Assets treatment on wound up

How do I treat an assets of a company on wound up, the assets has a small amount of NBV.

Didn't find your answer?

Do we have to apply another value to these assets or okay to write it off,?

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By lesley.barnes
20th Oct 2019 09:57

How much is a small amount and what is happening to the assets?

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paddle steamer
By DJKL
20th Oct 2019 17:02

You really need to look at this at cessation of trade rather than at wind up, what is going to be happening with the assets?

https://library.croneri.co.uk/cch_uk/tpo/b-110-280

https://www.accountingweb.co.uk/any-answers/capital-allowances-closing-b...

If assets are say stock, debtors etc you also need to consider recoverability/values, but of course with stock you are more looking at lower of costs and nrv.

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By Fum
21st Oct 2019 19:26

Thanks for your response, the client is still silent about what will be happening to the asset, if he (the director) decides to take over the asset (which are tangible and intangible fixed assets) for personal use, what is the best way to determine the net realisable value and the treatment in the books? or if the assets are worthless?

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Replying to DJKL:
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By Fum
21st Oct 2019 19:27

Thanks for your response, the client is still silent about what will be happening to the asset, if he (the director) decides to take over the asset (which are tangible and intangible fixed assets) for personal use, what is the best way to determine the net realisable value and the treatment in the books? or if the assets are worthless?

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paddle steamer
By DJKL
22nd Oct 2019 11:05

Value them is the answer, but how one does that is the subject of whole books not posts on here.

To be pragmatic

1. What sort of quantum is involved is a decent starting point, if really not significant doubt anyone will get too bothered.?

eg. I have just finished practicing as an accountant, my company has a number of assets mainly being a couple of laptops, printers, external backup drive,a desk, a chair (that I have worn into the ground), some decent condition IKEA shelving, a decent heater for the room and a really useful desk which is two very old chests of drawers from the 1960s with a kitchen worktop slung across them - it is a very, very long desk which I really found helpful(though I have found since removing the printer from it that the top has warped) What are these worth, not a lot, you would be hard pressed to give the furniture away, whole lot say £150 on a good day.

2. Re goodwill/intangibles- is there actually anything there?

In my case no, I refused to sell my clients and placed them with others instead for no consideration-I found them accountants I thought would suit them or they found them, no value, what does your client actually have needs to be addressed? . If the company is to be wound up was that because it could not wash its face, if so is there any value in the intangibles, if it was thriving why is he winding it up?

Fixed assets can end up worth a minus sum (I know, tenants leave desks/chairs/things in offices we let and it costs us to get rid of them).

Goodwill; in my experience most people re small business entities (no staff) vastly overestimate its worth, usually when one actually looks at what the business makes as a profit ,and adjust for normal salary for the director, it is actually worth nothing. (Except accountancy GRF, of course)

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By Fum
22nd Oct 2019 15:13

Thank this is quite helpful

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