We understand that the RPBs have recently agreed that the draft final progress reports issued prior to final meetings need not be the final progress report and can include future transactions that will take place prior to the final meetings. This is not what the rules appear to say, but we think that the construction of the rules has resulted in unintended consequences and we welcome the pragmatic approach being taken by the regulators.
One way to show such transactions is to have three columns in the receipts and payments account – the first showing transactions since the date of the last progress report (or commencement if an annual progress report has not been issued), the next showing anticipated future transactions to the date of the final meetings, and the third showing total transactions for the whole of the liquidation.
Another way that could be acceptable is to show the future transactions below the account or in a note.
The approach of anticipating future transactions should be used sparingly though, as you would need to issue a revised final report if the actual transactions were materially different from those that were anticipated. As a result, we would only recommend taking such an approach where you are almost able to close the case as at the anniversary date, want to avoid having to issue an annual progress report and only have a few remaining transactions to process that are certain (e.g. VAT refund for a known value, advertising costs that are on a standard rate).
Ideally, you should still be looking to have undertaken all transactions and reduce the estate account balance to £nil before issuing the final progress report, particularly in compulsory liquidations and bankruptcies where any future realisations will have to be paid into the ISA and as a result will attract fees. Taking such an approach also helps ensure that you do not inadvertently draw additional remuneration without making disclosure to creditors.
