Changing purpose of a Ltd Co

[CoombeI]

Hi all. A client has asked whether there are any accounting implications of changing the purpose of their Ltd Co. i.e. the company currently exists as a certain type of shop, but they intend to start trading in completely different products (in addition to the original purpose, rather than replacing it) in the near future.

Aside from perhaps reflecting this at Companies House, I can't think of any other implications from an accounting perspective and Internet searches haven't yielded anything useful.

Appreciate any thoughts or experiences anyone may have. Many thanks.

 

[billmccallum1957]

The articles & memorandum for the company should identify the objects, most standard formats allow a company to enter into any business that it wants. So check there first.

 

[billmccallum1957]

for example....


DIRECTORS

DIRECTORS’ POWERS AND RESPONSIBILITIES


Directors’ general authority


3. Subject to the articles, the directors are responsible for the management of the company’s business, for which purpose they may exercise all the powers of the company.


Shareholders’ reserve power


4.—(1) The shareholders may, by special resolution, direct the directors to take, or refrain from taking, specified action.

(2) No such special resolution invalidates anything which the directors have done before the passing of the resolution.