Bad Debt - Profit and Loss and Tax Liability Report not balanced

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KirstyD
KirstyD Member Posts: 16

Hi,


I have $2030.10 (all debt is FRE) sitting in the bad account from Jan 2021. This was to clear some invoices which weren't paid.

I have entered the bad debt account as mentioned in other posts but my profit and loss and tax liability report are still out by this amount.


My sales on Tax Liability report are showing $2030.10 LESS THAN my Profit and Loss income.


Any help would be appreciated to get this to match.

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  • Acctd4
    Acctd4 Accredited Partner Posts: 3,483 Reckon Accounts Hosted Expert Reckon Accounts Hosted Expert
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    This suggests that although you've coded the bad debt transaction as FRE, the original sale wasn't (eg sale was coded as GST)! 

    The bad debt entry needs to be an exact match of the original (in reverse) in order to clear/offset the multiple components (income/GST) correctly

    Shaz Hughes Dip(Fin) ACQ NSW, MICB

    *** Reckon Accredited Partner (AP) Bookkeeper - specialising EXCLUSIVELY in Reckon Accounts / Hosted ! ***

    * Regd BAS Agent (No: 92314 015)* ICB-Certified Bookkeeper* Snr Seasonal Tax Consultant since 2003 *

    Accounted 4 Bookkeeping Services

    Ballajura, WA

    shaz@accounted4.com.au

    https://accounted4.com.au

    (NB: Please give my post a Like or mark as Accepted Answer if I have been able to resolve your query as this helps others when seeking solutions!)
  • KirstyD
    KirstyD Member Posts: 16
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    Thank you for your response. The original sale was definitely FRE. No GST was applied.

    Could it be that the bad debt adjustment note was made in a different quarter than the original invoice which was generated?

    If so, how do we balance this?

    Thanks

    Kirsty

  • Acctd4
    Acctd4 Accredited Partner Posts: 3,483 Reckon Accounts Hosted Expert Reckon Accounts Hosted Expert
    edited April 2021
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    Have you “applied” the Adj Note to the invoice? If the adj note is dated in a different period, that will (correctly) be the case.

    It may be that your default financial reports are set to a different basis than your tax reports. Try running all reports on the same basis (eg all “Accrual” or all “Cash”)

    Shaz Hughes Dip(Fin) ACQ NSW, MICB

    *** Reckon Accredited Partner (AP) Bookkeeper - specialising EXCLUSIVELY in Reckon Accounts / Hosted ! ***

    * Regd BAS Agent (No: 92314 015)* ICB-Certified Bookkeeper* Snr Seasonal Tax Consultant since 2003 *

    Accounted 4 Bookkeeping Services

    Ballajura, WA

    shaz@accounted4.com.au

    https://accounted4.com.au

    (NB: Please give my post a Like or mark as Accepted Answer if I have been able to resolve your query as this helps others when seeking solutions!)
  • KirstyD
    KirstyD Member Posts: 16
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    As the adjustment notice is dated in a different period this must be the reason why it doesn't balance. would you agree?

    how do I balance the sales for that period before I lodge BAS? or do I just enter the total sales from the Tax Liability Report rather the Profit and Loss into my BAS sheet?

    Thanks

    Kirsty

  • Kris_Williams
    Kris_Williams Member Posts: 3,400 Reckon Accounts Hosted Expert Reckon Accounts Hosted Expert
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    Always use tax summary report or tax liability- my preference is the tax summary though. Unless you’re on accrual basis the figures from P & L will mostly disagree with tax reports

  • Acctd4
    Acctd4 Accredited Partner Posts: 3,483 Reckon Accounts Hosted Expert Reckon Accounts Hosted Expert
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    Always use the Tax Reports for BASs.

    IMPORTANT: Be mindful of the reporting basis (eg Cash or Accrual) & also your default GST display setting (Net or Gross) & ensure your RAH reports & BAS reporting matches!

    Shaz Hughes Dip(Fin) ACQ NSW, MICB

    *** Reckon Accredited Partner (AP) Bookkeeper - specialising EXCLUSIVELY in Reckon Accounts / Hosted ! ***

    * Regd BAS Agent (No: 92314 015)* ICB-Certified Bookkeeper* Snr Seasonal Tax Consultant since 2003 *

    Accounted 4 Bookkeeping Services

    Ballajura, WA

    shaz@accounted4.com.au

    https://accounted4.com.au

    (NB: Please give my post a Like or mark as Accepted Answer if I have been able to resolve your query as this helps others when seeking solutions!)