Commencement Information
I1Sch. 3 wholly in force at 6.1.1992 see ss. 1(1), 18(2) and S.I. 1991/2721, art. 2
7(1)Where it is proposed to declare a distribution during the accounting reference period of the successor company which includes the appointed day, or before any accounts are laid or delivered to the registrar of companies in respect of that period, sections 270 to 276 of the M1Companies Act 1985 (relevant accounts) shall have effect as if—U.K.
(a)such accounts as are mentioned in sub-paragraph (2) below were accounts relevant under section 270, and
(b)references in section 273 to initial accounts included references to any such accounts,
and, if any direction has been given under section 8(2) of this Act which is relevant to the making of that distribution, shall accordingly have effect subject to that direction.
(2)The accounts referred to in sub-paragraph (1)(a) and (b) above are such accounts as, on the assumptions stated in sub-paragraph (3) below, would have been prepared under Part VII of the M2Companies Act 1985 in respect of the relevant year.
(3)Those assumptions are—
(a)that the relevant year had been a financial year of the successor company;
(b)that the vesting effected by section 1 of this Act had been a vesting of all the property, rights and liabilities to which the Corporation or Board was entitled or subject immediately before the beginning of the relevant year and had been effected immediately after the beginning of that year;
(c)that the value of any asset and the amount of any liability of the Corporation or Board vested in the successor company by virtue of that section had been the value or (as the case may be) the amount assigned to that asset or liability for the purposes of the statement of accounts prepared by the Corporation or Board in respect of its financial year immediately preceding the relevant year;
(d)that any securities of the successor company issued or allotted before the declaration of the distribution had been issued or allotted before the end of the relevant year; and
(e)such other assumptions (if any) as may appear to the directors of the successor company to be necessary or expedient for the purposes of this paragraph.
(4)For the purposes of such accounts as are mentioned in sub-paragraph (2) above the amount to be included in respect of any item shall be determined as if anything done by the Corporation or Board (whether by way of acquiring, revaluing or disposing of any asset, or incurring, revaluing or discharging any liability, or by carrying any amount to any provision or reserve, or otherwise) had been done by the successor company.
Accordingly (but without prejudice to the generality of the preceding provision) the amount to be included in any reserves of the successor company as representing its accumulated realised profits shall be determined as if any profits realised and retained by the Corporation or Board had been realised and retained by the company.
(5)Any such accounts shall not be regarded as statutory accounts for the purposes of section 8 of this Act.
(6)In this paragraph “the relevant year” means the last financial year of the Corporation or Board ending before the appointed day.