Why shorten year end by 1 day?

Why shorten year end from 31 Aug 17 to 30 Aug 17?

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I've taken two different new clients on in hte past couple of months with year ends of 31/08/17.  

Their respective accountants have both shortened the year-ends to 30/08/17.

Am I missing a trick here?  Is there a blindingly obvious reason to do this?

Replies (10)

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By fellowcraft
06th Feb 2018 13:01

Apologies, needs correction, they shortened 2016 year ends to 30th, but then both filed accounts to 31st.

Time for a glass of wine.

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By Portia Nina Levin
06th Feb 2018 13:13

There is a blindingly obvious reason for doing this. It involves WHEN the notice to shorten was filed, and WHAT the effect of its timing was.

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By Wanderer
06th Feb 2018 13:17

They were buying (up to nearly) 3 months extra time to file the accounts.

Good luck with the clients. You may find that they are habitually late in getting the information to you.

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By Justin Bryant
06th Feb 2018 13:35

Yes, this is a very well known trick to buy an extra 3 months time to file the accounts.

s442 Companies Act 2006

If the relevant accounting reference period is treated as shortened by virtue of a notice given by the company under section 392 (alteration of accounting
reference date), the period is—
(a) that applicable in accordance with the above provisions, or
(b) three months from the date of the notice under that section,
whichever last expires.

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Replying to Justin Bryant:
Flag of the Soviet Union
By thevaliant
06th Feb 2018 15:07

And the comedy is that you can do it again (once more) just before the next deadline, giving you nearly fifteen months to file the accounts (CT & return are overdue of course but not the accounts).

We have a client who was a complete nightmare with records. Originally:

February year end (2015). We knew meeting November deadline would be a challenge so partner (not knowing shorten trick) extended six months to August.
Come May 2016, still no sign of any records (not even bank statements) so shorten a day.
Come August 2016, getting closer, but still no cigar so shorten again.
File November 2016 - In time, and no penalties from CH.

It struck me, as I filed the August 2015 accounts at Companies House, that the last set of filed accounts just before I hit 'File' was marked as February 2014, some 33 months ago and yet the accounts I was about to file was not late.

33 months since the last filing. Just think on that.

Thanks (2)
Replying to Justin Bryant:
RLI
By lionofludesch
24th Mar 2018 15:53

Justin Bryant wrote:

Yes, this is a very well known trick to buy an extra 3 months time to file the accounts.

Apparently not as well known as you imply.

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Replying to lionofludesch:
Flag of the Soviet Union
By thevaliant
26th Mar 2018 12:23

Our firm did not know about this for many years.

We found it out when following a company (which was not a client) suddenly did it.

Whilst we 'frown' upon it, we do it from time to time now we know about it.

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Replying to vishal23:
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By andy.partridge
24th Mar 2018 09:39

Yeah, what he said.

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Teignmouth
By Paul Scholes
28th Mar 2018 10:35

Just been looking at a firm of accountants' own filings. They shortened from 31 March to 30 March in December 2016 then, in December 2017 from 30th to 29th and, low and behold, have just shortened from 29th to 28th.

They are clearly struggling and, having time on my hands, wondered if I should offer to help them out?

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Replying to Paul Scholes:
RLI
By lionofludesch
28th Mar 2018 10:44

I hate doing my own accounts.

I don't get paid for it.

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