Directors Loan Account

Question

Hi There, 
 
 I was hoping someone could help me with the following; 
 
 My Manager is paid mileage and expenses every month but took more out recently and would like to put this amount against the Directors Loan Account. Can someone please tell me how to go about this? 
 Do I set up a fake bank account and call it DLA Clearing and do a payment into the DLA account and do a purchase invoice into the mileage account in order to clear this. 
 Is this the best way to go about this - is there anything else I should be thinking about? 
 
 Thanks a mil, 
 Claire

Paul Morgan · Answer

Hi Claire,

Before you record this, ensure that the following nominal codes exist in the accounts:

Nominal Code

Name

Management report

Section of Chart of Accounts

1200

Bank Account

Balance Sheet

Current Assets / Liabilities

2301

Director's Loan

Balance Sheet

Long Term Liabilities

If the loan is to be repaid within one year, it should be set up as a Current Liability.

If a nominal code does not exist you must create a new nominal code in Nominal codes > New/edit.

To then record the loan payment to your Manager:

On the navigation bar click Bank accounts then click Bank payment.
Enter the relevant information into the Bank Payments window, for example:

Bank	Date	Ref	N/C	Details	Net	T/C	Tax
Bank account you're making the loan from	Date	Ref	2301	Loan made to <<Manager’s name>>	Amount	T9	0.00Click Save then click Close.

3. Click Save then click Close.

To record re-payment of the loan:

On the navigation bar click Bank accounts then click Bank receipt.
Enter the relevant information into the Bank Receipts window, for example:

Bank	Date	Ref	N/C	Details	Net	T/C	Tax
Bank account the money is paid back to	Date	Ref	2301	Loan repayment - << Manager’s name >>	1,000.00	T9	0.00Click Save then click Close.

3. Click Save then click Close.

If this has answered your question, please click on the ‘This helped me’ link below.

Sage 50 Accounts

Directors Loan Account

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