Calculation of net assets to determine the existence of grounds for dissolution of a company

Royal Decree-Law 20/2022, of 27 December, has approved an extension to the so-called accounting moratorium approved in 2020 due to the pandemic with respect to the losses of the financial years 2020 and 2021, concluding that they will not be taken into account to determine whether the cause for dissolution of a company due to losses exists.

Specifically, it is established that “for the sole purpose of determining the existence of the cause for dissolution provided for in article 363.1.e) of the revised text of the Capital Companies Act, approved by Royal Legislative Decree 1/2010, of 2 July, the losses of the financial years 2020 and 2021 will not be taken into consideration until the close of the financial year beginning in 2024”.

As directors of a company, at the closing, we must pay attention to the current insolvency situation of the company, which requires, unless there is a pre-insolvency procedure, the filing of the insolvency proceedings within a period of two months.

The Capital Companies Act indicates that, if the assets of a company are less than 2/3 of the share capital, it will have one year to resolve this imbalance; in the case of an S.A., if it is less than ½ of the share capital, both S.L. and S.A. must call a general meeting to adopt the corresponding corporate resolution, either dissolution or adopt the corresponding measures to resolve the asset imbalance.

With the onset of the pandemic, these obligations that weighed on the administrators were suspended by means of the bankruptcy moratorium and the accounting moratorium.

The insolvency moratorium meant the suspension of the obligation to file for insolvency proceedings within two months from the manifestation of the current insolvency situation and, after successive extensions, it was finally extended until 30 June 2022.

Since that date, there is no longer a moratorium on insolvency proceedings and there have been no changes in this respect at the end of the financial year.

The accounting moratorium by Royal Decree-Law 20/2022 has been extended again until the financial year 2024, and the losses of the financial years 2020 and 2021 should not be taken into account for the calculation of the net assets used in the calculation of the grounds for dissolution of a company.

However, we recommend that special attention be paid to this calculation, as the current situation of inflation, rising interest rates and uncertainties may lead to losses in the current financial year, which should be taken into account in the calculation of equity.

We remind you that there are alternatives such as participating loans, capital increases to offset credits, accordion operations, etc. that can help in the event of a company’s equity imbalance.