Declaration of solvency, Business Law and Ethics

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DECLARATION OF SOLVENCY:

                                      A voluntary winding up is a members' voluntary winding up only if the directors make and deliver to the registrar a declaration of solvency:

This is a statutory declaration that the directors have made a full inquiry into the affairs of the company and are of the opinion that it will be able to pay its debts in full within a specified period, not exceeding 12 months.

The declaration is made by all the directors or, if there are more than two directors, by a majority of them.

The declaration includes a statement of the company's assets and liabilities as at the latest practicable date before the declaration is made.

The declaration must be:

(a) made within the thirty days immediately preceding the date of the passing of the resolution for winding up, and

(b) delivered to the registrar for registration before that date: s.276(2)

If the liquidator later concludes that the company will be unable to pay its debts he shall further notify the registrar accordingly and call a meeting of creditors and lay before them a statement of assets and liabilities: s.281(1)


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