I have a question about merging two companies.
Both companies have common shareholders and it's been decided that it would be easier to combine the two and report as one entity.
Company A isn't buying the shares of Company B - Company B will remain dormant after the switch and will most probably be wound up.
All contracts with customers, suppliers etc have been switched to Company A.
If Company A takes on the Fixed Assets, the debtors & creditors of Company B and any intercompany balance between the two is written off, Company B should just have share capital and reserves (losses) left over.
I'm just wondering what happens to the losses/reserves in Company B, can they be transferred to Company A?