Page 15 - GOING CONCERN AND RELATED ISSUES

GOING CONCERN AND RELATED ISSUES

Trading whilst Insolvent (continued...)

Companies Act

1. Reckless of fraudulent trading:

• Section 22(1)

• Consequences of breaching s22

 s77(3) of the Act

 S214 of the Act

2. Financially distressed companies:

• s128(1)(f)- it appears to be reasonably unlikely that the

company will be able to pay all its debts as they become due
and payable within the immediately ensuing six months; or

• It appears to be reasonably likely that the company will
become insolvent within the immediately ensuring six

months

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