Liquidating dividend accounting

Hi, I'm just looking for a bit of guidance regarding the accounting treatment of a liquidation in the holding company under (old) UK GAAP.

The entity was liquidated, resulting in a dividend payable to the holding company comprising the net assets of the subsid (Cr dividend income, Dr interco debtor).

A company will pay liquidating dividends if management believes the market is not valuing the business favorably if it is trying to sell it.

A company could also pay a liquidating dividend if management decides to close voluntarily or if the business goes into bankruptcy and is unable to pay its outstanding debts to its creditors such as its suppliers, employees and the bank. We have over 200 college courses that prepare you to earn credit by exam that is accepted by over 1,500 colleges and universities.

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In the case of bankruptcy, when and how a borrower liquidates assets is a big deal.

If all the debtor's assets are tax-exempt or subject to liens, there may not be any assets to liquidate and hence no money to distribute to creditors.

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