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Using deposits

  • 31-08-2013 12:53pm
    #1
    mrjoneill
    Registered Users, Registered Users 2 Posts: 536 ✭✭✭


    Are there rules or guidelines on companies or sole traders taking deposits against them using these deposits for the day to day operations of the company or trading firm.


Comments

  • #2
    Gloomtastic!
    Registered Users, Registered Users 2 Posts: 8,826 ✭✭✭Gloomtastic!


    Not as far as I'm aware. Is the deposit refundable if the transaction doesn't go ahead? If yes, then just make sure your cashflow can cover for it.


  • #3
    smcgiff
    Closed Accounts Posts: 5,943 ✭✭✭smcgiff


    mrjoneill wrote: »
    Are there rules or guidelines on companies or sole traders taking deposits against them using these deposits for the day to day operations of the company or trading firm.

    There are specific rules for the likes of solicitors that require the money to go into client accounts. Some (not a lot) get into trouble for using this money.

    I'm guessing you're not a solicitor or the like :)

    If the deposit is refundable it would be best not to use it or you could risk being accused of reckless trading if you could not refund the monies. Probably unlikely.


  • #4
    mrjoneill
    Registered Users, Registered Users 2 Posts: 536 ✭✭✭mrjoneill


    If the deposit is refundable it would be best not to use it or you could risk being accused of reckless trading if you could not refund the monies.

    Are there regulations on this or accountancy practice rules on this?

    I’m looking for information regard a company going belly up after taking deposits for a period to keep it afloat where there is an unlikelihood it could provide service to the depositers.


  • #5
    Graham
    Moderators, Society & Culture Moderators Posts: 17,643 Mod ✭✭✭✭Graham


    I'd imagine that's more covered by trading while insolvent.


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