Shareholder Funds and Director's Current Account

[bobtongs]

I'm currently filing a CT1 for my small business (limited company). I'm in the process of striking off the company so the only liabilities are Director's Current Account, money owed to myself. This is greater than the assets of the company. This listed as a current liability in the balance sheet.

For calculating Shareholder's Funds for the CT1 form, should I include the Director's Current Account? This would mean a negative value for Shareholder's Funds, which technically would indicate the company is insolvent.

Is this what Revenue would expect to see in this situation? Or does it not matter too much as the company has already ceased trading?

Thanks in advance,

 

[Brendan Burgess]

No. Shareholders' funds are the accumulated profits or losses of the company.

It has nothing to do with directors' loans.

Brendan

 

[cremeegg]

Que ?

No. Shareholders' funds are the accumulated profits or losses of the company.

Yes. If the accumulated results are losses they must have been financed from somewhere. A Directors loan to the company in this case.

It has nothing to do with directors' loans.

Brendan

If the directors loan is omitted from the accounts, presumably written off, that changes the accumulated loss. The loan and the loss are very much connected. The loan financed the loss.

Whether it is advisable for the OP to write back the loan in the accounts of the company or not (given that it cannot be repaid) I cannot comment.

 

[bobtongs]

If the directors loan is omitted from the accounts, presumably written off, that changes the accumulated loss.

Given that the money owed will not be repaid by the company, should the Shareholder's Funds then just reflect the accumulated profits, which is Cash in hand? There are no other liabilities.