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HMRC internal manual

Enquiry Manual

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HM Revenue & Customs
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Examining Accounts: Example of Cash-Flow Tests

‘Minus Cash’ - Weeks 1 and 2

The taxpayer might claim that the overall deficit is only £20 which shows that it is the carry-over figure which is wrong. This is not the case because there is still an overall deficiency of £20. Is the carry forward figure wrong at the end of Week 2 as well(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

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Using the taxpayer’s suggested carry forward of £60 and assuming all Friday’s takings were available for banking and no cash was carried forward to Saturday, the result is

    £
     
Cash available to Friday (£60 + £905)   965
Cash used to Friday £800 + £168   (968)
     
Deficiency   (3)
     
- A problem then arises for Saturday £  
Takings 364  
Own drawings (180)  
Cash forward (200)  
     
Deficiency (16)  

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)