Dormant Account: What figures should I be using?


R

Richard

I need to file with Companies House a balance sheet for my dormant account.
The company has never traded as yet.

I am the only person who has any capital in the company, so I am the only
subscriber. I registered my company and the Memorandum of Association says
10 shares "taken by each subcriber". Not long afterwards I went to the bank
to put in £10 representing the capital I was putting into the company. In my
minds eye, I figured that if the company were to make up share certificates
I'd get 10, (each with a nominal value of £1.00).

When I got to the bank they said I must start it with £50.00, so I put in
£50.00. I've got a Memorandum saying I started the company with 10 shares.
Presumably then it's like each share has in fact a nominal value of £5.00. I
think putting in £50 has made that so. Yes, that must now be the case.

In the balance sheet I have the following boxes to make out:

Called Up Share Capital Not Paid: £____

Current Assets: (In bank & in hand): £____

Net Assets: £____

Authorised Share Capital: (Number ____ Share____ Type____) value: £____

Issued Share Capital: (Number ____Share____Type____) Value: £____

Total Shareholders Funds:

During the year, the company allotted ____ ordinary shares

with an aggregate nominal value of £____

the consideration received by the company was £____

The account actually has £50.01 in it, presumably the penny is interest.

What figures to I put in the boxes? TIA.
 
R

Richard

I said:
I need to file with Companies House a balance sheet for my dormant account.
The company has never traded as yet.

I am the only person who has any capital in the company, so I am the only
subscriber. I registered my company and the Memorandum of Association says
10 shares "taken by each subcriber". Not long afterwards I went to the
bank
to put in £10 representing the capital I was putting into the company. In
my
minds eye, I figured that if the company were to make up share
certificates
I'd get 10, (each with a nominal value of £1.00).

When I got to the bank they said I must start it with £50.00, so I put in
£50.00. I've got a Memorandum saying I started the company with 10
shares.
Presumably then it's like each share has in fact a nominal value of £5.00.
I
think putting in £50 has made that so. Yes, that must now be the case.

In the balance sheet I have the following boxes to make out:

Called Up Share Capital Not Paid: £____

Current Assets: (In bank & in hand): £____

Net Assets: £____

Authorised Share Capital: (Number ____ Share____ Type____) value: £____

Issued Share Capital: (Number ____Share____Type____) Value: £____

Total Shareholders Funds:

During the year, the company allotted ____ ordinary shares

with an aggregate nominal value of £____

the consideration received by the company was £____

The account actually has £50.01 in it, presumably the penny is interest.

What figures to I put in the boxes? TIA.
Actually I just noticed that in Memorandum, it's is expressly stated that
the Company's share capital is £10, divided into 10 shares of £1 each.

I think as a private limied company I can have any authorized capital I
want. Theoretically from say, £1 to £100,000,000.

Okay, so what is the purpose of saying that the Company's share capital is
£10, divided into 10 shares of £1.00 each. Why is the Memorandum noting
that? I was originally going to put in £10 into the account, but why is the
Memorandum noting this?

Why is Companies House asking me about authorised share Capital if there are
no higher or lower limits?

I don't know what called-up share capital is or issued share capital. In
fact it would be helpful if all the terms were explained.
 
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T

Troy Steadman

I need to file with Companies House a balance sheet for my dormant account.
The company has never traded as yet.

I am the only person who has any capital in the company, so I am the only
subscriber. I registered my company and the Memorandum of Association says
10 shares "taken by each subcriber". Not long afterwards I went to the bank
to put in £10 representing the capital I was putting into the company. In my
minds eye, I figured that if the company were to make up share certificates
I'd get 10, (each with a nominal value of £1.00).

When I got to the bank they said I must start it with £50.00, so I put in
£50.00.  I've got a Memorandum saying I started the company with 10 shares.
Presumably then it's like each share has in fact a nominal value of £5.00. I
think putting in £50 has made that so. Yes, that must now be the case.

