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Posting to Reserve

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Geegeelup
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Posting to Reserve

What is the correct way in MYOB to post a part of current year earnings to a reserve account rather than to retained earnings?

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IanChait
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Re: Posting to Reserve

Hi @Geegeelup 

 

What is this reserve for?

 

To record against current year income,  create a 9-XXXX Expense account, and then a 3-XXXX Equity Account for the Reserve. Record a General Journal, Debit the Expense Account, and Credit the Reserve Account.

 

There are other ways to record a Reserve, depending on what it is for. 

 

 


Regards
Ian Chait CA
Certified Consultant Melbourne
P/M 0417 479 585
Email ian@myfc.com.au

Geegeelup
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Re: Posting to Reserve

Thanks Ian,

It's a future capital expansion reserve. I have done it that way but then my P&L is not technically correct so was just wondering if a posting direct to Retained earnings rather than an Other Expense was an option in MYOB.

Steven_M
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Re: Posting to Reserve

Hi @Geegeelup 

 

From an MYOB Support point of view, users can directly record transactions to the Retained Earnings account.

 

The only account that you wouldn't be able to generate a transaction to would be the Current Year Earnings accounts- this being the account that the net profit/loss value to pull across to the Balance Sheet. Recording a transaction to that account can give the impression of incorrect net profit/loss thus it is not an account you can record to. All other accounts should be able to be recorded to. Although, linked accounts such as the Retained Earnings account we would recommend speaking with your accounting advisor about the implications of that action.

Kind regards,
Steven

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