There are some compliance requirements that are specific to second and subsequent reports that we sometimes see being overlooked, so we thought that it would be a good idea to remind you of them:
1. Report on progress in the reporting period – focus on what happened in the reporting period. You only need to provide enough information about what has happened in previous reporting periods other than by way of background to put the information provided into context for the creditors. Remember that under SIP 9 you have to provide creditors with sufficient information to enable them to understand what you have done and what you have achieved in the reporting period, so that they can assess whether your remuneration is appropriate and whether or not to exercise their rights to challenge your remuneration.
2. Prepare a receipts and payments account that includes transactions for both the reporting period and the whole of the insolvency to date - the legislation requires you to include a receipts and payments account covering the reporting period with the report, whilst SIP 7 requires that you also provide a receipts and payments account covering the whole of the insolvency to the date to which the report is prepared.
3. Provide details of remuneration and expenses incurred in the reporting period – with second and subsequent reports then reporting on remuneration and expenses becomes more complex. You need to ensure that creditors are told what has been incurred in the current reporting period, together with how much of that remuneration and expenses has actually been paid in the reporting period and what is still outstanding. Similarly you need to make it clear what amounts of remuneration and expenses incurred in previous reporting periods have now been paid and what is still outstanding. This is all required so that creditors are made fully aware what fees and expenses still have to be drawn before there are any monies available to pay them a dividend.
4. Provide a SIP 9 table for the reporting period – where time costs exceed, or are likely to exceed, £10,000 on a case then SIP 9 requires you to provide an analysis of time costs by reference to activity and grade of staff for the time costs incurred in the reporting period. Whilst there is no requirement to provide such information for the whole of the insolvency to date we think that it helps the creditors put the time cost information for the reporting period into context and lets them know what the overall position in the case is, so we recommend that you also produce the cumulative table.