In the balance sheet I have the following boxes to make out:

Called Up Share Capital Not Paid: £____

Current Assets: (In bank & in hand): £____

Net Assets: £____

Authorised Share Capital: (Number ____ Share____ Type____) value: £____

Issued Share Capital: (Number ____Share____Type____) Value: £____

Total Shareholders Funds:

During the year, the company allotted  ____ ordinary shares

with an aggregate nominal value of £____

the consideration received by the company was £____

The account actually has £50.01 in it, presumably the penny is interest..

What figures to I put in the boxes?  TIA.


DR Bank £50
CR Creditors (Directors Loan A/C) £40
CR Share capital £10
 
M

Mike Lewis

I need to file with Companies House a balance sheet for my dormant
account.
The company has never traded as yet.

I am the only person who has any capital in the company, so I am the only
subscriber. I registered my company and the Memorandum of Association says
10 shares "taken by each subcriber". Not long afterwards I went to the
bank
to put in £10 representing the capital I was putting into the company. In
my
minds eye, I figured that if the company were to make up share
certificates
I'd get 10, (each with a nominal value of £1.00).

When I got to the bank they said I must start it with £50.00, so I put in
£50.00. I've got a Memorandum saying I started the company with 10 shares.
Presumably then it's like each share has in fact a nominal value of £5.00.
I
think putting in £50 has made that so. Yes, that must now be the case.

In the balance sheet I have the following boxes to make out:

Called Up Share Capital Not Paid: £____

Current Assets: (In bank & in hand): £____

Net Assets: £____

Authorised Share Capital: (Number ____ Share____ Type____) value: £____

Issued Share Capital: (Number ____Share____Type____) Value: £____

Total Shareholders Funds:

During the year, the company allotted ____ ordinary shares

with an aggregate nominal value of £____

the consideration received by the company was £____

The account actually has £50.01 in it, presumably the penny is interest.

What figures to I put in the boxes? TIA.


DR Bank £50
CR Creditors (Directors Loan A/C) £40
CR Share capital £10
The extra £40 means its not dormant. Only certain transactions can take
place for a company not to .lose its dormant status. Paying in the original
share capital is one of them. Paying in an extra £40 isn't.
 
R

Richard

I need to file with Companies House a balance sheet for my dormant
account.
The company has never traded as yet.

I am the only person who has any capital in the company, so I am the only
subscriber. I registered my company and the Memorandum of Association says
10 shares "taken by each subcriber". Not long afterwards I went to the
bank
to put in £10 representing the capital I was putting into the company. In
my
minds eye, I figured that if the company were to make up share
certificates
I'd get 10, (each with a nominal value of £1.00).

When I got to the bank they said I must start it with £50.00, so I put in
£50.00. I've got a Memorandum saying I started the company with 10 shares.
Presumably then it's like each share has in fact a nominal value of £5.00.
I
think putting in £50 has made that so. Yes, that must now be the case.

In the balance sheet I have the following boxes to make out:

Called Up Share Capital Not Paid: £____

Current Assets: (In bank & in hand): £____

Net Assets: £____

Authorised Share Capital: (Number ____ Share____ Type____) value: £____

Issued Share Capital: (Number ____Share____Type____) Value: £____

Total Shareholders Funds:

During the year, the company allotted ____ ordinary shares

with an aggregate nominal value of £____

the consideration received by the company was £____

The account actually has £50.01 in it, presumably the penny is interest.

What figures to I put in the boxes? TIA.

DR Bank £50
CR Creditors (Directors Loan A/C) £40
CR Share capital £10

----

*For the purposes of making out Companies House Dormant Company Balance
sheet:*

1 The authorised (nominal) share capital is the number of shares and their
value at the company's start. This figure can be altered later by resolution
and notification of Companies House. The value is a nominal value (in my
case £1 per share).

2 Shares can of course can be sold at a higher price than the nominal value.
I think this is true at the start of the company and not only true after
increase in capital over time by trading. (?)

3 Issued Share Capital concerns share certificates issued and bought and in
possesion of the members. (?)

4 The Called-Up Share Capital Not Paid is the amount of shares monies that
the company has not called payment for (?) Or shares called for, but not
paid? Probably the latter. (?)

