business accounting question

[Dan]

I have a business legal situation that I am wondering about. My
parents are in a family business that is registered as an S
corporation. There are multiple families where the ownership is
divided. One of the families was caught stealing funds from the company
on mupltiple occasions. They currently are no longer working for the
company and get paid a good salary for sitting at home. Since the
person has been gone profits of the small company have risen
tremendously. At the end of the year the net income is divided and
distrubted accordingly. The family that stole obviously receives less
money since they are no longer working at the company. I am wondering
from a legal perspective what the laws are pertaining to this matter. I
see that my parents are stressed out about this matter because the
family that stole is currently looking to receive more money out of the
net income. The two families that work at the company now are the
reason why the company is still in business and doing better than ever.
Shouldn't they be rewarded for this? It is a very tricky situation but
I am just wondering about any input.

[Chris Gunn]

Post by Dan
I have a business legal situation that I am wondering about. My
parents are in a family business that is registered as an S
corporation. There are multiple families where the ownership is
divided. One of the families was caught stealing funds from the company
on mupltiple occasions. They currently are no longer working for the
company and get paid a good salary for sitting at home.

Howdy Dan,

This is a situation that should have been taken care of when the
embezzlement was first discovered. It's a puzzle as to why it was not
turned over for criminal investigation and prosecution.

Post by Dan
The two families that work at the company now are the
reason why the company is still in business and doing better than ever.
Shouldn't they be rewarded for this? It is a very tricky situation but
I am just wondering about any input.

Seems like a simple solution to me. The two families should set up a new
corporation and let the old one expire. I assume the corporation itself did
not own more than some equipment. That can be sold to the new corp. If
there are leases involved, move them to the new corporation.

Bottom line: It should be discussed at length with a qualified and
knowledgeable attorney. Pick the attorney carefully and check his
references. Get a free consulation with five or six of them and listen
carefully to how they present themselves.

Thanks, Chris www.bizynet.com and www.bizycart.com
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