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| Rose24 |
Posted - 19 July 2010 : 14:56:22
Hello Everybody
I'm so glad I have found this forum. I am about to file for bankruptcy. I had a shop, and I ceased trading last week. I have already taken professional advice, but little questions keep popping into my mind. I was a sole trader and I have very little in the way of assets (ie, I don't own a home or anything like that), just the remaining stock and shop fittings.
What I am mainly wondering about is how deeply the OR delves into your accounts etc? I asked the IP if the OR would want a full set of up-to-date accounts and he said no, they probably wouldn't need to see my books. A friend of mine was bankrupted by HM Rev last year and they never asked to see his accounts. But when filling in the statement of affairs it states that they will require my books and accounts. So I just wanted to ask what other people's experience of this has been? My accounts are not made up-to-date for this year yet, and I'm not sure whether I need to get my accountant to do that first before I file.
Thanks. |
| 7 L A T E S T R E P L I E S (Newest First) |
| Rose24 |
Posted - 19 July 2010 : 18:22:23
quote:
Originally posted by debtinfo
all depends on the circumstances, The OR is looking at when it was reasonable or not to stop and that the crown has been treated fairly. Most business's make a loss in the first year or to so the the OR allows a little latitude (blue sky thinging they call it) where there was a prospect of turning it around in the future. One of the reasons they changed the rules or bankruptcy a few years ago to make it less harsh was to encourage people to have a go at business without the most severe consequences if it all goes wrong
Thanks Debtinfo, I was starting to panic there! I ceased trading precisely because I thought it was unreasonable to attempt to carry on, but it was a fairly new business, and struggled to get off the ground because the recession hit soon after I opened, so it did make a loss. I was tied into a lease, so felt I had to carry on and try and make it work. |
| debtinfo |
Posted - 19 July 2010 : 18:02:39
all depends on the circumstances, The OR is looking at when it was reasonable or not to stop and that the crown has been treated fairly. Most business's make a loss in the first year or to so the the OR allows a little latitude (blue sky thinging they call it) where there was a prospect of turning it around in the future. One of the reasons they changed the rules or bankruptcy a few years ago to make it less harsh was to encourage people to have a go at business without the most severe consequences if it all goes wrong |
| Rose24 |
Posted - 19 July 2010 : 17:50:18
quote:
Originally posted by debtinfo
Yep, it wont be a problem, the OR can take all of the invoices and receipts and reconstruct them if it really matters, Mostly what they start with is just the yearly accounts to see how the business was trading in the past. The records are evidence in the bankruptcy and as such you have a duty to protect them and offer them up if asked to do so.
Thanks guys. If the business made a loss in previous years (which it did) will that go against me? |
| debtinfo |
Posted - 19 July 2010 : 17:41:33
Yep, it wont be a problem, the OR can take all of the invoices and receipts and reconstruct them if it really matters, Mostly what they start with is just the yearly accounts to see how the business was trading in the past. The records are evidence in the bankruptcy and as such you have a duty to protect them and offer them up if asked to do so. |
| Bridgewood |
Posted - 19 July 2010 : 16:29:48
Hi Rose24
I would go ahead and make the appointment to file your bankruptcy petition and get the books up to date as much as you can in the meantime.
It will probably be a couple of weeks at least before you get to the OR's office, but I wouldn't worry too much if the books are only a couple of weeks out of date by then.
The OR is concerned with what records you kept and how accurate they are, and whether you were able to tell what your financial position was at any one time
Obviously it would be better if your records were fully up to date, but he won't worry if they're only a couple of weeks out.
Bridgewood specialise in helping people deal with their debts and make the most of their financial situation - providing free, no obligation debt advice.
We can also setup a complete range of solutions including debt management plans, IVA and bankruptcy support. |
| Rose24 |
Posted - 19 July 2010 : 16:07:49
quote:
Originally posted by Bridgewood
Hi Rose 24
The OR will want to see the last set of accounts prepared, and will want the books and records for the last few years trading (usually up to 6 years but don't worry if yours don't go that far back)
Don't go to the expense of getting up to date accounts done, just make sure that your books are written up to the date you ceased trading - detailing sales, purchases etc.
The OR will want copy cash book, bank statements, cheque book and paying in book stubs, purchase invoices, sales invoices (if applicable), VAT records and copy returns - he'll also want to see any finance and rental agreements.
Hope that helps
Good luck
Bridgewood specialise in helping people deal with their debts and make the most of their financial situation - providing free, no obligation debt advice.
We can also setup a complete range of solutions including debt management plans, IVA and bankruptcy support.
Hi Bridgewood
Many thanks for your reply. My books aren't up-to-date yet. Does the OR give you time to get everything together? Do you think I can I go ahead and file the petition and then work with my bookkeeper to pull everything together over the next couple of weeks or so?
Thanks. |
| Bridgewood |
Posted - 19 July 2010 : 15:55:13
Hi Rose 24
The OR will want to see the last set of accounts prepared, and will want the books and records for the last few years trading (usually up to 6 years but don't worry if yours don't go that far back)
Don't go to the expense of getting up to date accounts done, just make sure that your books are written up to the date you ceased trading - detailing sales, purchases etc.
The OR will want copy cash book, bank statements, cheque book and paying in book stubs, purchase invoices, sales invoices (if applicable), VAT records and copy returns - he'll also want to see any finance and rental agreements.
Hope that helps
Good luck
Bridgewood specialise in helping people deal with their debts and make the most of their financial situation - providing free, no obligation debt advice.
We can also setup a complete range of solutions including debt management plans, IVA and bankruptcy support. |
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