Newcastle now closed !!!

[idanthyrsus 96]

On 7/24/2022 at 6:38 PM, King Jamie said:

I don't think that's correct.

The last set of accounts prior to the liquidation process kicking in was the year to 30 November 2018. At that point, the net assets were £25,562 but, as the issued ordinary share capital was £100K, the remaining reserves amounted to £(74,438). This is most likely the profit and loss account reserve but no detail of the split is provided, as they're micro-entity accounts (pretty useless in all honesty).

The next thing we know, the company is facing an HMRC liability of £158K, following an investigation of the period prior to Rob Grant taking control. This would have been more than enough to wipe out the £25,562 net assets, even if it consisted wholly of cash / bank (which it probably wasn't, as current assets at 30 November 2018 were only £33,696 and most likely included stock and debtors).

The liquidator issued a Statement of Affairs, showing assets with an apparent market value of just £500. This was cancelled out by a creditor of the same amount. The bottom line of this statement showed net liabilities of just over £258K (£158K to HMRC and £100K ordinary share capital, all owned by Rob Grant).

By the time it came to the liquidator's final report being published (around 8 months later), only a further £2,684.92 of assets had been realised, all of which was swallowed up by professional fees. Both HMRC and the ordinary shareholders received £Nil, as there was nothing left in the pot.

Bottom line is Rob didn't "spend it on something else".

Something looks wrong here.  Ordinary Share Capital is simply the value of the shares that an individual holds - but if the company isn't making any profit, any dividends would be zero in any case - unless that money was used for something other than dividends?  Was this money from the company used to pay George for the sale of the club?  In essence using the club to pay for the purchase, which I personally believe shouldn't be allowed - ask Manchester United or Burnely FC fans about this....

I'd be somewhat surprised if a business account the size of Newcastle Speedway was allowed a bank overdraft of this amount, especially since HMRC are very twitchy about unpaid VAT bills as they are no longer front of the queue with the liquidator.  I haven't seen the liquidators reports - have you got a link please?

So, if VAT had been incorrectly calculated for five years resulting in a £158k short fall, this could have been largely paid by the £100k that was taken out of the club.  Having said that, I don't know who was the recipient of this £100k, but it still stands out like a sore thumb in the company accounts.

Definition of Ordinary Share Capital:

"Ordinary share capital, in relation to a company, means all the company’s issued share capital (however described), other than capital the holders of which have a right to a dividend at a fixed rate but have no other right to share in the company’s profits"

[speed29 19]

Hopefully there will find somewhere new area for Newcastle Diamonds new track in the future???? 

Edited July 30, 2022 by speed29

[enotian 562]

4 hours ago, Winditon said:

You a mackem by any chance ha ha

busted

[King Jamie 356]

1 hour ago, idanthyrsus said:

Something looks wrong here.  Ordinary Share Capital is simply the value of the shares that an individual holds - but if the company isn't making any profit, any dividends would be zero in any case - unless that money was used for something other than dividends?  Was this money from the company used to pay George for the sale of the club?  In essence using the club to pay for the purchase, which I personally believe shouldn't be allowed - ask Manchester United or Burnely FC fans about this....

I'd be somewhat surprised if a business account the size of Newcastle Speedway was allowed a bank overdraft of this amount, especially since HMRC are very twitchy about unpaid VAT bills as they are no longer front of the queue with the liquidator.  I haven't seen the liquidators reports - have you got a link please?

So, if VAT had been incorrectly calculated for five years resulting in a £158k short fall, this could have been largely paid by the £100k that was taken out of the club.  Having said that, I don't know who was the recipient of this £100k, but it still stands out like a sore thumb in the company accounts.

Definition of Ordinary Share Capital:

"Ordinary share capital, in relation to a company, means all the company’s issued share capital (however described), other than capital the holders of which have a right to a dividend at a fixed rate but have no other right to share in the company’s profits"

Ok. I'll try to go through your points in order...

Ordinary share capital is included in the accounts at cost. There were 100,000 £1 ordinary shares issued, hence the £100K shown in the capital and reserves section. Previously, the shares were owned by Andrew Dalby (25K), Martin Phillips (50K) and George English (25K). Before that, Alan Findlay, Joan English, Darryl Illingworth and Barry Wallace all owned various amounts. However, it's best not to get too bogged down in all of that.

