FINANCE
Hear it from the experts …
Be careful when issuing company shares
I have seen small companies with a share capital of £ 40,000 upwards, which can create a debt owed to the company for unpaid shares, and effectively removes virtually all the benefits of limited liability.
Example: With a share capital of £ 100, if the company goes into liquidation, the shareholders can lose the value of their shares. This means they might have to pay £ 100 personally to the creditors. With share capital of £ 40,000, the risk becomes £ 40,000!
In order to cancel shares issued in error, the Directors must:
1. Draft a Special Resolution cancelling the shares which must be approved by the shareholders
2. Draw up a statement of solvency confirming that the company can pay its debts and will be able to do so for the following 12 months
3. Confirm that the solvency statement was made not more than 15 days before the resolution was passed – and provided to the shareholders.
4. Complete a form SH19 and send to Companies House – with the other three documents.
Then, the shares will be cancelled and monies can be repaid to the appropriate shareholders – or the value of the cancelled shares can be used to clear / reduce the amounts owed for unpaid share capital – which brings the share capital down to a more practical, and safer, level.
Peter Bromiley ACA AMS Accountancy Ltd, 01793 818400 www. ams-accountancy. co. uk / about-us / ask-ams
WATERSHEDS SECURE MAJOR DEAL FOR WAYFINDING COMPANY
Swindon-based corporate finance specialists, Watersheds, has successfully completed the sale of a leading UK wayfinding company to multi-award winning international architecture and design group, Benoy.
Ask AMS Advice for small businesses AMS Accountancy Ltd. 01793 818400
Should we set up our family business as a Partnership?
There are many reasons for not choosing a Partnership in your position, for instance:
They are less tax efficient than Limited Companies Partners must pay Class 4 National Insurance All Partners are responsible for all debts Partnerships can result in disagreements if there is no legal agreement.( A Limited Liability Partnership could be better).
Here are some advantages to a Partnership over a Limited Company structure:
Income can be apportioned more flexibly between Partners( but please get a legal agreement) The rules are less rigid than for Company dividends. Partners’ cars can be more easily used to save tax.
Peter Bromiley ACA
www. ask-ams. co. uk
@ AMSAccountancy www. ams-accountancy. co. uk
Pictured from left to right: Wendy Lam and Sue Green
Watersheds represented Holmes Wood whose award winning portfolio of work includes designing wayfinding strategies and graphic design solutions for the Tate Modern, The National Gallery and The Natural History Museum. Alexandra Wood of Holmes Wood, said:“ We are delighted to have worked with Watersheds. Finding the right buyer was important to us because we have built this business and its reputation since we established it in 2000. It was essential the buyer understood the vision we have for the business going forward, and shared our culture and ethos. Watersheds understood this, working hard to meet our needs.“ Selling our business was a big decision and Watersheds were able to advise and support us throughout the process.”
The acquisition means that London headquartered Benoy Group, the parent company of multi-award winning international architecture and design studio Benoy, can now add wayfinding expertise to its portfolio of services, realising its vision to become a multi-boutique design leader, and provide the very best in cutting edge design.
Wendy Lam, Partner at Watersheds, said:“ This deal was all about finding the right buyers for our clients; somebody who understood the business and appreciated the potential it has to grow and, more importantly, an organisation who had a cultural fit.
“ It was clear from the initial meeting that Holmes Wood and Benoy had a lot in common, and that the services provided were complementary. We are pleased to have initiated a deal which has led to the joining together of two highly regarded British design brands, enabling Holmes Wood to retain its individuality while integrating Benoy’ s design philosophy, operational strengths and global reach.” Expert legal advice was provided by regional law firm
Thrings. Thrings corporate partner Simon Hore, senior
corporate partner John Davies and trainee solicitor, David Geller advised Holmes Wood on the corporate aspects of the deal.
Simon said:“ Holmes Wood’ s world-class wayfinding and signage skills make the perfect addition to the Benoy Group’ s design business. Thrings is delighted to have advised Alex and Lucy on all legal aspects of the transaction and we are glad to have met the tight timescales involved. We wish Holmes Wood continued success in the future as part of the Benoy Group.”
For more information contact Sue Green on 01793 719788 or email sue. green @ watersheds. ltd. uk
www. watersheds. ltd. uk
16 THE BUSINESS EXCHANGE 2017