Context: The 'Inter-Entity Loan Matrix' is often used in practice to view, at a glance, what the loan balances are as per each entity's accounting file. This matrix can therefore highlight if there are any discrepancies and alert the accountant to investigate further.
Please refer to the Glossary for definitions of key terms used in this article.
Creating the binder
To use the 'Inter-Entity Loan Matrix' worksheet, create a new binder selecting 'Accounts & Tax' - see the support article: How to create a binder, for more information.
Adding the 'Inter-Entity Loan Matrix' worksheet
Add the 'Inter-Entity Loan Matrix' as you would any other record template (you can search for the matrix in the search bar).
For more information regarding how to add a record template, see the support article: How to link various records to a binder.
Setting up the 'Inter-Entity Loan Matrix' worksheet
Once you have added the 'Inter-Entity Loan Matrix' worksheet against an account, click on it to open the slideout. The slideout will initially show the following:
Details of the account against which it was added
Instructions
Empty matrix with only the current client and binder
Click on + Add Client.
The following pop-up will appear, where you will need to select the relevant client and binder. Select accordingly and click Submit.
Once you have linked that binder, it will appear in the loan matrix.
In the loan matrix, click on the + in the light grey boxes to link the accounts between the two binders.
Once happy, click Submit.
Using the 'Inter-Entity Loan Matrix' worksheet
Once the accounts have been linked, the balances as per each binder will be displayed in the loan matrix. If the balances agree, both cells will appear in green. In this case, the accounts against which the loan matrix have been added to will show as reconciled.
Note: When an account is linked in the matrix, whether it is the current binder or an external binder, the loan matrix will be added as a record against that account.
If the balances do not agree however, they will be displayed in red.
Hint: The matrix will display a black border around the cell which contains the balance of the account you are currently in. For example, as below, the user has opened the loan matrix from account '626 Loan - Johnson Family Trust (2024)' which has a debit balance of $39,100. This balance is reflected in the matrix under the 'Johnson & Co Pty Ltd 2024 Accounts and Tax' binder (the current binder), in the black-bordered cell.
Adding multiple loan accounts into a cell
You can add multiple loan accounts into a cell where there are multiple loans to be reconciled between two entities.
Where there are multiple loan accounts linked to one related entity, the loan matrix slideout will display a summary which breaks down the accounts that are linked. This summary will only be shown if the loan matrix record has been opened from any of those multiple accounts.
Manually create entities in the 'Inter-Entity Loan Matrix' worksheet
You are also able to create entities manually in a loan matrix without needing to link to a binder. This is especially useful when these entities are not clients of the firm.
Click on the new + Enter Manually button.
Enter the entity's name and click Submit.
Then click on any of the columns to manually input the loan amounts.
