Welcome
Welcome to the Sixth Edition of our e-bulletin. Please take time to read this bulletin and bring it to the attention of any relevant individuals within your organisation.
We would appreciate your feedback so that we can gauge the bulletin's effectiveness and incorporate improvements in future editions. If there are specific subjects that you would like us to cover, then please email your suggestions to The Editor.
We hope that the guidance provided will prove to be a valuable reference tool.
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Rosemary Winter-Scott
Rosemary Winter-Scott joined AiB on 1 October 2009, taking on her official role as The Accountant in Bankruptcy and Agency Chief Executive.
Before this, Rosemary spent the preceding month meeting with and learning from a variety of staff and stakeholders to better understand and prepare for her new role.
There is no underestimating that Rosemary joins at an important time in AiB's history.
The last two years in particular have brought our work into focus and cemented the contribution that our services bring, not just to individuals, but to getting the economy back on its feet.
Acknowledging the work ahead for Mrs Winter-Scott and the Agency, Minister for Community Safety Fergus Ewing said:
"This is an important role, particularly during these difficult economic times.
"There are families and businesses in Scotland facing the very real prospect of bankruptcy for the first time, and we want to do everything we possibly can to help them.
"As a Government, we are responding decisively to support them, taking wide-ranging action through ongoing investment in our economic recovery plan, helping businesses, whilst targeting action to aid hard-pressed households.
"We will continue to work with our partners such as AiB to help achieve our priorities, giving help and support to those facing difficult challenges brought about by the global recession.
"The skills and experience Mrs Winter-Scott brings with her will be a great asset."
With the breadth of policy work underway; including the Debt and Family Homes Bill, the Debtor Protection Bill, and consultation on the Debt Arrangement Scheme (DAS), and operationally; the refinement and tweaking of internal processes to streamline services, Rosemary is more than conscious of the Agency's commitment to Ministers to find simple and effective solutions that deal with debt problems head-on.
Mrs Winter-Scott said:
"I join the Agency at an important time given the current economic situation. With plans underway to bring greater protection to both businesses and individuals facing the prospect of bankruptcy, the expertise and commitment of my staff have come to the fore.
"It goes without saying that there are challenges ahead but ones that I am keen to tackle head on."
"The month learning about the work of AiB has been invaluable. I have been exceptionally impressed by all the hard work that has gone before and the huge achievements of Gillian Thompson and the staff of AiB."
"Together, with the important contribution of insolvency practitioners and money advisors, I am confident we can provide the best service possible to the people of Scotland."
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Agents' Up-Front/Advance Payments
Agents should note that if they have incurred outlays or are due a fee in excess of £500 outwith an account period, they can request an up-front payment. An Annex G and K1 should be submitted, clearly noted as an up-front payment. If the request is for a fee based on funds, contributions, heritage or a moveable asset, you must ensure that either the monies have been sent to AiB, or you are in receipt of the said funds.
If your request is based on heritage, you must supply a state for settlement along with the Annex G and K1. If based on a moveable asset, you must supply any accompanying documentation.
A determination will not be issued in these circumstances. Payment will be made through the BACS system and the account will not be returned. In cases where the end date of the accounting period is due or has passed, the end date will be extended by three months after the K1 is processed.
You must ensure that any payments made to you are included in the next account to be audited and that you show a deduction of payments already received by you.
Calculating or Estimating Costs - Scheme of Division, Recall or Composition
Please note changes when calculating and submitting a Scheme of Division or giving estimates for Recall or Composition.
- The Agent basic fee, all fees paid to the Agent in respect of heritage and moveable assets, contributions or ingathered funds and also K3 hours are now fully recoverable (net of VAT).
These changes to procedure have been implemented in accordance with The Bankruptcy Fees (Scotland) Amendment Regulations 2009.
Realisation of Heritable Property on Annex G
Agents should note that on sale of heritable property the Annex G should be completed with details relevant to the debtor only. For example, if heritable property is realised for £90,000 but is divided between 2 parties the realisation figure should be the actual amount realised for the case e.g. £45,000. Similarly, the actual amount per case of the expenses of realisation and amount due to secured creditors should be entered.
If you have any queries regarding the above please contact us.
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Amended Accounts
Pencil amendments are made to Receipts and Payments where the account does not correspond with the previous account submitted. When determining an account the auditor checks the entries shown through the previous account against the current account and identifies any discrepancies. The account is then amended to reflect our findings, if you disagree with these amendments it would be helpful if you advised us of this either in your reply to audit observations raised or with the next account submitted instead of simply overlooking the amendments. We are happy to discuss any amendments made.
Trust Deed Protection Paperwork
Trust Deeds should not be submitted to the Accountant in Bankruptcy prior to the 5 week expiry period of the date advertised in the Edinburgh Gazette. This would reduce time and resources for both the Trustee's and Accountant's staff as the Trust Deed cannot be protected until the 5 week period has expired.
Protected Trust Deed Registration Fee
Trustees are advised that the "Notes for Guidance under Protected Trust Deeds" will be amended to confirm that the Registration Fee should be paid when Trustees receive an invoice.
If you have any queries regarding the above please contact us.
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Supervision Team
Determination Circulars
Queries have recently been received regarding the issue of determination circulars when remuneration has either been fixed at nil or deferred. Please note that the Bankruptcy Acts, S53 (3) confirms that the determination should be made available to interested parties and does not differentiate between amounts determined. Therefore a determination should be circularised in all circumstances as the creditors and debtor need to be informed that an account has been determined and of their right of appeal.
If you have any queries regarding the above please contact us.
New Creditor Petition Fee
With effect from 1 October 2009, all creditors who petition to make an individual bankrupt in a Scottish Court must pay an administration fee of £100 to Accountant in Bankruptcy (AiB).
- The new fee has been introduced in accordance with the Scottish Government's drive for sustainable public services, as part of a raft of measures to decrease its reliance on core Scottish Government funding and the public purse.
- The new fee will cover AiB's administration costs for processing and recording creditor petitions and undertaking checks to prevent duplication of petitions and applications for bankruptcy.
- Creditors must send a copy of their petition for bankruptcy to the Accountant in Bankruptcy on the day they lodge their petition in the Scottish Court Service. On receipt of the copy of the petition, we will issue an invoice to the petitioning creditor, for the £100 fee.
- If a third party completes and submits a petition on behalf of a creditor, they can request that we send them the invoice for payment of the new creditor's petition fee.
- This fee is only payable on creditor petitions. It is not payable by a Trustee when they petition for bankruptcy following the failure of a PTD.
- The Creditor Petition Fee was introduced in Part II, Regulation 6.2 of The Bankruptcy Fees (Scotland) Amendment Regulations 2009, which came into force on 1 April 2009.
Further information on this fee can be obtained from our website:
http://www.aib.gov.uk/MainNav/Services/Legislation/accesstobankruptcy/
Creditorsapplication/creditorpetitionfee
If you have any queries regarding the above please contact us.
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We hope our e-newsletter has been both informative and useful to you.
Remember, if you would like anyone else from your organisation to be included in our mailing list please let us know. We would also welcome any feedback or ideas for future topics. Feel free to contact us with your suggestions.
Look out for our newsletter next quarter!
Best Wishes
AiB Accounts and Case Admin Team
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- The Accountant's Information Bulletin is produced by the Accounts and Supervision Teams, Case Operation Branch, AiB, for the benefit of Agents and Trustees working with the Agency. All information presented here was true and accurate at the time of publication.