5 The allotment of shares are the number of shares chosen to be sold. Not
all these shares need to have been actually sold. (?)

Once I can get some confirmation on 1-5 then I think I can begin to make out
Companies House Dormant Balance Sheet.
 
P

PeterSaxton

DR Bank £50
CR Creditors (Directors Loan A/C) £40
CR Share capital £10

----

*For the purposes of making out Companies House Dormant Company Balance
sheet:*

1 The authorised (nominal) share capital is the number of shares and their
value at the company's start. This figure can be altered later by resolution
and notification of Companies House. The value is a nominal value (in my
case £1 per share).

2 Shares can of course can be sold at a higher price than the nominal value.
I think this is true at the start of the company and not only true after
increase in capital over time by trading. (?)

3 Issued Share Capital concerns share certificates issued and bought and in
possesion of the members. (?)

4 The Called-Up Share Capital Not Paid is the amount of shares monies that
the company has not called payment for (?) Or shares called for, but not
paid? Probably the latter. (?)

5 The allotment of shares are the number of shares chosen to be sold. Not
all these shares need to have been actually sold. (?)

Once I can get some confirmation on 1-5 then I think I can begin to make out
Companies House Dormant Balance Sheet.
Richard

Try reading what Mike has said.

You also have to think about the difference between authorised and
issued share capital.

Why did you even open a bank account if you were not going to trade
imminently?
 
R

Richard

DR Bank £50
CR Creditors (Directors Loan A/C) £40
CR Share capital £10

----

*For the purposes of making out Companies House Dormant Company Balance
sheet:*

1 The authorised (nominal) share capital is the number of shares and their
value at the company's start. This figure can be altered later by
resolution
and notification of Companies House. The value is a nominal value (in my
case £1 per share).

2 Shares can of course can be sold at a higher price than the nominal
value.
I think this is true at the start of the company and not only true after
increase in capital over time by trading. (?)

3 Issued Share Capital concerns share certificates issued and bought and
in
possesion of the members. (?)

4 The Called-Up Share Capital Not Paid is the amount of shares monies that
the company has not called payment for (?) Or shares called for, but not
paid? Probably the latter. (?)

5 The allotment of shares are the number of shares chosen to be sold. Not
all these shares need to have been actually sold. (?)

Once I can get some confirmation on 1-5 then I think I can begin to make
out
Companies House Dormant Balance Sheet.
Richard

Try reading what Mike has said.

You also have to think about the difference between authorised and
issued share capital.

Why did you even open a bank account if you were not going to trade
imminently?

---

I'm trying to figure out my options as to what number of shares I can say I
bought (in my company).

If the value of a share in a dormant company can be sold at a premium, then
perhaps I have the option of accounting for the £50 in the bank as say 5
shares at £10 each. I would have an agreed to buy 10 in the Memorandum
(subscripition), Called-Up shares of 5 - paid in full. Called Up Share
Capital Not Paid would be 0. That would leave 5 shares that could be
Called-Up by my company.

Alternatively I say all 10 shares were Called-Up and paid in full. Which
amounts to £10 capital by shares, or £50 dependinbg whther sold at a
premium.

If I were to do the Memorandum again, I think I may have had authorised 100
shares and issed only 10 to myself, leaving 90 to be subcribed to by others.

I'm trying to figure out whther I can sensibly allocate all of the £50 in
the bank to share capital.
 
P

PeterSaxton

Richard

Try reading what Mike has said.

You also have to think about the difference between authorised and
issued share capital.

Why did you even open a bank account if you were not going to trade
imminently?

---

I'm trying to figure out my options as to what number of shares I can sayI
bought (in my company).

If the value of a share in a dormant company can be sold at a premium, then
perhaps I have the option of accounting for the £50 in the bank as say 5
shares at £10 each. I would have an agreed to buy 10 in the Memorandum
(subscripition),  Called-Up shares of 5 -  paid in full.  Called UpShare
Capital Not Paid would be 0. That would leave 5 shares that could be
Called-Up by my company.

