Post-Trial-Balance Adjustments
Accruals, prepayments, depreciation, irrecoverable debts, inventory and correcting entries.
How to study the ATT Qualification
Use Finance Act 2025 for the 2026 tax papers, complete the three foundational CBEs early, apply professional ethics throughout and concentrate option practice on the one paper you will enter.
Core concepts
Concept 1
Year-end adjustments apply accrual accounting and measurement rules to unadjusted balances.
Exam cue: Calculate the amount belonging to the reporting period.
Concept 2
Each adjustment affects profit and one or more statement-of-financial-position balances.
Exam cue: Write both sides of the correcting entry.
Concept 3
Errors require analysis of the entry made and the entry required.
Exam cue: Check the effect on profit, assets and liabilities.
Risk pitfalls and guardrails
Posting only one side of an adjustment.
Guardrail: Do not use an obsolete tax rate, assume a relief, ignore legal form, submit unsupported information or omit the relevant deadline and ethical response.
Confusing accumulated depreciation with the expense.
Guardrail: Do not use an obsolete tax rate, assume a relief, ignore legal form, submit unsupported information or omit the relevant deadline and ethical response.
Adjusting cash instead of the related receivable or payable.
Guardrail: Do not use an obsolete tax rate, assume a relief, ignore legal form, submit unsupported information or omit the relevant deadline and ethical response.
Memory anchors
Accrual
Recognise an expense incurred but not yet recorded or paid.
Prepayment
Carry forward payment relating to a future period as an asset.
Depreciation
Allocate depreciable amount systematically over useful life.
Irrecoverable debt
Remove the receivable and recognise the loss.
Correction
Reverse the wrong effect and record the right effect.
Checkpoint rule
Do the check-up only after you can summarize each concept in one sentence and identify one dangerous pitfall from memory.
Knowledge Check (after reading)
Short check-up to confirm understanding of this module.
Check-up Questions
At year end, electricity expense of £1,800 has been incurred but not invoiced. What adjustment is required?
Insurance of £2,400 was paid on 1 October for 12 months and the year ends 31 December. What prepayment is recognised?
Answer all questions to submit.
Next step personalized recommendations
Continue learning
Move forward only after this module is stable.
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