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Business Insolvency Advice

Under current legislation a company is deemed to be trading insolvent if:

  1. the value of its debts / liabilities are greater than the value of its assets
  2. that the company cannot pay its debts as and when they fall due

If you agree with your client that their business is trading insolvent then they have a legal responsibility to address the situation immediately. We strongly recommend they contact Business Rescue Centre for business insolvency advice in this situtation. We can help resolve disputes with creditors before it gets to the stage of compulsory liquidation (winding up by the court) or put a business rescue / restructuring plan in place to prevent any further action being taken and ultimately to protect your client and their business interests.

Creditor’s Voluntary Liquidation (CVL)
This is designed to make the liquidation process as pleasant as it possibly can be and is instructed by the Director’s and shareholders of a company. The principle benefits of a CVL is to reduce the risk of implications such as Directors disqualifications or personal liability.  Many Director’s do not realise that once a company goes into Liquidation limited liability can diminish.
By instructing Business Rescue Centre we will offer you valuable advice in the event that your company needs to enter into liquidation along with continued support of how you can still earn a livelihood without committing any offences.

By having a good working relationship with your liquidator, it really does make a difference and your client will be safe in the knowledge that they will have professional guidance throughout the process. Business Rescue Centre will look after their best interests by providing professional, transparent advice at all times and making sure no boundaries are crossed causing potential further implications.

Compulsory Liquidation
This is an insolvency procedure that is started by a creditor when a company cannot pay its debts. It is normally a last resort after all other debt collection procedures have failed and the creditor feels they have no alternative but to issue a winding up order. The company is then forced into Liquidation which results in the complete closure of the business.

It is therefore advisable to try and resolve any disputes over debts with creditors before it gets to this stage as the effects of Compulsory Liquidation can be severe. The process is also very unpleasant for your client whilst the Official Receiver goes through the company’s affairs and will also examine the Directors and their conduct.

If your client finds themselves in this situation there are alternatives however, time is often of the essence therefore we strongly advise your client speaks with a Partner at Business Rescue Centre immediately for further advice.

Administrative Receivership
This is instructed by the holder of a fixed or floating charge (usually a bank or other secured creditor) when a business breaches the terms of borrowing. They may appoint an administrative receiver (who must be a licensed Insolvency Practitioner) to recover the money it is owed. The administrative receiver effectively takes over the management of the business prior to selling the business and its assets. The Company is said to be ‘in receivership’ and the court is not normally involved.
So if your client has noticed warning signs such as these:

  1. The bank manager has talked to them about reducing facilities
  2. The bank have sent an independent accountant to their business for an audit

... we recommend they talk to Business Rescue Centre immediately as a bank can appoint receivers without prior warning and therefore your client would loose complete control of their business. We can help protect their business and put a restructuring plan in place whilst keeping the bank at arm's length.

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Business Rescue Centre Ltd
The Maylands Business Centre
Redbourn Road, Hemel Hempstead
Herts, HP2 7ES

Tel: 01442 233123

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