Vendor Ledgers & Accounts Payable

[Cplumley]

This is a two part question: The company I work for has been using Peachtree for the past eight years, not always by someone who was qualified to be doing accounting work. Because of this, several of the vendor ledger balances are not correct. Is there a way to correct these without affecting the current records?

Part 2: My Accounts Payable figure on the balance sheet is different from the Aged Payables report total. Has been for years from what I'm told. The aged payables report is correct. Is there anyway to figure out where the difference comes from?

For the past three years that I've worked here, our tax accountant has questioned me on this, and I can't give him a reasonable answer other than it's always been this way!

[LauraG]

we ran into this problem with our Condo association books. We had no choice but to issue sales invoices to credit/debit the incorrect balances. We never figured out a way to post them without impacting current year results. We were lucky that the A/R and A/P adjustments neted to a credit of 2K on our Income statement.

Our A/R balance and aged report were out of wack. Ours was caused by our accountant repeatedly fixing the Property Managers' mistakes by doing a Journal entry instead of issuing correctve Invoices. Once the accountant acknowledge his lack of peachtree experiance and his use of JE to fix things we posted one final JE to put the balances back in synch. He is now under strict orders not to do any more JE with out the Treasurer running it by me first. You may not have any choice but to do a JE to fix your books. In our case there were no backups available to go back and check but maybe that would be the first place for you to look. Those JE need to be reversed in current year or 2004 if you have not finalized the year and move forward. Maybe the JE and the correcting invoices will net to an immaterial amount like they did in our case. BTW, we put our adjusting entries to an expense account that we called Prior Year Adjustments.

HTH,
Laura

[Cplumley]

Thank you, Laura. I was thinking along those same lines. I was able to go and look at the journal entries that had been made since the year 2000, and that's exactly what had been going on with the vendor ledgers. Also, on several A/P checks, there were additional payments "applied to expenses" that threw the vendor balances out of wack. Things like deposits and prepayments on invoices that were never entered, etc. It's a mess, and our tax accountant literally almost had a stroke when I mentioned making an offsetting entry to a "prior period adjustment' account to bring it all in line, even though that is exactly what needs to be done. I did make a small ~ $300 general journal entry to correct the A/P figure on the balance sheet. It now matches my accurate aged payables report. Short of starting all over with a new company, I don't see that there's anyway to correct vendor ledgers without impacting the balance sheet and income statement. Thanks again for your help!

[LauraG]

In our case it was over 20k off. We lucked out than when we fixed all of the property managers mistakes to A/R and A/P the end adjustment was less than -2K which worked out in our favor.

[M GO BLUE]

Sometimes starting a new company is exactly the right answer. Making bogus entries to make the balances right...I'm not happy about that either. You can always refer to the old company for detail.

[Lisa_p]

Editing "beginning balances" in maintain vendors affects the vendor ledger balance with no impact on the G/L.