Hire Purchase
There is a good template which sets out all of the workings to calculate the capital and interest on a hire purchase agreement which is covered in the Silverfin help article here. However there are some complications, especially when splitting HP within and beyond one year for companies. We would suggest you follow the below steps to achieve the best outcome:
- Obtain the basic details on the hire purchase agreement such as term, instalment dates and amounts, etc.
- Enter these into the nominal code reconciliation Hire Purchase (which equates to the <1 year liability for companies) in Asset 1 details at the bottom of the page and repeat for all agreements. Make sure this reconciliation is set to use the Hire Purchase template (from the Edit button in the reconciliation). This will give you the amount owed balances (split <1 year and >1 Year for companies) and interest costs.
- If appropriate, use this information, to enter adjustment/journal entries to correct the hire purchase interest and liability (again <1 year and >1 year for companies)
- On the Summary of Hire Purchase summary reconciliation, use the # symbol to match the reconciliation to the hire purchase nominal code (or both codes if <1 year and >1 year). The balance here matches the data from the above nominal code reconciliation, so if your adjustments are correct, the balance here should be equal and the summary reconciliation will show green/completed.
- On the nominal code reconciliation Hire Purchase, if you are splitting >1 and <1 year, you may need to use the drop down box marked "AMOUNT RECONCILED TO" to select "Due within 1 Year", and again the amount should match and the reconciliation should turn green. Otherwise leave the box as "Total" and again this should complete the reconciliation.
We have now reconciled the total and, if relevant, the <1 year amount owed. For companies for completeness you can go into the nominal code reconciliation "Hire Purchase >1 Year", change the template (use the Edit button) to Standard Template and then insert the relevant balance from the Summary of Hire Purchase into the reconciliation as below, which will then complete the reconciliation. However, this step may be superfluous if there is only one HP agreement (as we have agreed total and <1 year) and you may choose to unstar the >1 year nominal code reconciliation. 
- Do not use the Hire Purchase summary reconciliation (the one without the nominal code next to it) if it appears.
We have now reconciled the total and, if relevant, the <1 year amount owed. For companies for completeness you can go into the nominal code reconciliation "Hire Purchase >1 Year", change the template (use the Edit button) to Standard Template and then insert the relevant balance from the Summary of Hire Purchase into the reconciliation as below, which will then complete the reconciliation. However, this step may be superfluous if there is only one HP agreement (as we have agreed total and <1 year) and you may choose to unstar the >1 year nominal code reconciliation. 