Studio PonchioSTP
The new OIC 5: the criteria for liquidation accounts
The accounting standard on liquidation accounts redefines both the measurement criteria and the disclosures. Practical consequences for companies being wound up and for their liquidators.
Accounting standard OIC 5 governs the preparation of accounts during liquidation, when the going concern perspective gives way to one of realisation and settlement of the company’s relationships. The update affects how assets and liabilities are measured and what disclosures must accompany the liquidation documents.
From going concern to liquidation
Once liquidation begins the measurement logic changes: assets are stated at their expected realisable value and a provision for the costs and charges of liquidation must be set up, estimating the net burden expected through to the close of the procedure.
What the officers must do
The opening liquidation accounts, the annual interim accounts and the final accounts mark out the procedure; the liquidators’ report must account for the criteria adopted and for how realisation is progressing. Clear and consistent figures reduce the risk of challenges from shareholders and creditors.
- Accounting standard OIC 5 – Liquidation accounts.
- Arts. 2484 ff. and 2490 of the Italian civil code – dissolution and liquidation of companies.