One of my client's (company) factory was burnt due to fire on 31.08.2010. Company has huge term loan and cash credit from nationalized banks. Company was also running through financial crises hence banks has took the possession of factory premises , land, plant and machinery.Now I want to prepare the Director's report and notes to account. Now company is no more going concern.
Require the help in following points? 1. What should be the note for going concern in Directors report as well in notes to account?
2.Notes on directors personal liability towards repayment of term loan?
Personal liability of director is dependent on the terms of Loan agreement. Generally they are not personally liable for this loan but everything is dependent on the language of loan agreement.
Simply prepare a note like you prepared in your quety regarding fire etc and put it in the Directors report. For notes to accounts prepare a note regarding financial liability of the company. While drafting keep this in mind that notes to accounts are just an explanation to the financial figures used in balance sheet and in profit and loss account.
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