SPECIAL ACCOUNTING RULES FOR JUDICIAL ADMINISTRATORS AND JUDICIAL MANAGERS FOR THE LIQUIDATION OF COMPANIES
I. – Definition of accounting books
Under the terms of the articles 59 and 60 du décret n° 85-1389 du 27 décembre 1985, la comptabilité spéciale des administrateurs judiciaires et des mandataires judiciaires à la liquidation des entreprises comprend les éléments suivants:
– a centralising register of mandates received;
– a journal book;
– auxiliary journals;
– a general ledger;
– auxiliary ledgers of individual accounts opened for each mandate;
– a collection of periodic statements;
– receipts for cash payments.
The special accounts must enable the quarterly statements referred to in Article 63 of the Decree to be drawn up.
An accounting period corresponds to a calendar quarter.
1. 1. The directory of mandates.
The general directory records and centralises all mandates and assignments received, whether amicable or judicial.
Warrants and assignments received must be entered in chronological order of appointment.
From the general directory, sub-directories by type of warrant or by jurisdiction can be established.
Attendments or assignments received before the entry into force of décret n° 98-1232 du 29 décembre 1998 may also be the subject of one or more specific sub-directories.
There must be continuity in the numbering of the general directory, regardless of the mandate or assignment received.
The directory records each new mandate or assignment under a separate number, even if the same person or assets were the subject of another mandate or assignment previously mentioned.
Related to the same file, two assignments, whether successive or concurrent, are considered to be distinct, each of which must be given its own serial number in the general register, since they must be the subject of separate rendering of accounts.
Any final rendering of accounts in respect of a given mandate or assignment entails the obligation to mention the end of the mandate or assignment in the directory.
1. 2. The journal book.
A journal is a statement showing all accounting transactions in chronological order.
The journal book transcribes or centralises entries from the subsidiary journals. The recapitulation in the journal book includes the masses and not the balances. Centralisation can only be carried out on the condition that all documents are kept enabling these transactions to be verified on a day-by-day basis.
Auxiliary journal transactions are transcribed or centralised at least once a month in the journal book.
The centralisation entries must state:
– the monthly period concerned;
– the reference of the original journals;
– the totals for the period, in debit, credit and balance.
1. 3. Auxiliary journals.
Auxiliary journals record all accounting transactions for mandates or assignments, transaction by transaction, and in chronological order.
One auxiliary journal is opened for each bank account used.
A miscellaneous transactions auxiliary journal may be opened for account-to-account transfers or regularisation transactions.
A statement of bills, securities and valuables must be kept.
A cash journal is opened for all cash transactions.
Auxiliary journals must be published regularly, and at least once a month.
The totals of the auxiliary journals must be transferred to the journal book at least once a month.
1. 4. The general ledger.
The general ledger is used to monitor the accounts for each mandate or assignment and records movements in the individual accounts.
The professional opens an individual account for each mandate or engagement giving rise to a movement of funds.
The general ledger includes all individual accounts.
It serves as the basis for drawing up quarterly statements.
The general ledger may be divided into several subsidiary ledgers, with regard to the maintenance of sub-directories.
The journal book and the general ledger classify the same set of entries in an order specific to each.
Every entry made in the daybook or subsidiary journals also appears in the individual accounts.
The movement and balance totals in the daybook are equal to the totals in the general ledger.
1. 5. Subsidiary ledgers.
They are made up of the individual accounts opened for each mandate or assignment.
Each sub-directory has an associated auxiliary ledger.
All the auxiliary ledgers together make up the general ledger.
Each month the transactions in the subsidiary ledgers are centralised in the general ledger.
The provisions concerning entries made on the subsidiary ledgers are the same as those applicable to the daybook or subsidiary journals.
An individual account may only be removed from the ledger if it has a zero balance and if the rendering of accounts was filed during the previous quarter.
This removal cannot be made without a prior edition of all entries made to this account.
Any individual account, even if archived, must be able to be presented on paper within the statutory limitation periods.
At the end of each quarter, the subsidiary ledgers must be published with a total of the quarter’s transactions for all accounts, in debit and credit, both in accumulations and balances.
1. 6. Periodic statements.
1. 6. 1. Quarterly statements.
Quarterly statements must mention, in accordance with Article 63 of Decree no. 85-1389 of 27 December 1985, for all mandates or assignments for which accounts have not been rendered before the end of the previous quarter:
– the number of the case in the repertoire;
– the name of the case;
– the name of the mandating court or the capacity of the mandator;
– the date of the appointment decision;
– the nature of the mandate or assignment;
– the accounting movements recorded for the case since the origin;
– the movements and balance per account opened at the Caisse des dépôts et consignations and other financial institutions;
– all funds, bills, securities or valuables belonging to others;
– the cash available in the hands of the professional;
– the interest produced by a global interest-bearing account for the benefit of each company (art. 68-1 du décret n° 98-1232 du 29 décembre 1998).
Quarterly statements must be kept for ten years.
If the court-appointed administrator or the judicial representative for the liquidation of companies maintains several sub-directories, it must provide a quarterly statement per sub-directory, with a centralising statement of auxiliary journals (General Ledger closed on a quarterly basis).
The case number in the directory that must appear on these quarterly statements corresponds to the order number in the general directory.
The set of statements drawn up in respect of each quarter is made up of all the individual accounts of all the mandates in progress and which have not been the subject of a rendering of accounts before the end of the previous quarter.
The accounting movements recorded for the case since inception correspond to the cumulative total of all movements since the file was opened. In the event of a change of software, the new programme must be able to include at least the accumulations, mandate by mandate, and not the balances, of the transactions recorded prior to the transfer, if not all of the said transactions.
