Dividends

[Eamonn]

I'm currently on site to prepare year end accounts and have noticed in the chart of accounts that posting code in the nominal ledger for dividends is appearing in operating expenses.<BR><BR>The company employed an outside softwear company to install Line 100 and set up the nominal ledger.<BR><BR>Am I right in thinking that dividend payments form part of the retained profit figure i.e. after calculating net profit?<BR><BR>As yet no entries have been posted (big headache as I have to do all postings as well) and with the volume of work involved do not want to start making adjustments, I would rather that any figures appear in the reght pigeon hole.<BR><BR>Any advice gratefully accepted and replied!!!!<BR><BR>Eamonn<BR><BR><BR>

[DAULBY]

Hi Eamonn<BR>The dividends figure should not be categorised within operating costs. It is a distribution of profits so as you say should be positioned after the profits have been calculated.<BR>Good luck!<BR>Philip

[Eamonn]

Thanks Philip<BR><BR>Guess what on further analysis, the whole structure of the accounts seems to be, let's say not as they should be. Sorry the cash book works!!<BR>

[SHEELAGH]

I've never used Line 100, only Line 50 and Instant. In these two packages, the P&L can only be divided into <BR>1) sales and other income<BR>2) Direct Costs<BR>3) Overheads<BR><BR>So the dividends have to go in the overhead part of the P&L produced by Sage. Am I right about this? or does anyone know differently.<BR><BR>I usually post Dividends, Interest etc to easily identified nominal codes and do a separate P&L on a spreadsheet so that I can report Operating Profit.<BR><BR>Please will someone let me know if I am wrong about the Sage capability

[Alonicus]

Hi Sheelagh <img src="i/expressions/face-icon-small-smile.gif" border="0"><BR><BR>Not sure if I should post in here, as I'm not a member in practice (and new to the forum !), but I've been working with Line 100 for the last 3 or 4 years, or should I say struggling - it was installed for us by a guy who really didn't know what he was doing, and we've been sorting out problems ever since !<BR><BR>You're pretty much right in your understanding of the way it works. There is a lot of flexibility, but in the final analysis, the NL splits into P&L and Balance Sheet codes. Within the P&L codes, you can effectively create up to 9 "types" of account. We've pretty much developed it from the default, where codes starting 01 are revenue, 02 direct costs, 03 for office overheads etc.<BR><BR>On our system, we've got two codes in the 09 range for Dividends Paid (one for each of the two directors), with equivalent codes in the Balance Sheet for Provision for Dividends. The latter is credited and the former debited when a proposed dividend is actually paid to one of the directors.<BR><BR>Somehow, it's set up to report the actual dividends in the right place on the P&L, but I have to be honest and say that it was set up by my predecessor, and I haven't gotten round to going in and looking at which parameter makes this work correctly !<BR><BR>Hope this helps !<BR>