The £100K existed at the time of the original shares being issued and paid for (many years ago) and continues to sit in the accounts at that figure for eternity. It doesn't mean that, for example, Rob Grant paid £100K to purchase the shares from the previous 3 owners. A number of company takeovers are for £1, plus the newbie taking on the debts. However, the terms of any takeover will be kept private and most won't be obvious at all from future sets of accounts (especially the toothless micro-entity efforts).

As I stated in my earlier post, the remaining reserves at 30 November 2018 amounted to £(74,438). Presuming this was solely the profit and loss account reserve, it basically means that, throughout the lifetime of the company, it has made £74K more cumulative losses than profits. In these circumstances, no dividends would be legally entitled to be paid (I think you noted that anyway).

Everything was still looking reasonable in the accounts to 30 November 2018. Net assets of £25,562 isn't the worst position to be in. Much better than some other speedway businesses I've looked at over the years.

I'm not entirely sure what you're referring to in relation to a bank overdraft? Basically the accounts information jumped from the November 2018 year to the liquidator's Statement of Affairs dated 2 November 2020. At that point, there was no mention of any bank balance or overdraft. What effectively happened was that the company went from plodding along merrily one day to receiving an invoice (investigation assessment) from HMRC for £158K the next. I suspect Rob would've looked at that and probably either cried very loudly or headed straight to the toilet to check his underwear was still clean.

That £158K was the tipping point which sent the company over the edge. Rob obviously knew he couldn't / wouldn't pay it and so decided to wind things up. The liquidation process was carried out and, as stated, outstanding amounts due were the HMRC debt and the £100K ordinary shares. None of these amounts were settled. There was no "£100K taken out of the club".

I hope that explains things 

Hopefully these links work:

Liquidator Statement of Affairs can be fond here

Liquidator's final report can be found here

 

[Diamondboy 677]

He took the go fund me money and season ticket money. That was part of the “new” company.

[mc131 365]

On 7/29/2022 at 3:14 PM, 1stbendwinkoboy said:

For sure the team fell to bits.  But no-one could have foreseen that Bradley Wilson Dean would have been unable to perform given his record with Peterborough when he was last over here.  He could reasonably have been expected to be a very competent number one.  George Congreve was right up with Dean in NZ but proved to be out of his depth here.  Not really Grant's fault.  Plus Wright, Clegg, Wethers and Starke.  To me it didn't seem to be a table topping team but, frankly, neither did not seem to be a bad team.  A pivotal point, oft forgotten, was the Glasgow farce at Newcastle.  Cammy Brown  should never have been allowed to brow beat the referee regarding a hole in the track that no rider had gone near.  Brown knew we were going to win that one and the negative psychological impact on Newcastle riders was severe when the meeting was lost by default.  A lot of new faces at Brough that night.  But they witnessed faffing about and delays and then lost a third of their entrance money when the meeting was cancelled.  We may never know the whole story.  But continuing the pillorying of Grant will be no help whatsoever as potential buyers will be really alarmed about the vitriol spilling out in this blog.

Wilson Dean was never goin to amount to a no1

[Lefty 1,265]

24 minutes ago, mc131 said:

Wilson Dean was never goin to amount to a no1

Would he have made a solid no. 2? 

[King Jamie 356]

32 minutes ago, Diamondboy said:

He took the go fund me money and season ticket money. That was part of the “new” company.

Was the go fund me money ring-fenced or was it allowed to be used to help with running costs?

The only accounts for the 'new company' (period from incorporation to 30 November 2020) show capital and reserves of £(3,248). The share capital element is £100, so p&l a/c reserve would therefore be £(3,348).

The main creditor is a director's loan account of just under £14K. This is money that Rob has loaned the company in order to keep it afloat. Technically, he is entitled to reclaim this as and when there's money in the bank.

There's an accounting reporting gap between November 2020 and now. I suspect we won't ever see accounts to Nov 2021, although there's no mention of liquidation on Companies House as yet.

If the company was continually racking up bills and the incoming monies were dwindling, the go fund me 'pot' would most likely have been used to help with this. Again, if it was ring-fenced for other purposes, the fans would have every right to be more than upset. If not, then I'm afraid there's not much anyone can do about it.

I await both the Liquidator's Statement of Affairs and the final report with interest. However, unless you believe (or, more to the point, can categorically prove) Rob ran the business into the ground and deliberately incurred expenses he otherwise wouldn't have in normal circumstances, I don't think you can say he "took the go fund me money and season ticket money" as, technically, those funds were provided to help pay the bills. When the money ran out, he then chose to pull the plug. As 100% owner, that's his choice.

