Accounting query

[andy thomas]

I've been trying to resolve an accounting problem which might actually be
quite trivial but none of the accounting or book keeping books and
websites I've looked at make any mention of this so I thought I'd ask
here even though it's slightly off-topic. Someone may know the answer...

I set up a small UK limited liability partnership (LLP) and instead of
putting in an initial sum of money as start-up capital (equity), I paid
various partnership bills from both my personal funds and from another
business. How should this be accounted for (if at all)?

One way of looking at it is to regard it as a gift and not account for it
at all. Another way is is to set a limit for these payments, say 5000 ukp,
and operate a separate "loan" account with an opening balance of 5000 ukp
and debit the bills I or my other company pay from this. Accounting books
do mention what to do with loans from partners to their partnerships but
in this case there is no physical loan of 5000 ukp has ever been made -
it's a sort of virtual loan.

A third way is to view these payments as a debt that the partnership must
one day repay, even though I've no intention of asking for it back as it's
in lieu of start-up capital.

Are there any accountants here who might have suggstions?

cheers,

Andy

-------------------------------------------
Andy Thomas,
netstat -a llp

Tel: +44 (0)7815 060872
Fax: +44 (0)20 8372 2582
http://www.netstat-a.net

...applying the glue that holds it together