All funds, bills, securities or assets belonging to others are the funds, bills, securities or assets held by the professional and not yet accounted for in the treasury journals.
Bills of exchange, securities or other assets are normally valued on the basis of their acquisition value. Their amount per mandate or assignment appears on a special line in the quarterly statements.
When a court-appointed administrator or a judicial representative for the liquidation of companies deposits funds at the Caisse des dépôts et consignations in a remunerated global account, he shall show once a quarter and at the end of his assignment, in the special accounts and on the quarterly statements, under a separate line, and in respect of each mandate or assignment, the accumulated interest earned and booked.
Interest is allocated to each mandate or assignment in proportion to the average balances as they appear in the special accounts.
Accounting movements for transactions occurring after the end of a mission are recorded in a special liaison account.
A liaison account file grouping the entries relating to these transactions is opened for this purpose and appears on the quarterly statement under the same provision as any other mandate.
Emoluments received after the completion of a mandate that is no longer mentioned on the quarterly statement must be transited in entries via the liaison account folder.
1. 6. 2. control statements.
The total of the amounts shown on the various quarterly statements drawn up on the same date must be summarised on a summary statement which must show the overall balance of all outstanding mandates.
This balance must correspond to the total of the cash account balances after reconciliation.
1. 7. Receipt books for cash remittances.
These receipts must be numbered and dated. They must include the provisions set out in l’article 65 du décret n° 85-1389 du 27 décembre 1985.
Funds received in cash must be deposited immediately in the bank, failing which a cash journal must be opened and kept on a daily basis. No cash payments shall be made without passing through a financial institution.
The entries recording these transactions shall mention the number of the receipts.
2. 1. Characteristics of the entry.
Each entry includes:
– the name of the case;
– the date of the transaction;
– the number of the entry (carried on the voucher);
– the wording of the transaction with the name of the issuer of the revenue or the beneficiary of the payment;
– the amount of the transaction;
– an indication of the journal concerned.
2. 2. Entering entries.
Each accounting entry must be recorded simultaneously in the individual mandate account and in an auxiliary journal.
Each accounting entry must be supported by a supporting document consisting of a written document which must be duly referenced.
Each accounting entry shall include the number of the individual account moved, in correspondence with the directory number.
The wording of the entry must enable the transaction to be clearly identified.
The accounting and IT organisation of the study must enable the corresponding supporting documents to be quickly found from the indications in the auxiliary journals or individual accounts.
Accounts are kept on a day-to-day basis.
Accounting movements are recorded chronologically.
Cash transactions are in principle recorded when the payment is issued or when the payment voucher is deposited in the bank and reconciliation statements are issued regularly, at least once a month, by comparison with bank balances.
The reconciliation of bank statements must be carried out daily or at each statement, unless it can be shown that it is impossible to do so.
The accounting system and software used must be capable of enabling these reconciliation statements to be drawn up at any time.
2. 3. editions.
Centralising accounting statements must be edited regularly and at least once per accounting period.
The individual accounts for each mandate must be available for consultation on paper or on screen at any time.
The documents edited must include, for each entry, the information referred to in 2. 1.
It must always be possible to edit an account on request.
2. 4. The validity of accounting entries.
The keeping of accounting records must not show any blanks or alterations of any kind.
Electronically entered entries do not form part of the accounting system until they have been validated.
Thus, any input sequence must in principle be output in the form of an input draft, which constitutes a control report.
Validation of the entries entered consists of freezing the various elements of the entry referred to in 2. 1 in such a way that any subsequent modification of any of its elements is impossible.
No entry may be deleted. A cancellation may only be made after validation by reversing an amending entry.
Validation must take place before the close of each accounting period.
The accounts must be kept in the French language.
From 1 January 1999, accounting documents may be drawn up in euros. This choice is irrevocable. Conversion and rounding rules must be respected.
3. 1. Reminder of the rules.
Two national currencies participating in the euro cannot be converted directly between each other.
Example: the conversion from francs to florins must be established first from francs to euros, then from euros to florins.
A national currency participating in the euro cannot be converted directly into a currency outside the euro zone.
Example: the conversion from francs to dollars must be made first from francs to euros, then from euros to dollars.
The conversion rate from euro to ex-national currency must have six significant digits, i.e. five digits after the decimal point for the French franc (in the case of the Irish pound, six digits after the decimal point must be taken into account, since this currency has a higher unit value than the euro).
It is compulsory to use three digits after the decimal point and to round up to the higher cent when the third decimal is greater than or equal to 5, to the lower cent if the third decimal is less than 5.
The Community regulation prohibits the use of the inverse rate, which requires a division to be carried out instead of a multiplication.
3. 2. Treatment of discrepancies.
Differences may occur between the initial sum and the sum reconverted into francs in a franc-euro-franc transaction. They may not exceed 3 centimes.It is up to the financial institution to deal with this problem.
Differences may arise between an addition of values converted individually into euros and the total converted into euros (this is the example of the remittance of several cheques issued in euros and converted in the accounts into francs, with the bank crediting the total remittance to the account).
This difference needs to be recognised and included in the adjustment of accounts within the study’s special accounts. This difference will have to be allocated to one of the individual accounts moved.
3. 3. Conversion of historical data.
When the accounting system is changed over to euros, by 1 January 2002 at the latest, the historical accounts must be converted into euros, observing the rounding rules for each transaction concerned.
The overall rounding resulting from these conversions must be individualised in a specific account.
