late payments to SARS as well as late returns filed - documentation missing or not filed etc, when i had a look at our records from SARS there was more payments for penalties and interest than anything else. Everything is now in order and SARS has finally been paid up - we are a very small business with a very uncomplicated accounting structure - no inventory, no foreign transactions etc. We are still trying to figure out why they got it so wrong....

My main Job area is Production - I am just doing this in the interim.

[Neville Bailey]

They obviously made various adjustments in completing that year end... Is there a simple process for getting this info and inputting it into my system? Or will i need to post all her ledger entries. I am not used to the pastel system so don't know all the tricks....

There are two ways in which you can approach this.

Option 1 is to recapture all their adjusting entries, as a prior year journal. This will be the preferred option as you will then have full details of what was adjusted.

Option 2 is simpler. Get hold of the final TB from the accountants, and compare it line-for-line with the TB on your system, as at 28 Feb 2011. Then pass prior year debits and/or credits to get your closing balances to equal your accountant's closing balances.

In order to process prior year journals, open the journal screen and then click on the Settings button below. On the pop-up screen, untick the box named "This Year Transactions", and then click Close. You should see the words "Last Year" in red at the bottom of the journal screen.

If there were adjustments to the cashbook, or supplier accounts, or customer accounts, you will need to open the respective journal types - the rest of the GL adjustments can be done in a General Journal.

After you have updated the journals, your opening balances, including Retained Income, will be adjusted.

[Jennajay]

Thank you so much Neville!! - because of our situation i think it would be best to go with option 1....

[geraldenek]

Jennajay - just be careful with option 1 as not all the journals the auditors/accountants wrote should be included in your journals. Just ask them which ones you should capture in pastel.

[Jennajay]

Thanks geraldenek will be sure to specify this with them...

[Dave A]

Jennajay - just be careful with option 1 as not all the journals the auditors/accountants wrote should be included in your journals. Just ask them which ones you should capture in pastel.

Normally that's just the current portion of long term liabilities, isn't it?

[geraldenek]

no, were they write journals for input of movement on the tb or if they take out the previous year closing balances and input the current year closing balances

[geraldenek]

BUT Our previous accountant (who is a CA infact) stuffed up prior years - late payments to SARS as well as late returns filed - documentation missing or not filed etc, when i had a look at our records from SARS there was more payments for penalties and interest than anything else. Everything is now in order and SARS has finally been paid up - we are a very small business with a very uncomplicated accounting structure - no inventory, no foreign transactions etc. We are still trying to figure out why they got it so wrong....

There is lots of CA's also making a mess of things - i had just sat now for about 2 hours going through financials that was done for one of my monthly bookkeeping clients by an auditing firm which charges them +/- R30 000 a year - got 14 mistakes on it - and the cherry on the cake was an afrikaans line inserted in the income statement on english financials - i just get really fustrated when you pay for something and this is what you get.

interest received - should have been insurance payment received, account names was wrong, 3rd party loans classified under shareholders loan - and so the list goes on - really???

They wrote 4 journals which was the tb, one i gave to them for stock and the other 2 were adjustments that was received after the pastel was handed over to them. I am really starting to wonder if any work was done on this......

[Blurock]

There is lots of CA's also making a mess of things -......

Big firm big problem? Make sure that the size of your accounting firm matches the size of your business. If you are too small for one of the Big 4, you may be fobbed off to a clerk and mistakes are inevitable.

Ensure that your accountant shows an interest and is prepared to understand and discuss your unique situation. We do not all require CA's. A good CFA can often add good value to a small or medium sized business.

[Jennajay]

There is lots of CA's also making a mess of things - i had just sat now for about 2 hours going through financials that was done for one of my monthly bookkeeping clients by an auditing firm which charges them +/- R30 000 a year - got 14 mistakes on it - and the cherry on the cake was an afrikaans line inserted in the income statement on english financials - i just get really fustrated when you pay for something and this is what you get.

interest received - should have been insurance payment received, account names was wrong, 3rd party loans classified under shareholders loan - and so the list goes on - really???

They wrote 4 journals which was the tb, one i gave to them for stock and the other 2 were adjustments that was received after the pastel was handed over to them. I am really starting to wonder if any work was done on this......

This was our greatest peave - In no way were we ever trying to save money on our accounting. Our director had no idea about accounting and the previous producer didn't either so he was happily going along thinking that the accounting aspect of his business was running rather smoothly, he wasnt even aware of what portion of payments were interest/penalty related and what portion were actually from the return - i think its just testimony to the fact that in any company, big or small, its just not acceptable to not know whats going on.

[Blurock]

- i think its just testimony to the fact that in any company, big or small, its just not acceptable to not know whats going on.

Aah, the root of the problem! Not knowing is a sin and a big reason for business failure.

I am amazed at how many business owners do not know what is happening in their business. They have an attitude of "leave it to the accountants" or admin or even production. All they want to do is the easy stuff and they do not make an effort to acquire the skills to run a business effectively.

A business owner does not have to be an accountant, but he needs to get the right management reports and he must ask questions in order to check if things are still on track. Too often we are too scared to crunch the numbers as that may expose our inability to count...?

[Jennajay]

I phoned our accountant to request the data - she sent through a text file and said i should just be able to import it into pastel, I have her Trial balance from last year as well as the adjusting Journal entries so if all else fails i am able to manually input these - although i REALLY am hoping there is an easier option. blegh.
Is there anyway i can import this simply into pastel? help.