Contract law backdating detailsview updating newvalues empty
Backdating is dating any document by a date earlier than the one on which the document was originally drawn up.
Under most circumstances, backdating is seen as fraudulent and illegal, although there are some situations in which backdating can be used in a legal and beneficial way, such as backdating a claim for a past period.
Sometimes certain claims (such as insurance claims) can be backdated if the could not be completed at an earlier date, although there must be good reason for neglecting to claim in advance.
If your backdated claim is approved, you will be able to receive benefits from a certain date in the past.
This type of arrangement would not bind third parties, but it may be effective from an accounting and tax perspective depending on the length of time which has elapsed since the intended historic effective date.
Even though the transaction may have already happened in substance, it’s important to find out what the other legal consequences may be, so that steps can be taken to mitigate the risks.
These two general areas mean that some legal due diligence should be carried out to identify and address areas for corrective action.
For example, the selling and buying companies participating in a business transfer may agree between themselves to treat the transaction as if it happened at the previous year end.
This could involve putting in place a business transfer agreement now, which is dated when it is actually signed.
Documenting a transaction which has already happened One possible scenario is that the relevant transaction has already happened, but just hasn’t been documented yet.