is this fraud?

silentkiller

My parents own a business with 2 other people and all act as Directors recycling paper and plastic. I work for them as well in their admin department with a friend. We sold some waste items to someone but they paid in cash. On our accounts system Sage there is an invoice and now we have to pay off the invoice off the system. Both myself and my friend suggested that one of the directors write a cheque out of their personal account and do it that way. Apparently this is fraud :S Which I think I just about understand. but then the same director who said it was fraud said that none of the directors are allowed to put their own money into the business account as this is fraud? and he asked us to scrap the invoice and forget it existed - but surely this is fraud as well?

Jowo_2

Why can't you pay the cash into the business bank account for that transaction, then record the invoice as paid?

Hammyman

Seconded. I just paid £100 in cash into mine yesterday. Its really simple and requires you to walk into the bank with the business account cash deposit card.

JCS1

Is there a way in Sage to debit the bank account and credit the debtor?

Or even debit petty cash and credit the debtor?

if that fails, raise a credit note to clear the debtor and process the cash as a cash sale.

silentkiller

I don't really know the ins and outs but one of the directors said it was fraud but I don't believe it is. Sometimes I wonder where they get their bloody facts from lol.

olias

So they run their 'business', by recieving cash in return for goods, but they 'don't want it putting through the books' and want you to destroy company accounts documentation and 'forget about it'............. hmmmn.

Olias

silentkiller

Which is exactly what I said Olias! Surely it would be worse to destroy records than to just pay in 7 quid! silly people.

cla666

Hey,

you really should be paying this money into the business bank account.

Im an accountant and use Sage. Your only option and I COMPLETELY do not recommend this, is to delete the invoice, and you can do this. Bet you can bet when the auditors come in they will spot this in seconds. Its a very dodgy accounting practice. And the accounts department will get the blame.

If I were you I would tell the directors there is no way to get rid of the invoice without depositing the cash. What has happened with the cash? Is it sitting in petty cash? If it is you could always just record the invoice as being paid into petty cash?

p00hsticks

silentkiller wrote: »

Both myself and my friend suggested that one of the directors write a cheque out of their personal account and do it that way. Apparently this is fraud :

I think the "fraudulent" bit is probably where one of the directors appears to have simply pocketed the cash as their own in the first place. If instead you consider the cash as belonging to the company (whcih is does), then I would have thouht it should be simple enough for the person who has been 'minding it' up to now to either add it into the petty cash box or pay it into the company bank account.

cavework

It isn't fraud if they pay it back in . Cash perhaps?
Seems that someone 'thought' this could be a cash in hand payment until the invoice was submitted through the company and left a trail

silentkiller

well according to my director, cash can't be paid into Alliance and Leicester at their desks (for a business account anyway)... am I right in thinking that since it is part of Santander, he could pay it in with cash via the old Abbey branches?