Investment Clubs Manual058

Investment Clubs Manual058 - 51 October 2008 Closing off...

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Unformatted text preview: 51 October 2008 Closing off the Cash Account It is recommended that the Cash Account should be closed off every month. If you want to have everything tidied up for the club's monthly meetlng, make sure that you allow plenty of time before the meeting to receive statements from your bank and stockbroker and reconcile your records. The procedure for closing off Is as follows: Calculate the balance, as shown on the previous page. If receipts exceed payments, this balance should be entered in the Sundry Payments column of the Cash Account and also in the Total Payments column. The entry wlll be described as Balance in Hand. If payments exceed receipts, the balance will be entered under Sundry Receipts and under Total Banked. This time the entry will be described as Due to Bank. Once this balance has been added to the appropriate side of the Cash Account. the total banked on the receipts side will equal the total cheques out on the payments slde.The Cash Account can then be ruled off. The accepted way of doing this is to rule one line above the total figures and two lines underneath. The first entry made in the next month's Cash Account is the closing balance for the previous month. You will start off by bringing down either a credit balance on the receipts side or an overdraft at the bank on the payments side. Thereafter the procedure is the same as for the previous month. Note: The balance at one man th’s end is always carried down to the opposite side at the beginning of the next month. if the club has funds in hand the balance figure will have been entered as a Sundry Payment but must be brought down on the receipts side of the next month. Some clubs have accounts with their stockbrokers, whereby cash balances are held by the stockbroker and interest is paid to the club. The club should receive statements in the same way as from their bank. To avoid confusion, it is recommended that details of this account are recorded in a separate Cash Account. Entries of cash balances held by the club’s broker to the Cash Account are dealt with in similar fashion to those for the bank account. ProShare Investment Club THE MANUAL ...
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