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Closing a Pte Ltd

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lkh66
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Closing a Pte Ltd

Postby lkh66 » Tue, 12 Jul 2016 6:58 pm

hi

my friend trying to close /strike off his pte ltd.
he prepare the following
1.financial statement cash flow
2.financial statement changes in equity
3.financial statement comprehensive income
4.financial statement financial position

he email those company that provide services on strike off company services.
they told his 4 financial statement is correct but he need to zero his financial statement into report.

do any of you has any sample to view or any advise on how to zero his financial statement?

thanks in advance

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Strong Eagle
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Re: Closing a Pte Ltd

Postby Strong Eagle » Tue, 12 Jul 2016 8:15 pm

You cannot strike off a company that has remaining assets or liabilities. If you have liabilities, ie, debts to trade vendors, loans, etc, you must either pay them off or obtain a letter of forgiveness from each vendor/lender stating that they forgive the amounts owed. Then you can strike off the liabilities.

If you have assets you must dispose of them. For furniture, fixtures, software, etc, you must sell or give them away. For cash, you must distribute except that needed for closing expenses. Then you can formally strike off the company.

lkh66
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Re: Closing a Pte Ltd

Postby lkh66 » Tue, 12 Jul 2016 8:35 pm

hi strong eagle

thanks for your replying.

yes.
there's no assets or liabilities where his 4 consolidate financial statements has vetted by those accounting company to close his pte ltd.
the accounting company told him that his 4 consolidate financial statement is correct but still need 1 financial statement final report [cash flow + financial position + change in equity + comprehensive income].

my friend try to save some $ .

so my friend wonder how financial statement final report look like.

is there attach file feature, so i can attach the 4 file to let you have better understanding.

please advise


lkh66
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Re: Closing a Pte Ltd

Postby lkh66 » Tue, 12 Jul 2016 9:21 pm

hi strong eagle

yes we know that topic that u give the link.
but we are looking for consolidate financial statement final report sample.

:(

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Re: Closing a Pte Ltd

Postby lkh66 » Wed, 13 Jul 2016 3:00 pm

hi strong eagle

i manage to learn how to insert image.

could you help me to see whats wrong with the accounts and how do we zerolised it in order to close the pte ltd?

please help
thanks alot

Cash Flows
Image
Changes in Equity
Image
Comprehensive Income
Image
Financial Position
Image
Dividend
Image
Dividend Letter
Image

lkh66
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Re: Closing a Pte Ltd

Postby lkh66 » Fri, 15 Jul 2016 7:54 am

hi

any help please?

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Strong Eagle
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Re: Closing a Pte Ltd

Postby Strong Eagle » Fri, 15 Jul 2016 10:08 am

It's a complicated question... maybe I will have time this weekend to look at my own windup tax filings.

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Re: Closing a Pte Ltd

Postby lkh66 » Fri, 15 Jul 2016 11:02 am

hi strong eagle
noted with thanks

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Re: Closing a Pte Ltd

Postby cutejesey » Sun, 17 Jul 2016 4:52 pm

Financial position doesn't tally


Sent from my iPhone using Tapatalk

lkh66
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Re: Closing a Pte Ltd

Postby lkh66 » Wed, 20 Jul 2016 9:03 pm

how to tally
thanks

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Re: Closing a Pte Ltd

Postby Strong Eagle » Sat, 23 Jul 2016 11:51 pm

You have made a one dollar error and your balance sheet is out of balance. Let’s start at the beginning.