By the way, I am in no way a Rob Grant sympathiser. And I fully understand why Newcastle fans are upset. Their team is (it seems) no more. All that history gone, in a flash. Here's hoping for some long overdue positive news, sooner rather than later.

[soupy 556]

2 hours ago, King Jamie said:

Ok. I'll try to go through your points in order...

Ordinary share capital is included in the accounts at cost. There were 100,000 £1 ordinary shares issued, hence the £100K shown in the capital and reserves section. Previously, the shares were owned by Andrew Dalby (25K), Martin Phillips (50K) and George English (25K). Before that, Alan Findlay, Joan English, Darryl Illingworth and Barry Wallace all owned various amounts. However, it's best not to get too bogged down in all of that.

The £100K existed at the time of the original shares being issued and paid for (many years ago) and continues to sit in the accounts at that figure for eternity. It doesn't mean that, for example, Rob Grant paid £100K to purchase the shares from the previous 3 owners. A number of company takeovers are for £1, plus the newbie taking on the debts. However, the terms of any takeover will be kept private and most won't be obvious at all from future sets of accounts (especially the toothless micro-entity efforts).

As I stated in my earlier post, the remaining reserves at 30 November 2018 amounted to £(74,438). Presuming this was solely the profit and loss account reserve, it basically means that, throughout the lifetime of the company, it has made £74K more cumulative losses than profits. In these circumstances, no dividends would be legally entitled to be paid (I think you noted that anyway).

Everything was still looking reasonable in the accounts to 30 November 2018. Net assets of £25,562 isn't the worst position to be in. Much better than some other speedway businesses I've looked at over the years.

I'm not entirely sure what you're referring to in relation to a bank overdraft? Basically the accounts information jumped from the November 2018 year to the liquidator's Statement of Affairs dated 2 November 2020. At that point, there was no mention of any bank balance or overdraft. What effectively happened was that the company went from plodding along merrily one day to receiving an invoice (investigation assessment) from HMRC for £158K the next. I suspect Rob would've looked at that and probably either cried very loudly or headed straight to the toilet to check his underwear was still clean.

That £158K was the tipping point which sent the company over the edge. Rob obviously knew he couldn't / wouldn't pay it and so decided to wind things up. The liquidation process was carried out and, as stated, outstanding amounts due were the HMRC debt and the £100K ordinary shares. None of these amounts were settled. There was no "£100K taken out of the club".

I hope that explains things 

Hopefully these links work:

Liquidator Statement of Affairs can be fond here

Liquidator's final report can be found here

 

What about Richard Juuls money

Edited July 30, 2022 by soupy

[Justgotmecpc 1,059]

9 hours ago, speed29 said:

Hopefully there will find somewhere new area for Newcastle Diamonds new track in the future???? 

If ( as Alan Carr's game show says the price is right )

[Justgotmecpc 1,059]

3 hours ago, soupy said:

What about Richard Juuls money

That's long gone now as I was with Richard last week & I asked him but he told  me granty blew it 

[Justgotmecpc 1,059]

Just now, Justgotmecpc said:

That's long gone now as I was with Richard last week & I asked him but he told  me granty blew it 

Just another person was ready to help & it was refused 

[idanthyrsus 96]

21 hours ago, King Jamie said:

That £158K was the tipping point which sent the company over the edge. Rob obviously knew he couldn't / wouldn't pay it and so decided to wind things up. The liquidation process was carried out and, as stated, outstanding amounts due were the HMRC debt and the £100K ordinary shares. None of these amounts were settled. There was no "£100K taken out of the club".

I hope that explains things 

Hopefully these links work:

Liquidator Statement of Affairs can be fond here

Liquidator's final report can be found here

 

Thanks for that.

The links don't work - but I found them from companies house.  I'm surprised that Rob was allowed to be a company director after the NewSpeed company was effectively declared bankrupt and was unable to fulfill it's creditors.  Obviously passed the directors check, which I'm surprised about.

[Diamondboy 677]

1 hour ago, idanthyrsus said:

Thanks for that.

The links don't work - but I found them from companies house.  I'm surprised that Rob was allowed to be a company director after the NewSpeed company was effectively declared bankrupt and was unable to fulfill it's creditors.  Obviously passed the directors check, which I'm surprised about.

Probably because the problems of NewSpeed were not of his doing. Not trying to be clever but all the history is in this thread, have you read it?

[idanthyrsus 96]

1 hour ago, Diamondboy said:

Probably because the problems of NewSpeed were not of his doing. Not trying to be clever but all the history is in this thread, have you read it?

Yes, I have read it.  The problems were of robs own making.