Director of Kymo Holdings Limited, Lancashire Nursing & Residential Homes Limited and Carecroft Limited, Kyle Goldsmith, has been disqualified for seven years. According to an investigation by the Insolvency Service, Goldsmith had failed to keep sufficient records of the books and accounts.
All three companies went into liquidation between 2011 and 2012, during which time Goldsmith provided only a small amount of records and information to the liquidators. This meant they were unable to know the full extent of the companies’ assets and liabilities.
Head of Insolvent Investigations North, Robert Clarke, said “Directors have a clear, statutory duty to ensure that their companies maintain proper accounting records, and, following insolvency, deliver them to the office-holder in the interests of fairness and transparency”.
“Without a full account of transactions it is impossible to determine whether a director has discharged his duties properly, or is using a lack of documentation as a cloak for impropriety.”
This should be yet another warning to directors to understand their duties in the event of insolvency. If it is proven directors have acted wrongfully, they can be made personally liable and, like above, disqualified depending on the severity of the situation.