G2 Other Current Assets

Based on the information provided by the client in their annual questionnaire, use this workpaper to confirm the closing balances of current assets.

Trading Stock

As from the 2003 income year, a taxpayer with turnover (in the 12 months leading up to the taxpayer's balance date) of less than $1.3 million need not value trading stock at year end, if it can be reasonably estimated that the taxpayer has less than $10,000 worth of trading stock. Section EB 23 Income Tax Act 2007. In these circumstances IRD advise that closing stock should be valued at the same level as opening stock.

  1. Enter the account code for stock on hand.
  2. From the client questionnaire, enter the value of stock on hand as at balance date.
  3. Confirm correct valuation method used.
  4. Determine the reason behind variances.
  5. Create manual journal to update general ledger if required.

Work in Progress

Work in progress includes goods, property or services in the process of production but not yet completed.

  1. Enter the account code for work in progress.
  2. From the client questionnaire, enter the value of work in progress as at balance date.
  3. Confirm correct valuation method used.
  4. Determine the reason behind variances.
  5. Create journal to update general ledger, if required.

Cash on hand

Cash on hand can be used to describe the cash amounts held on the client’s premises as at balance date. Often referred to as cash on hand, petty cash or till/cash floats.

  1. Enter the account code for cash on hand.
  2. From the client questionnaire, enter the value of cash on hand at balance date.
  3. Determine the reason behind variances.
  4. Create journal to update general ledger, if required.

Prepayments

Are payments in advance for goods or services that will be consumed by the client in the next reporting period.

  1. Enter the account code for prepayments.
  2. From client questionnaire, enter amount of prepayments at balance date.
  3. Determine the reason behind variances.
  4. Create journal to update general ledger, if required.

Goodwill

Goodwill refers to those unidentifiable benefits that accrue to an entity by virtue of circumstances such as a favourable location, good customers or supplies, and motivated employees. Generally only goodwill that has been purchased can be recognised on the balance sheet.

  1. Enter the account code for goodwill.
  2. From client questionnaire, enter amount of prepayments at balance date.
  3. Determine the reason behind variances.
  4. Create journal to update general ledger, if required.