Alternatively I say all 10 shares were Called-Up and paid in full. Which
amounts to £10 capital by shares, or £50 dependinbg whther sold at a
premium.

If I were to do the Memorandum again, I think I may have had authorised 100
shares and issed only 10 to myself, leaving 90 to be subcribed to by others.

I'm trying to figure out whther I can sensibly allocate all of the £50 in
the bank to share capital.
Why are you wanting to do this?

You should issue them at nominal value.
 
R

Richard

My company is dormant, I'm not trading. Companies House wants me to make out
a balance sheet for my dormant company.

I do know that I cannot have 0 shares issued.

Net assets (Called Up Share Capital Not Paid + Current assets (In bank & in
hand), must equal Issued Share Capital according to the balance sheet.

I've got £50 in the bank. That means Issued Capital MUST be £50 in order to
obtain a balance!

That can only be done by the shares being sold at a premium.

That's the only answer I can see without adjusting the monies in the bank
account.
 
R

Richard

Richard said:
My company is dormant, I'm not trading. Companies House wants me to make
out a balance sheet for my dormant company.

I do know that I cannot have 0 shares issued.

Net assets (Called Up Share Capital Not Paid + Current assets (In bank &
in hand), must equal Issued Share Capital according to the balance sheet.

I've got £50 in the bank. That means Issued Capital MUST be £50 in order
to obtain a balance!

That can only be done by the shares being sold at a premium.

That's the only answer I can see without adjusting the monies in the bank
account.
I'd have to say there is £10 Cash at Bank and in Hand, in order to say Issed
Shares are £10. Even though there is £50 there.

But if I can have sold the shares at premium, is it not just as easy to say
so, and say issed shares is £50?
 
R

Richard

Richard said:
I'd have to say there is £10 Cash at Bank and in Hand, in order to say
Issed Shares are £10. Even though there is £50 there.

But if I can have sold the shares at premium, is it not just as easy to
say so, and say issed shares is £50?
I mean say *the company* sold the shares at a premium.

On the form I have to fill out it says:

"During the year, the company allotted ____ ordinary shares

with an aggregate nominal value of £____

the consideration received by the company was £____"

If say 5 shares were allotted (half of what could have been) with an
aggregate nominal value of £5, the consideration received by the company
would be £50, if shares were sold at a premium value of £10 each.

I think the sentence is intimating shares in a dormant company can have been
offered at a premium.
 
P

PeterSaxton

My company is dormant, I'm not trading. Companies House wants me to make out
a balance sheet for my dormant company.

I do know that I cannot have 0 shares issued.

Net assets (Called Up Share Capital Not Paid + Current assets (In bank & in
hand), must equal Issued Share Capital according to the balance sheet.

I've got £50 in the bank. That means Issued Capital MUST be £50 in order to
obtain a balance!

That can only be done by the shares being sold at a premium.

That's the only answer I can see without adjusting the monies in the bank
account.
Your company is not dormant. Not trading and not dormant is not the
same thing.

Why are you posting and then ignoring what Mike has said.
 
R

Richard

My company is dormant, I'm not trading. Companies House wants me to make
out
a balance sheet for my dormant company.

I do know that I cannot have 0 shares issued.

Net assets (Called Up Share Capital Not Paid + Current assets (In bank &
in
hand), must equal Issued Share Capital according to the balance sheet.

I've got £50 in the bank. That means Issued Capital MUST be £50 in order
to
obtain a balance!

That can only be done by the shares being sold at a premium.

That's the only answer I can see without adjusting the monies in the bank
account.
Your company is not dormant. Not trading and not dormant is not the
same thing.

Why are you posting and then ignoring what Mike has said.

-------

Of course I'm a dormant company.

I'll have to phone Companies House, they will know whether the shares can
have been sold at a premium.
 
R

Richard

Richard said:
Your company is not dormant. Not trading and not dormant is not the
same thing.

Why are you posting and then ignoring what Mike has said.

-------

Of course I'm a dormant company.

I'll have to phone Companies House, they will know whether the shares can
have been sold at a premium.
Okay I phoned Companies House.

