This section describes how to design and print the Profit and Loss, Balance Sheet and Cash Flow reports.
The first two reports display the profits earned in a business in a given period and the third report projects cash flow for up to five years in advance.
This summarises all sales made to customers during the period. All expenditure of the organisation is listed under the various headings.
Note: Expenditure is listed regardless of whether invoices have been paid.
The profit or loss is found by deducting one total from the other.
The Profit and Loss report uses the posting and memorandum nominal account values that are stored specifically for Profit and Loss reporting.
This compares the net worth of the business at the end of the period with that at the beginning. The net worth is calculated by subtracting the liabilities of the business from the assets. Assuming that no funds have been injected into or withdrawn from the business by the proprietors during the period, the increase in net worth represents the total profit earned. How the profit has been earned is analysed in this report.
The Balance Sheet report uses the posting and memorandum nominal account values that are stored specifically for Balance Sheet reporting. It also includes an accumulated balance from all Profit and Loss accounts. This represents the value of net profit/loss for the period.
You can also design and print a Cash Flow report, showing the projected cash flow for up to five years in the future.
This allows you to project your cash flow from the present year to five years in advance, based on your Sage 200 budgets. Values are per accounting period, not calendar month.
For each accounting period, you can see:
For the first period this is the actual balances for the nominal accounts, nominated as bank or cash accounts in the cash flow layout. The values used are the actual balance at the end of the period before the first period on the report.
For all other periods, the opening cash balance is the closing cash position from the previous period.
This value is based on the budgets for the nominal accounts associated with the income heading.
This value is based on the budgets for the nominal accounts associated with the income heading.
This is the opening balance plus (total cash receipts less total cash paid out).
The Cash Flow report uses the actual balances for the nominal accounts, nominated as bank accounts in the cash flow layout.
Nominal Ledger budgets for labour costs represent the gross wage. The NI and PAYE elements are typically paid to the government in a period after the one in which the net wage is paid to the employee.
You cannot split the budget in a period and apply a different period shift to a proportion of it. Cash flow reporting is suitable for businesses where wage costs remain relatively constant from period to period, however, if a business has considerable variance in wage costs from period to period, you can use the cash flow report as a basis and make adjustments to it, using Excel.
The budgets stored in the Nominal Ledger for income and expenditure are exclusive of VAT.
You cannot apply a VAT uplift to the budget values but you can ensure that the cash flow includes VAT by using report categories and specially created nominal accounts to support the cash flow report. Two examples are shown below. You can either show VAT separately on the cashflow report (Example 1) or include it with the cost and revenue accounts (Example 2).
Your nominal accounts and report categories are set up as follows:
|
Nominal Account |
Report Category |
Budget For Period |
|---|---|---|
|
Revenue Type A |
31 |
1000 |
|
Revenue Type B |
32 |
2000 |
|
Output VAT |
261 |
600 |
|
Cost Type A |
41 |
500 |
| Cost Type B | 42 | 1000 |
|
Input VAT |
262 |
300 |
The cashflow report for the period will show:
|
Balance B/F |
10000 |
|
Revenue A (excluding VAT) |
1000 |
|
Revenue B (excluding VAT) |
2000 |
|
VAT On Sales |
600 |
|
Total Income |
3600 |
|
Cost Type A (excluding VAT) |
500 |
|
Cost Type B (excluding VAT) |
1000 |
|
VAT On Cost |
300 |
|
Total Outgoing |
1800 |
|
Balance C/F |
11800 |
Your nominal accounts and report categories are set up as follows:
|
Nominal Account |
Report Category |
Budget For Period |
|---|---|---|
|
Revenue Type A |
31 |
1000 |
| VAT Revenue Type A | 311 | 200 |
|
Revenue Type B |
32 |
2000 |
|
VAT Revenue Type B |
321 |
400 |
|
Cost Type A |
41 |
500 |
|
VAT Cost Type A |
411 | 100 |
| Cost Type B | 42 | 1000 |
|
VAT Cost Type B |
421 |
200 |
Note: You need to create further nominal accounts to represent the VAT for each revenue and cost item. These VAT accounts can either use the same report category as the associated revenue and cost items or they could use separate codes as in the example. The report layout allows the report categories to be grouped so that either approach is supported.
The report categories with the same stem (for example, 41, 411) are amalgamated in the report calculations. The cashflow report for the period would show:
|
Balance B/F |
10000 |
|
Revenue A |
1200 |
|
Revenue B |
2400 |
|
Total Income |
3600 |
|
Cost Type A |
600 |
|
Cost Type B |
1200 |
|
Total Outgoing |
1800 |
|
Balance C/F |
11800 |
Steps in this task
How financial statement layouts are constructed
Maintain cash flow report layouts
Maintain balance sheet/profit and loss layouts
Reference