Each head of an enterprise of any legal form is faced with a periodic shortage of funds. The production process is characterized by a temporary lack of free financial resources, the replenishment of which is carried out at the expense of borrowed funds. Accordingly, accounting for loans is one of the most important aspects of accounting.
As in every area, this area is also not without certain nuances. It is more difficult for an accountant to reflect the moments of charging and writing off fines, singing and forfeits. As you know, accounting for loans and borrowings includes the calculation of interest on the use of borrowed capital. Often, commercial banks act as lenders, but they also identify other ways: for example, granting deferred payment by counterparties or a commercial loan, share contributions to the company's equity .
Accounting for borrowed funds is based on a bilateral agreement or contract. This document not only indicates the lender’s consent to provide the indicated amount of cash, but also includes the rationale and terms of the contract. A prerequisite that must be present in the agreement is the term and scheme of return, form of collateral, interest rate, etc.
In order to get the desired amount, you should provide the bank with financial documentation confirming the solvency of the company. The employee of the credit institution checks the level of profitability, liquidity and other key indicators. In addition, the accounting of loans and loans is checked for existing debts, as well as the dynamics of timely repayment of loans in the past.
As a rule, lending is carried out for specific needs, that is, it has a strictly targeted nature. Therefore, it is the borrower's responsibility to strictly adhere to a previously approved estimate. Any deviation gives the bank the right to demand an immediate return of the debt. Accounting for loans and borrowings involves the reflection of the form and amount of collateral in the documentation of accounting.
Allocate such types of collateral as a guarantee, guarantee, pledge or insurance of the amount. The guarantee implies the assurance of a third party of the solvency and honesty of the client, in addition, under the contract, the guarantor is obliged to repay a part of the loan or the full amount in case of impossibility or unwillingness to repay the payment. As a rule, a guarantee is issued by banks providing written assurance of the borrower's reliability to another credit institution. A pledge represents property or other rights that are temporarily transferred to the bank as a guarantee of loan repayment. In case of impossibility of a full return, the pledged item becomes the property of a commercial bank.
Accounting for loans and borrowings can be conditionally divided into types of loans, depending on the term for short-term and long-term. The former are recorded in the settlement account for short-term loans and credits, and the latter, respectively, in the accounts of “Estimates for long-term ...”. Different accounts allow you to distinguish between the purposes for which the funds received are used. So, the account for short-term loans reflects the amount of borrowed capital employed in working capital. And long-term lending is usually used to implement large and promising projects, for example, the construction of a housing complex.
As you know, lending institutions issue loans in foreign and national currency. However, accounting for all amounts is carried out only in the currency of our country, therefore, funds are exchanged at the current rate, and the resulting difference is credited to the account “Other income and expenses”.