Am trying to make sense of some sub-division, reclassification, and re-designation of share capital according to written resolution passed.
Share capital of 1000 Preference Shares of £10 each were sub-divided into 10,000,000 Preference Shares of £0.001.
10,000,000 Preference Shares were re-designated to 8,219,361 Ordinary 'A' shares of £0.001 and 1,780,639 Ordinary 'B' shares of £0.001.
The written resolutions then state that 66,947 Ordinary 'A' shares and 1,780,639 (small numbers transferred to various shareholders) Ordinary 'B' shares were transferred to other shareholders for a nominal value of £1.00 (the 'consideration') and accordingly it was noted that no stamp duty should become payable given that the Consideration for each transfer is below the threshold that stamp duty becomes payable.
My understanding is that the nominal value of the shares is £0.001 therefore how is it possible for the transfer of shares to take place at a nominal value of £1.00 which would exceed the stamp duty threshold ??
Needless to say am totally confused how this should be reported in the statutory accounts.
Any explanations would be greatly appreciated.
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All you need to reflect in the statutory accounts is what you set out in your second and third paragraphs - which seems clear enough.
The transfers of shares, and the question of whether any stamp duty was payable, will be of great interest to the parties to those transfers, but are irrelevant to the company's accounts.
Nominal
has two different meanings. Shares have a Nominal Value meaning a designated value.
The transfer was for a nominal value, meaning a nominal amount of money or notional value so there was actual consideration.