FD's Diary - Dormant

The FD spends a hot afternoon looking at his dormant companies

August 31 ' It's too hot to think around here so I'm giving myself some light duties to pass the time with.

Like doing the accounts of our three dormant subsidiaries. They've been knocking around for years and the auditors are quite happy for me to do them and file the stuff with Companies House.

But the real question is, what is there to stop me getting rid of them? They have almost no reserves between them, £6 of share capital between them and no assets or liabilities bar tiny inter company ones. And they have no guarantees and haven't traded for yonks.

Wouldn't it be a blessing to put them out of their misery? Or should I change the names of the ones that look a bit like the parent company first, just to stop anyone getting the wrong impression?

Anyone got any thoughts?

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August 25 ' Where has time gone? It's bad enough going away. Coming back is as hard.

We had another day this week when we couldn't use the system for invoicing and stock had to leave on manual delivery notes or entirely close us down. We have, we think, solved the problem now (I'm assured it was a network issue and I needn't bother myself with the details) but it's interesting to see the challenges this has raised.

AJ and #4 have not work with manual systems, at least, not in commerce in AJ's case. And it's interesting to see them floundering about how to reconcile manual systems with the computer. Ticking things off like that when they even do the bank recs on the system now is just not built into their way of thinking.

Makes me almost nostalgic for these big bound nominal ledgers I can just recall from my youth and the endless hours trying to make the sales ledger control account balance. I still draw out T accounts every now and again to help me think about where to put the odd dangling debit I create when writing a journal. I must be showing my age.

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August 22 ' Back to my desk. I was really keen to return. Now I'm not so sure. It seems like we had real IT problems whilst I was away and that hit our ability to get invoices out. This meant some items were delivered with manual delivery notes. Now the team are working through to make sure everything has been billed, and once only. What a waste of time.

But, the important news is we decided on the new arrivals name. Youngest son was adamant he wanted a sister called Olivia. The family generally resisted my call for her to be called Helen Mary Rose Camilla (HMRC) and were even less amused when I explained why. And in the end we all agreed youngest son had done a good job.

Trouble is she's already being referred to as Baby O.

Which reminds me; I had better talk to Ops about paternity leave.

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August 5 ' Pleasant surprise this morning. I'd been fretting over doing my usual 'handover' before going on holiday to let people know what I'm worried about and instead had #3 at my desk at 9.05 telling me that she wanted to say what her priorities were for the next fortnight and asking if I wanted to add anything. That was real initiative. She had also anticipated much of what I would have said, although I did have some things I could suggest (thankfully). My only worry now is that if she's getting this good she'll want to leave soon. I'm not sure what I'd do without her.

The result was I could put more effort into a discussion with Ops which had to be moved from its usual lunch slot as I'll need that time to finish the accounts today. His holiday partly overlaps with mine ' but we're happy nothing can go much awry in 2 days. His problem is a real one though ' the start of the new product roll out is showing that set up time on site is taking longer than expected. Some one day jobs have rolled into a second day and that knocks the whole economics of the thing. We spent most of our time looking at this and discussing what initiatives to take on it. I'll be reviewing and monitoring this when I'm back with the Ops team.

Which just leaves me with the accounts to finish and the need to consider the agenda for the family holiday. The offspring have decided that the priority item is to agree on the name of the new arrival. The fact that we know it's going to be a girl helps. I fear my troubles are only just beginning!

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August 4 ' Holiday is coming up. Thankfully this time #3 and I have coordinated properly and so she is here to hold the fort, as is everyone else.

But it does mean I have been working hard on all the key issues in the July accounts to get them out by Friday. I don't really approve of such a rush. I know the Americans think you can get year ends audited in about a fortnight, but I always think a little less haste improves the quality of a set of accounts. Its as if they mature with time, rather like a good wine. About 7 to 8 working days is my normal month end target. I wonder if the Americans did the same they'd have fewer accounting scandals? It's amazing how many issues are solved by going home at night and looking at them afresh in the morning.

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August 2 ' I'm sure I should welcome an invitation to lunch from the bank manager. He does, after all, assure me that we are one of just 50 customers to whom he devotes most of his time so I suppose every now and again he has to show up. If the others use as much time as we do then he must do very little in the meantime. And that's just it. Of course we have banking needs. But they're hardly demanding if, as I suspect, routine transaction processing is something he does not get involved in.

Of course we do have the odd financing choice to make. For example, do we buy or lease vans and if we buy do we borrow or use cash? But even that question is not a big one now that the shareholders seem to be blocking any extra dividends and we have reducing real cash pressure within the business. So what will we talk about? I just hope he doesn't reach the desperate level that one manager once did with me when he suggested I borrow to finance fixed asset purchases as that would help me identify the cost in the books. I hadn't the heart to point out to him that we accountants had by now found other ways of doing that which were, all things considered, a lot cheaper and more effective.

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July was dominated by the FD's VAT inspection.

For previous installments of the FD's Diary, see:
June
May
April
March
February
January
December
November
October
September
August
July
June
May
April
March
February
January
December
November
October.