Note on illegal Dividends

Note on illegal Dividends

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If the directors knowingly has taken illegal dividends

I assume there needs to be a note in the accounts ? 

 

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By johngroganjga
19th Aug 2016 12:44

I can't see the need for one. What would such a note say?

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By JimLittle
19th Aug 2016 14:15

I ask the question as came across this old article and not sure if still relevant. It mentions to include a note in illegal dividends where directors not intentionally or knowingly made the distribution. Surely an illegal dividend note would be useful to other parties ?

http://www.accaglobal.com/uk/en/technical-activities/technical-resources...

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By Panamera
19th Aug 2016 14:33

I think the directors should receive legal advice before including any statement in the accounts that might indicate that they have failed one of their directorly duties or have committed a Companies Act offence, which is what the last disclosure suggested foes.

Personally I would not be inclined to pay any attention to an article that describes an ultra vires dividend as illegal, whoever's website it appears on.

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