Estate Accounting

The accounts of a landed estate are based upon the cash transactions over the period under consideration. The cash trans-
actions may be used as the basis for the preparation of a revenue and expenditure account by adding to the cash receipts and
payments the balances receivable or payable at the close of the period, and deducting the balances receivable or payable at
the beginning of the period. It will be often of inestimable advantage to keep a columnar form of cash book to admit of the
analysis of the cash transactions as they take place; if a system of ledger accounts were in use, the analytical cash book would
be useful in localising any errors thrown up by the trial balance at the close of the accounts. The accounts of the home farm
should be kept quite distinct from the general estate accounts and the profit or loss on the working of the home farm clearly
brought out in such accounts.

The foregoing form would give a general view of the receipts and payments up to date for the current accounting period,
but a more detailed account will be necessary to lay before the principal after the period is closed. An account of charge and
discharge will frequently be found the most serviceable, as it shows the various items of receipts and payments classified under
suitable heads with their several dates and narrations, thus giving every information concerning them. The totals of these
heads in such an account would necessarily agree with the totals of their respective columns in the above ruling of cash book.

If a complete system of ledger accounts were kept with the foregoing style of cash book then each item would be posted
to the Dr. or Cr. side of its appropriate account and the folio columns provided in the form would be utilised. A general
abstract of the accounts framed from the cash book would then be sufficient as an accounting statement for submission to the
principal, supported by the production for his examination of the ledger containing the various postings. If it were still
desired to frame the accounts in detail in the form of an account of charge and discharge, the heads to be adopted would be
those of the ledger accounts, and the statement itself would be simply an arrangement under these heads in chronological order
of all the items appearing in the ledger accounts.

The alternative method is to have a more detailed cash book and to frame the period's accounts as a cash abstract, giving
only the total of each head or sub-head of receipt and expenditure.

The total of the "Collected by Factor" column would be the sum chargeable in the factor's account of charge and dis-
charge. An alternative, and perhaps preferable, method is to charge the factor in the account with the total rents receivable,
and to discharge the "Paid Direct" items and the arrears at the close of the account. The "Paid Direct" items would be
charged up to the "Personal" heading against the principal, and the arrears would be included in the discharge as part of the
assets or floating balances at the close of the account.

The analysis can be extended indefinitely, according to the nature and extent of the particular estate.

Form 7, Report by Factor to Proprietor, with Appendices

REPORT TO THE PROPRIETOR by the Factor,

SIR,-There is appended hereto a Statement which shows the Cash Receipts and Payments during the month.

The Arrears of Rents and Feu-Duties amounted to £

At

Add: Rents and Feu-Duties falling due during month
Lands, &c., £

; Fishings, £

The balance in hands of the Factor amounted to £ consisted of —

; this balance