I have two Ltd Companies, A owns 100% of the share capital of B. B is the trading company (tech start up). Investor pays £500k in B's bank account. However the intention is that the investor will get shares in A for his investment (no idea why he did not pay the money into As account in the first place). Lawyers are then engaged to produce board minutes and resolutions to produce the paper trail to show that the deposits are to be treated as convertible loan notes and which convert into equity in company A. The investment, the issuance of loan notes and the conversion into equity all happen in the same financial year. The shares were provided by the allotment of an additonal 50 x £1 ordinary shares in A. There is also a clause in the loan notes that the 'loans' can be used anywhere in the group. Investor wants shares in A. So my question is - with the investors initial money in B (and mostly already spent in B) and with a paper trail supporting the issuing of shares in A what would be the accounting entries to move the investment so it ends up as share premium in A. My initial thoughts were to create a straight forward intercompany transaction but the director asked whether there are any alternatives to avoid B having a negative balance sheet. I have explained the intercompany would eliminate upon consolidation in the group accounts but he was keen to show B with a clean(ish) balance sheet. Any thoughts appreciated - thanks in advance.