Backdating business history
From a legal perspective, the business sale agreement could potentially be signed in June, and the agreement may specify an immediate completion date (i.e.
the date when legal ownership of the assets actually passes).
Assess how the employee was notified of the assignment (i.e., was the employee given specific information in writing?
), their eligibility, duties, and effective date for compliance with applicable laws, rules, and labor agreements.
For example, an intra group transfer of business and assets may have been intended to take place on 31 March but could not take place then because regulatory approvals were not yet in place.
All backdated transactions must adhere to criteria outlined in this section.It is helpful if the recitals to the agreements describe the history of what actually happened, when it happened and what evidence of this exists. when actually signed), but can refer to the historic transaction date.– in some cases specific legal formalities may need to be complied with in order to perfect the transaction.Backdating requires a justification for the correction (e.g., promotional appointments require substantiating the employee performed duties at the higher level as of the retroactive effective date).
Reasons for backdating transactions may include: It is the policy of the Department of General Services' (DGS) Office of Human Resources (OHR) to authorize backdated appointments and/or make corrections to an individual’s employment history.
As mentioned above, it is a matter of accounting practice as to whether the transaction can properly be accounted for as taking place on 31 March.