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CS Executive · Company Law and Practice · Compromise, Arrangement and Amalgamations - Concepts

Gamma Ltd and Delta Ltd are merging. Delta's last annual accounts relate to a financial year that ended eight months before the first meeting summoned to approve the scheme. Which additional document must be circulated for the meeting under section 232(2)?

A supplementary accounting statement must be circulated. Section 232(2)(e) requires it when the last annual accounts of any merging company relate to a financial year ending more than six months before the first meeting. Eight months exceeds that limit, so the requirement applies.

  1. AA supplementary accounting statementCorrect
  2. BA fresh statutory audit report for a new financial year
  3. CA solvency declaration by every director of Gamma only
  4. DA valuation report by the Registrar

Explanation

Section 232(2)(e) requires a supplementary accounting statement if the last annual accounts of any merging company relate to a financial year ending more than six months before the first meeting. Eight months exceeds six, so the statement is needed. A fresh audit report is not what the section requires.

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