You incorporate the company 9/9/2014. The balance sheet for 30/9/2014 (or as of 9/9) should look like this:

Journal Entries
Debit: Cash: 1
Credit: Paid Up Capital: 1

Balance Sheet
Assets
Cash: 1

Net Worth
Paid Up Capital: 1
Total Liabilities and Net Worth 1

Now you have business activity for the rest of the year. Let’s take a look at your income statement for 2014. It looks like

Income Stmt
Income: 7,970
Expense: 2,088
Net Profit: 5,882

But this is double entry bookkeeping… and therefore there must be corresponding balance sheet accounts affected. Since you have no liabilities, all your expenses must have been paid for in cash. And since there is no cash end of period, your journal entries must be:

Journal
Credit: Income: 7,970
Debit: Cash: 2,087
Debit: Receivables: 5,883
AND
Debit: Admin Expense: 2,088
Credit: Cash: 2,088

Balance Sheet
Assets
Cash: 0
Receivables: 5,883
Total Assets: 5,883

Liabilities: 0

Net Worth
Paid Up Capital: 1
Retained Earnings – current period: 5,882
Total Liabilities and Net Worth: 5,883

Using these numbers, your cash flow statement for 2014 is correct… you generated -$1 of cash after paying your admin expenses. You are using the indirect cash flow method. Under the direct method:

Cash Flow
Cash from Operating Activity
Cash receipts from customers: 2,087
Cash paid for expenses: -2,088
Cash generated from operations: -1

Cash from Financing Activities
Sale of Shares: 1
Cash generated from financing: 1

Net Increase/Decrease Cash: 0

So… 2014 is OK… everything works. But your 2015 and 2016 reports do not work properly. You apparently converted 5,883 worth of receivables to cash, and then issued a dividend of 5,882. And now, your balance sheet is out of balance for 2015. Your assets are 0, your equity is 1, and this cannot be.

If you want a zero net worth account to wrap up the company (and you do), then your journal transactions should have been:

Journal
Debit: Cash: 5,883
Credit: Receivables: 5,883 (converting receivables to cash)
Credit: Cash: 5,883
Debit: Retained Earnings - Dividends Paid: 5,883

Balance Sheet
Assets
Cash: 0
Receivables: 0
Total Assets: 0

Liabilities: 0

Net Worth
Paid Up Capital: 1
Retained Earnings – Prior period: 5,882
Retained Earnings/Dividends paid – Current Period: -5,883
Total Liabilities and Net Worth: 0

And this changes your cash flow statement for 2015. You have that dollar unaccounted for.

Cash Flow
Operating Activities: 0
Cash from Receivables: 5,883
Cash Paid in Dividends: 5,883
Net Increase/Decrease Cash: 0

Now you are in balance and can get rid of that stupid dollar.

In the alternative, you could issue yourself dividends for 5,882 but then you would have to leave $1 in your cash account to balance equity and assets, and then your company is not zeroed out and therefore you cannot wind it up.

Since you have already claimed a 5,882 dividend you can change expenses by a dollar, or revenue by a dollar and get an in balance set of books that way.

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Re: Closing a Pte Ltd

Postby Strong Eagle » Sat, 23 Jul 2016 11:57 pm

As a side note, if I were auditing your financials, I'd find it extremely odd that your administrative expense exactly matched the cash you took in. That's a highly unusual circumstance and would suggest that the admin expense is a cooked up number. But, I doubt anyone would look very closely on a wind up, as long as the financials are in balance, and with the changes I have suggested, they will be.

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Re: Closing a Pte Ltd

Postby furious_88 » Sat, 06 Aug 2016 10:21 am

Hi Strong Eagle, I need your help too. Am trying to close my pte ltd acc. But not sure how to zerorise it. Am using quickbook software.

Can i just do a manual balance sheet and just bring everything to zero?

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Re: Closing a Pte Ltd

Postby Strong Eagle » Sat, 06 Aug 2016 11:06 am

furious_88 wrote:Hi Strong Eagle, I need your help too. Am trying to close my pte ltd acc. But not sure how to zerorise it. Am using quickbook software.

Can i just do a manual balance sheet and just bring everything to zero?


Considering lkh66 couldn't be bothered to reply when I solved his problem, what do you mean by "zeroize"? That's not an accounting term.


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