In force2020 Revised Edition

Contents

Insolvency, Restructuring and Dissolution Act 2018 · 2020 Revised Edition · Part 20 · Bankruptcy Offences

413. Failure to keep proper accounts of business

(1)

A bankrupt shall be guilty of an offence if, having been engaged in any business within 2 years before the making of the bankruptcy application by or against the bankrupt, the bankrupt has not —

(a)

kept proper accounting records throughout that period and throughout any part of the initial period in which the bankrupt was so engaged; or

(b)

preserved all the accounting records which the bankrupt has kept for the periods mentioned in paragraph (a).

(2)

For the purposes of this section, a person is deemed not to have kept proper accounting records if the person has not kept such records as are necessary to show or explain the person’s transactions and financial position in the person’s business, including —

(a)

records containing entries from day to day, in sufficient detail, of all cash paid and received;

(b)

where the business involved dealings in goods, statements of annual stock-takings; and

(c)

except in the case of goods sold by way of retail trade, records of all goods sold and purchased showing the buyers and sellers in sufficient detail to enable the goods and the buyers and sellers to be identified.

(3)

A bankrupt shall not be guilty of an offence under subsection (1) —

(a)

if the bankrupt’s unsecured liabilities at the commencement of the bankruptcy did not exceed $15,000; or

(b)

if the bankrupt proves that in the circumstances in which the bankrupt carried on business the omission was honest and excusable.