Home› Accounting› Accounting Technical Support

Am I doing this right? Cash on hand from previous financial year.

AndyKAndyK Member Posts: 18

I'm just giving Wave a try to see if it suits me.

In my first month of this financial year which started on 6th April my business bank account, which is synced in Wave, shows a cash paid in transaction. This transaction included some cash from an invoice already accounted for in the previous year. What I have done is set a starting with balance, with Owner Equity, for Cash on hand, and in the bank transaction split it so that part of it is a transfer from Cash on hand, and the rest will be treated as new income for this year.

Hopefully this means that I keep the bank transaction accurate but the bit of cash that is from last year won't count as income for this year.

Does that work?

in Accounting Technical Support

Comments

  • AlexiaAlexia Member Posts: 3,314 ✭✭✭✭

    Hi, @AndyK.

    I'm not entirely sure I understand what you're trying to do. Could you share some screenshots to accompany your explanation?

    Can you also give me more details on what you're trying to represent in the real world? Wave doesn't handle year-end like most other accounting platforms do. We don't close out years at all, so you'll still be able to modify your past transactions without issues.

  • AndyKAndyK Member Posts: 18

    HI Alexia,

    Thanks for your reply.

    Since my original post I realised that I was making things more complicated than they need to be.

    I use cash accounting rather than accrual and understand Wave doesn't completely support that, but as I have very few transactions that span financial years I can deal with it.

    In this case I had a bit of cash that had been accounted for in the previous financial year using another accounting system and the figures submitted to HMRC. This amount of cash had not been paid into the bank until this year in a transaction that includes other cash. In Wave the cash from last year will appear to be income for this year. I realise now that I don't really need to specify exactly where the cash in the bank transaction from, just that it's a transfer from Cash on Hand.

    As long as Cash on Hand covers the transfers to bank then it's fine. I think I'm okay with that now.

  • AlexiaAlexia Member Posts: 3,314 ✭✭✭✭

    Hi, @AndyK.

    That sounds fine to me! Let me know if there's anything else I can help with :)

Sign In or Register to comment.