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Third leaf · folios fourteen to eighteen

Shared overheads

One cost line, one basis, one division, one note per entity, once a month. The arithmetic is on the sheet at folio four.

Leaf opens at
Folio fourteen — continued from folio thirteen
Register concerned
Recharge ledger, kept with the document file
Worked sheet
Apportionment sheet at folio four

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Folio fifteenThe test a cost has to pass to sit here

A cost belongs in the holder’s ledger if it cannot be bought in pieces, or if buying it in pieces would cost more in administration than the division saves. Everything else is bought by the entity that needs it, in its own name, and never appears here at all.

Costs that pass the test: the registered office and the handling of post addressed to it; the maintenance of the registers described at folio six, including the stationery a bound register actually needs; the bookkeeping system the group’s ledgers are kept in, where one licence covers the group; a policy taken out in the name of the group, where one is taken out; and the professional engagement of whoever prepares the group’s statutory records, where that engagement is made by the holder rather than by an entity.

Costs that fail it, and are therefore not here: anything bought for a single job, anything specific to one entity’s trade, and anything an entity can order on its own account without asking. A shared cost that only one entity uses stops being a shared cost; the sheet at folio four shows that case plainly, because three of the four shares come out at nil.

A cost is never split because splitting looks fair. It is split because the thing bought is genuinely in common use and the division can be arithmetic rather than judgement.

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Folio sixteenThe bases, and the book each figure is read from

A basis is useless unless every reader can get the same figure from the same place. Each basis below names the record the figure is read from and the day it is read on. If two bases would do, the one with the shorter path to a written record is used.

Head count
The number of people engaged by each entity as at the last day of the month, read from that entity’s own record and confirmed by it in writing. Used for costs that scale with people.
Floor area, in square metres
Read from the plan annexed to the document under which each entity occupies space. Used for costs attaching to premises.
Boxes of filing held
Counted at the registered office on the last working day of the month and written on the count sheet. Used for storage and record-keeping costs.
Equal parts
Used only where the thing bought is indivisible and used alike — and then recorded as a decision in the minute book, with the date, so that the choice is visible rather than assumed.
ONE COST LINE, DIVIDED ON ONE BASIS AB CD 9 ÷ 316 ÷ 31 13 ÷ 313 ÷ 31 WIDTHS DRAWN TO THE ILLUSTRATIVE FIGURES
The band is the cost; the warp lines are the division. Change the figures on the sheet at folio four and the widths change with them.

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Folio seventeenThe month end, in order

  1. On the last working day of the month the basis figures are read from the records named at folio sixteen and written on the count sheet, with the date and the source against each.
  2. The centrally carried cost lines for that month are listed from the holder’s ledger. A cost not yet invoiced to the holder waits for the month in which it is.
  3. Each line is divided by the method at folio four. The working is kept, not just the answer, so that a question about a share can be answered without doing the sum again.
  4. One recharge note is drawn for each entity, listing every line, the basis used, the fraction applied and the resulting share, and totalling to that entity’s part of the month.
  5. The note is entered in the recharge ledger with its date and folio, and sent to the entity on the same day.
  6. The entity’s acknowledgement is filed against that folio. A query is entered in the correspondence register and answered from the kept working.

A change part way through a month is not apportioned by days. The figure as at the last day of the month governs the whole of that month, unless a signed document says otherwise, in which case the document is filed and cited on the note. This is a deliberate coarseness: daily apportionment would cost more to administer than the accuracy is worth.

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Folio eighteenWhat stays with the holder and is never divided

Some costs exist only because the holder exists, and they are not the entities’ business. The holder’s own filings about itself. The maintenance of the holder’s own register of members, register of directors and register of people with significant control. The cost of keeping this register legible, including this site. These stay in the holder’s ledger and are not recharged to anyone.

Nor is anything added to a recharge. A note carries the cost as invoiced to the holder, divided; there is no handling figure, no margin and no rounding in the holder’s favour. Where rounding to the penny leaves a difference, the difference is carried to the largest share and said so on the note, exactly as the sheet at folio four says it.

The ledger lines, the count sheets and the recharge notes are kept together, by month, so that a reader with one note can reach the cost it came from and the figures it was divided on. How long each is kept is at folio twenty-three.

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