Here’s one of my favourite quotes, which is from Niels Bohr, the Danish physicist and Nobel Prize winner:
“An expert is a person who has found out by his own painful experience all the mistakes that one can make in a very narrow field.”
In the area of corporate simplification projects (which was the subject of a webinar I hosted last Thursday), I certainly wouldn’t admit to all the mistakes I have personally made. But here are some of the mistakes I have “come across”:
- Striking off a company which still owned a shopping centre.
- Failing to deal with pensions issues in relation to a company which was to be removed from a well-known engineering group, and triggering a statutory debt on the transfer of the trade and assets of that company.
- Placing 10 companies into members’ voluntary liquidation without having completed appropriate due diligence checks, and having to apply to court to reverse them out of liquidation (in England this is an “off piste” application which relies on the inherent jurisdiction of the court on matters relating to companies).
I’d like to say there’s a magic formula for avoiding these mistakes, but the most important one I know is to design an appropriate, risk-based process for due diligence and cross-functional sign off, and follow it. And then, for each batch of companies, create a comprehensive steps plan and list of legal documents and actions.
If you’d like to see the slides from last Thursday’s webinar, you can download them here.
FFYI: We’ve just released the dates for our forthcoming webinars up to February next year, on various subjects involving intercompany agreements for Transfer Pricing compliance. You can view the programme, and reserve a place for any which are of interest, here.