In this article, we will teach you how to create and configure a Limited Recourse Borrowing Arrangement loan account. We will take you through two steps;
Setting up a Loan Account
Navigate to Fund Level > Investments > Bank Account
- Enter Code (Enter a unique code)
- Enter Display Name (Enter a description for the loan account)
- Full Account Name (Enter or confirm the account name)
- Enter BSB and Account Number (this can be left blank if not available)
- Search Linked To Holding Account Id field, and select the property account linked to the LRBA (this is for asset allocation reporting purposes)
- Select the Asset Classification tab
- Change the GL Classification to 'Limited Recourse Borrowing Arrangement'
- Change the Tax Return Classification to 'Borrowings-LRBA'
- Select Activate
Configuring LRBA Account to a Property Account
Navigate to Fund Level > Investments > Browse Holding Accounts.
- Select the Property Holding Account by clicking the property with the LRBA
- Select Edit
- Tick Enable Editing of Reporting Categories
- Ensure Tax Return Classification is correct
'LRBA - Australian residential real property' for residential properties or 'LRBA-Australian non-residential real property' for commercial properties.
- Click Save
Learn more about Depreciation Schedules by referring to Overview of Depreciation