Happy New Year!
Scenario: A director is paying himself monthly dividends from available positive reserves. Reserves are exhosted mid year and director stops paying dividends. All seems fine. But at the YE, we assessed Reserves and Current Year losses and could see that overall Reserves are so negative that they cannot even cover the dividends paid in the first half of the year.
Question: Do we need to reverse dividends paid in the first half of the year?
At YE the picture was very clear, the company could not pay any dividends. How do we deal with it mid year when we do not know what lays ahead?