© 2009 Grant Thornton. All rights reserved. 4 April 2014 Click the text box to type in Name, Surname etc. To create a new slide choose the ‘new slide’ option in the ribbon at the top. Right click on the slide to choose the relevant layout Before populating this template, you will need to save it under a different name. This ensures you don’t save over your template while populating it. To do this, under File choose ‘Save as’. Rename your presentation to a relevant title, and save it in the correct location. You will then be able to click the save shortcut while creating the rest of the presentation, which will save over your file. SIMPLE CASE: (To fit in 40 minutes) LIQUIDATION OF AMD INVESTMENTS (PRIVATE) LIMITED Dr. R. T. Muza

© 2009 Grant Thornton. All rights reserved. Our history Title and ribbon locked for editing. Therefore only 5 key dates are needed. Dates should be changed depending on historic importance. Click the textboxes to type over. The text here is animated within the slide so we recommend you do not add anymore text boxes in. Introduction Step 1 – Duties and obligations of the provisional liquidator Step 2 – Notices and submission of proof of claim forms Step 3 – First meeting of members and creditors Step 4 – Preparation for second meeting Step 5 – Disposal of assets Step 6 - Preparation of liquidation and distribution account Step 7 - Lodging of accounts with the Master Step 8 - Release of Liquidator Contents

© 2009 Grant Thornton. All rights reserved. Introduction: Simple case The arrow and lines on this page are completely editable. By highlighting the relevant part you are able to change the colour of the lines, animate them or move them around the screen. Some of these are grouped objects – be sure to select the WHOLE group by only highlighting it once rather than double clicking in certain section of that group. If you are struggling to highlight a certain section you can hide the other lines by displaying the selection pane (Found under the Home tab> Select> Selection Pane) and then clicking the eye icon to display/hide parts of the slide. Be sure to remember to display everything before moving on by choosing ‘show all’. AMD was in the business of selling tyres and tubes. At the time of being placed in provisional liquidation, the statement of affairs reflected the following: Total assets – USD (Land and buildings 1,2m; Motor vehicles and Equip 0.3m) Total liabilities – USD (Secured -registered mortgage bond in the sum of USD 0.7m;ZIMRA unpaid PAYE 0.2m;NSSA 0.1m;Salaries 0.6m-8months;trade creditors 3.4m) The lawyer’s cost for the application amounted to USD The 5 th of June 2010 was the return date on the provisional order. The preliminary statement of affairs was submitted to the Master for determining the bond of security that was required. Mr D was appointed as the provisional Liquidator and a certificate of appointment was issued.

© 2009 Grant Thornton. All rights reserved. Step 1-Duties and obligations of Provisional Liquidator The Provisional Liquidator assumed control of the company and took charge of all company assets. Placed the provisional order in short form in the government gazette and Herald. Verified the books and records to ensure that all assets and liabilities are fully accounted for and are complete, accurate and to determine the relevant rights and obligations attaching to such. Opened a bank account with Barclays Bank of Zimbabwe Limited in the name of “AMD Investments (Private) Limited (in liquidation) (AMD)”. Opened books of accounts and other suitable records to enable the liquidator to enter all moneys, goods, books, accounts and other documents to the account of AMD.

© 2009 Grant Thornton. All rights reserved. Step 2 – Notices and submission of proof of claim forms Upon confirmation of the provisional order on the return date a First meeting of members and creditors was set. The meeting was duly advertised in the government gazette ten days before the date of the meeting. Notice of the meeting was circulated to all known creditors and members of AMD.

© 2009 Grant Thornton. All rights reserved. Step 2-continued Proof of claim forms were also send to all known creditors. The provisional order was confirmed on the return date. A notice to all creditors was circulated advising them of the First meeting of Members and creditors. Contents of the notice included: Date; Time; Place; Proxy; Claims to be submitted at least 48 hours before the date of the meeting, i.e. If the meeting is to be held on Wednesday, the proof of claim is to be lodged by Friday of the preceding week.

© 2009 Grant Thornton. All rights reserved. Step 3 – First meeting of members and creditors The first meeting of members and creditors was held. Meeting was chaired by the Assistant Master ; The following business was conducted  Proof of claim forms; and  Election of Liquidator.  In that meeting 5 claims were provisionally accepted by the Assistant Master subject to further verification. The provisional Liquidator was appointed the Final Liquidator.

© 2009 Grant Thornton. All rights reserved. Step 4 – Preparation for second meeting The Liquidator in consultation with Master’s office, advertised in the government Gazette and Herald for the second meeting of members and creditors. All known creditors were advised through registered mail of the meeting. A Liquidator’s report was also circulated before the date of meeting. The Liquidator’s statutory report included amongst others the following: - Amount of Capital issued, subscribed and paid up. - Estimated amount of assets and liabilities - Causes of failure for AMD - Progress and prospects of liquidation

© 2009 Grant Thornton. All rights reserved. Step 5 – Disposal of assets Disposal of assets After the second meeting of creditors, the liquidator disposed of the land and buildings (after consultations with the secured creditor) through Y estate agents and motor vehicles and equipment through Z auctioneers both who are on the Master’s panel. Proceeds realised: - Land and buildings USD Equipment and motor vehicles USD Total proceeds USD and commission and charges amounted to USD Proceeds of USD were banked into AMD’s (under liquidation)Barclays account.

© 2009 Grant Thornton. All rights reserved. Step 6 Preparation of liquidation and distribution account The Liquidator proceeded to prepare the First and final liquidation and distribution accounts for AMD. The contents of the accounts included the following: Encumbered asset account: Costs deducted included the following: Capital gains tax, Estate agent’s commission and selling expenses, portion of bond of security, Master’s fees, Liquidator’s fees and the Secured creditor’s claim was settled. The balance that remained after payment of the secured claim was transferred to the Free Residue Account. Free Residue account: Costs deducted included the following: auctioneer’s commission, Master and Liquidator’s fees, preferent claims for Zimra and NSSA(limited to principal amount) 3months employees salary, legal fees, printing and stationery, telephone costs. The remaining balance was distributed amongst the concurrent creditors which resulted in creditors getting about 20cents in every dollar that was owed.

© 2009 Grant Thornton. All rights reserved. Step 7 Lodging of accounts with the Master The Liquidator before advertising the accounts, lodged them with the Master for audit. The Master upon satisfaction, advised the liquidator to proceed and advertise in the government gazette. A notice was placed in the government gazette - “the accounts will be lying open for inspection for a 14 day period”. The 14 day period lapsed and there were no objections. The accounts were confirmed by the Master and dividends were paid accordingly, as outlined in the distribution account. The Liquidator before paying the dividends placed an advert in the government gazette that dividends were being paid.

© 2009 Grant Thornton. All rights reserved. Step 8 Release of Liquidator As all the assets were realised and creditors were paid accordingly, the Liquidator applied to the Master for his discharge. The Master was satisfied that he had executed his duties well and his bond of security was retired. The release of Liquidator and destruction of records ment Gazette were advertised in the Government Gazette.

© 2009 Grant Thornton. All rights reserved. Thank You Tatenda Siyabonga Zikomo kwambili Asante sana THE END

© 2009 Grant Thornton. All rights reserved. Questions