The dormant balance is only concerned with shares. So, I can put net assets
at £10. That means I don't have to put a premium value on the shares. In
fact you are not suppossed to put a premium value on the shares. I was
told that although the self check system on the PDF file does not balk
if you put a premium.

The extra £40 could be petty cash, or a loan. But should not appear in the
dormant balance sheet.

One thing I did not know is that I don't even have to have opened a bank
account. I'm sure one time someone said I had to for Companies House
registration. Perhaps this is okay if the intention is not to trade for a
while. Of course to open a bank account I had to put £50 in in my partcular
case, I could not have opened it will zero funds at my bank.

I'm not ignoring Mike. I had two seemingly viable options.
 
M

Mike Lewis

----- Original Message -----
From: "Richard" <some_email@ntlworld.com>
Newsgroups: uk.business.accountancy
Sent: Monday, July 27, 2009 8:53 AM
Subject: Re: Dormant Account: What figures should I be using?

Okay I phoned Companies House.

The dormant balance is only concerned with shares. So, I can put net
assets
at £10. That means I don't have to put a premium value on the shares. In
fact you are not suppossed to put a premium value on the shares. I was
told that although the self check system on the PDF file does not balk
if you put a premium.

The extra £40 could be petty cash, or a loan. But should not appear in the
dormant balance sheet.

One thing I did not know is that I don't even have to have opened a bank
account. I'm sure one time someone said I had to for Companies House
registration. Perhaps this is okay if the intention is not to trade for a
while. Of course to open a bank account I had to put £50 in in my
partcular
case, I could not have opened it will zero funds at my bank.

I'm not ignoring Mike. I had two seemingly viable options.
You can't leave the £40 out. It is in the bank account whether you like it
or not and so it does have to appear in the balance sheet.
 
P

PeterSaxton

Okay I phoned Companies House.

The dormant balance is only concerned with shares. So, I can put net assets
at £10. That means I don't have to put a premium value on the shares. In
fact you are not suppossed to put a premium value on the shares. I was
told that although the self check system on the PDF file does not balk
if you put a premium.
What's a dormant balance? Do you mean dormant company balance sheet?
If so it isn't just involved with shares.
The extra £40 could be petty cash, or a loan. But should not appear in the
dormant balance sheet.
Of course it should appear on the balance sheet - but it is not a
dormant company.
One thing I did not know is that I don't even have to have opened a bank
account. I'm sure one time someone said I had to for Companies House
registration. Perhaps this is okay if the intention is not to trade for a
while. Of course to open a bank account I had to put £50 in in my partcular
case, I could not have opened it will zero funds at my bank.
You didn't have to open a bank account. This is the kind of problem
you get when you list to people who don't know what they are talking
about.
I'm not ignoring Mike. I had two seemingly viable options.
What are the viable options?

You had a bank transaction which disqualified the company from being
dormant. Please accept that and stop talking about dormant.
 
J

Jonathan Bryce

Richard said:
I'm trying to figure out whther I can sensibly allocate all of the £50 in
the bank to share capital.
If you allocate it all to share capital, you can't take the money back out
in the future, whereas if you allocate it as a loan, you can. For that
reason, it is better to allocate it as a loan.
 
R

Richard

Jonathan Bryce said:
If you allocate it all to share capital, you can't take the money back out
in the future, whereas if you allocate it as a loan, you can. For that
reason, it is better to allocate it as a loan.
There is also the reverse. Since I had to put £50 in the bank to start the
account, because the bank required some funds deposited, perhaps I don't
have to allocate the £50 to any transaction by my start up company?
 
P

PeterSaxton

If you allocate it all to share capital, you can't take the money back out
in the future, whereas if you allocate it as a loan, you can.  For that
reason, it is better to allocate it as a loan.
I don't think original subscribers can subscribe at a premium.
 
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P

PeterSaxton

There is also the reverse. Since I had to put £50 in the bank to start the
account, because the bank required some funds deposited,  perhaps I don't
have to allocate the £50 to any transaction by my start up company?
What do you mean? Is it a company bank account? If it is a company
bank account you are talking nonsense.
 

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