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Profit and loss account / Income statement (D schedule) |
Select from the following headings:
Background | Developing the schedule | Completing the Schedule | Standard Sub-Schedules | Carry Forward | Related Errors
The D schedule is the starting point for preparation of a tax computation in the software and provides the basis of the profit before tax. It forms part of the skeleton present in every computation and should closely follow the format of the statutory profit and loss account in the published accounts, providing the basis of other analyses of allowable and disallowable income.
A whole range of supporting schedules may be developed or linked from the 'D' schedule, listed and described below.
For a computation set as IFRS, the profit and loss account is superseded by the Income statement (D). This reflects the layout in a set of IFRS financial statements.
If the accounting standard is changed back to UK GAAP, the schedule is automatically updated to reflect this.
For FY2001 and subsequent period files, there is no automatic link from the corresponding Depreciation and Profit on disposal of fixed assets data entry cells to the reconciliation section of the Fixed assets and Disposals schedules respectively. Instead, if depreciation or profit on disposal of fixed assets is a separate caption within the company's profit and loss account, the user is required to link the amounts through to those schedules using the Develop menu.
Sign convention
The schedule follows the debit/(credit) sign convention i.e. turnover should be entered as a negative figure. The software will give an error if the turnover is entered with the wrong sign. The turnover figure will be posted to the P schedule and reported on the CT return. The captions for profit or loss will flex automatically depending on the rows.
Rows
Additional rows may be inserted as required. Rows and subtotals which are not used will automatically be hidden.
Changing captions
The various captions (e.g. administrative expenses) may be altered as required by overtyping the default narrative. On carry forward, any captions which have been altered will be changed on the following period's 'D' schedule. The captions against the various totals will flex to show either a profit or a loss depending on the sign of the relevant result.
Profit before tax
This schedule allows the P/L account for a long period of account to be presented in the computation. Accordingly, it does not link to the profit before tax figure on the A schedule and the user will need to reconcile these figures manually, perhaps using the space at the foot of the D schedule itself.
Movement on reserves
The lower section of the screen covers the movement on the P/L reserves account; this does not need to be completed although the user may wish to reconcile the movement on such an account, particularly where a prior year adjustment has been made. It is up to the user to include such adjustments in the computations.
The File, Print, Options option allows a statement of the movement in retained profit in the year at the bottom of the 'D' schedule to be suppressed or displayed (see also Print section).
Note: This section does not display if the computation is set as IFRS.
Extraordinary items
Where there are extraordinary items in the P/L account, these should be entered onto this schedule. The software will include the gross extraordinary items as taxable profit/loss unless adjusted for by the user within a supporting expense analysis.
Note: This section is not relevant and does not display if the computation is set to IFRS.
Directors? remuneration
The Directors? remuneration schedule can be developed from this sheet and used to record details of directors? names and remuneration to reconcile to the accounts.
The figures entered onto this schedule will be carried forward to the Profit and loss account of the subsequent computation where they will be displayed as prior year totals.
© 2009 Thomson Reuters.