[GNC] Will adding a transaction dated earlier than the last reconciliation cause a problem?

[Dr. David Kirkby]

On Sat, 7 Jan 2023 at 23:15, Adrien Monteleone <
adrien.monteleone at lusfiber.net> wrote:

> Yes, the principle of Materiality.


The link Geoff gave was quite useful to me. I have noticed some differences
between my calculations and my accountants before. He has replied “That
will be reflected in next year’s accounts”. It was only £5.59, but I knew
could not be explained by rounding errors.

Now this maybe a misunderstanding on my part, and may depend upon the
jurisdiction, but here’s one example. For my last years accounts (ending
February 28th 2022), the money in the bank account at the end of the
financial year was X. He submitted X to Companies House. Yet there were two
transactions shown on the bank statement on 1st March, but shown with a
date in late February. I thought he was supposed to include those two
transactions in last years accounts, but he didn’t. He has not answered my
email on the topic. He probably determines that they are immaterial, as
they total about £15.

>
> It isn't worth spending time looking for small errors. Just adjust them
> out and move on.


That would niggle me. In any case, I would not know how to adjust it
properly.

My background is science, (I have a Ph.D not a medical degree). A number of
scientific discoveries have been made by people who refuse to ignore things
that could easily have been dismissed as insignificant. I suppose that I
need to get out of that habit when chasing immaterial amounts of money.

>
> Otherwise, I'd say enter the transaction on what you think is the proper
> date and re-reconcile.


That’s what I have now done. I stuck the earlier date. I don’t have any
record of the cancellation - I didn’t record it and Royal Mail didn’t email
me any confirmation of the cancellation. But I know that £0.60 was the fee
to get a parcel collected, so I knew what it would be.


> But that begs the question, how did you reconcile without it?


The truth is that in this point in time, I am trusting the bank’s records
more than my own when it comes to small things like that, as I would not
have bothered recording that I sought a £0.60 refund. The only reason I
would bother going to the Royal Mail website and cancelling the pickup
would be to save the postman a wasted journey. I would not have bothered
recording it in my spreadsheet. But now I am using GnuCash, I will record
these sorts of things.

>
> If you had to make an adjusting entry, that will also need to be edited
> or deleted.


I will have to find out how to handle adjustments. It is an area of
accounting that I don’t understand, but are willing to learn.

Regards,
>
Adrien


Dave.

> --
Dr. David Kirkby,
Kirkby Microwave Ltd,
drkirkby at kirkbymicrowave.co.uk
https://www.kirkbymicrowave.co.uk/
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