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The Reconciled via hire purchase or bank loan template is a lightweight, link-through account template for the nominal account holding the hire purchase or bank loan balance due after more than one year. Rather than taking its own data entry, it identifies which within-one-year Hire purchase or Bank loans account the long-term balance relates to, and reconciles this account against the "due after one year" figure already calculated on that linked account's Hire purchase (Account template) or Bank loans (Account template).

Table of contents 

When should I use this template?

Apply it to the nominal account holding the hire purchase or bank loan balance due after more than one year, once the corresponding within-one-year account is already using the Hire purchase (Account template) or Bank loans (Account template). Do not apply it to the within-one-year account itself. Silverfin recognises when it has been applied to the wrong side of the split and warns you to select a different template.

Before you start

  • Make sure the related within-one-year hire purchase or bank loan account already has the Hire purchase (Account template) or Bank loans (Account template) applied, with its amortisation schedule complete. This template reads the "due after one year" figure from that schedule, so it has nothing to reconcile against until that is in place.
  • Confirm which long-term nominal account is meant to hold the corresponding due-after-one-year balance for that agreement.

Background

Hire purchase and bank loan balances are shown on the balance sheet split between the amount due within one year and the amount due after more than one year. This template exists so that split does not have to be worked out twice: the long-term account simply reconciles to the "due after one year" figure already calculated on the linked within-one-year account, rather than requiring a separate schedule.

Steps

  1. Account category check. When the template is applied, it checks whether the account sits on a recognised hire purchase or bank loan nominal code for balances due after more than one year. If it does not, a warning explains that the template should only be used on this type of account, and the account is flagged as unreconciled until either a different template is selected or the correct account is used.
  2. Select the account(s) to reconcile against. Above the table, a picker lets you choose which within-one-year Hire purchase or Bank loans account(s) this balance relates to. It defaults automatically to the matching account where Silverfin can identify one from the account numbering, but you can change the selection if the client's chart of accounts does not follow that pattern.
  3. Review the linked accounts and amounts. Each account you have selected is listed with a link back to it, alongside the "due after one year" amount already calculated on its Hire purchase or Bank loans account template. This is the figure Silverfin expects to also be posted to the long-term account you are reconciling.
  4. Explain any difference, if needed. If the total of the linked "due after one year" amounts does not match the account balance, extra rows appear so you can enter a description and a value that accounts for the difference, for example a new loan posted directly to the long-term account before its within-one-year schedule was set up. These rows only appear once there is an actual difference to explain.
  5. Check the reconciliation. The account balance, the total of the linked amounts, and any explained difference are shown together, with an unreconciled indicator that clears once they agree.
  6. Watch for the account template mismatch warning. If one of the linked within-one-year accounts is not actually using the matching Hire purchase or Bank loans account template, a warning lists which accounts to check. Resolve this by confirming the account template assigned to that linked account.

What flows through to the rest of the accounts/workflow?

Nothing new is calculated here, as the template does not produce its own figures or feed a note. It confirms that the due-after-one-year figure already produced by the Hire purchase (Account template) or Bank loans (Account template) agrees with what is posted to the long-term liability account, so the balance sheet's current and non-current split for hire purchase and bank loan balances is evidenced.

What rolls forward next year?

The account(s) you have selected to reconcile against carry forward automatically, since nothing resets that selection at the start of a new period. You should not need to reselect it unless the client's chart of accounts changes. Any explanation-of-difference rows you have entered also carry forward as they stand, so check them each year: if the reason for a difference no longer applies, remove or update the row rather than leaving it in place, otherwise it will continue to be included in the reconciliation.

Where the data comes from

The "due after one year" figure comes entirely from the linked within-one-year account's Hire purchase (Account template) or Bank loans (Account template), as this template performs no amortisation calculation of its own. The only things entered directly on this template are which account(s) to link to and, where needed, an explanation of any difference.

Frequently asked questions

Why does it say this account template should only be used on accounts due after more than one year?

The account you have applied it to does not sit on a nominal code Silverfin recognises as a hire purchase or bank loan balance due after more than one year. Check the account is the correct long-term account, or choose a different account template if it is not.

Why is nothing showing in the table?

This template does not show a reconciliation table until it recognises the account as a due-after-one-year hire purchase or bank loan account. If the account category is right but the linked within-one-year account does not yet have an amortisation schedule, there will be nothing to reconcile against.

Why are there rows asking me to explain a difference?

These only appear when the total of the linked accounts' "due after one year" amounts does not match the balance on this account. Use them to describe and quantify the reason, rather than leaving the account unreconciled.

Why is there a warning listing certain accounts?

It means one or more of the accounts you have selected to reconcile against is not actually using the corresponding Hire purchase or Bank loans account template, so the "due after one year" figure it is showing may not be reliable. Check the account template applied to the accounts listed.

Can I select more than one linked account?

Yes. Where a long-term balance relates to more than one within-one-year account, select all of them. The template totals the "due after one year" amounts across every account selected.

For accounting periods ending on or before 31 October 2023, this template instead applied to the within-one-year account and worked differently. This is not relevant to how the template behaves for current periods.