Business recovery and insolvency
If your company or business is starting to run into difficulties, early advice can result in problems being avoided or resolved without resorting to liquidation, or having to stop trading.
Business Turnaround and Cash Flow Problems
Cash flow is the life blood of any business. If you are experiencing problems controlling debtors and paying bills when they become due, then you should consider talking to our turnaround team.
They can give you guidance on how to reduce debtor days and improve your cash flow situation.
They can also negotiate with your creditors and the bank. Seeking early advice can often turn an ailing business into a successful one.
Investigations and Monitoring
Critchleys' experienced business recovery team will prepare reports and recommendations for investors, bankers and directors. They will also undertake viability studies and provide monitoring services to banks and other lenders.
Our practitioners and staff are experienced in the provision of investigatory services to creditors via liquidation procedures in order to advise on the dissipation of assets and the possibility of recovery for the benefit of creditors.
Corporate Voluntary Arrangements
A CVA is a contract between a company and its creditors which is administered by an Insolvency Practitioner. A CVA affords a company the flexibility to trade unencumbered by the restrictions of Administration or Liquidation. A CVA requires a firm commitment to continue to trade coupled with a supportive group of creditors and a viable business model.
The Enterprise 2002 Act introduced a more streamlined and user-friendly process where it is possible to reconstruct a business through an administration order. This may involve raising new capital, or arranging loan facilities which aim to return the company to profitable trading.
These are being phased out as legislation introduced in The Enterprise Act 2002 takes effect. They have been abolished except in certain very limited circumstances.
A member of the Insolvency team can be appointed to represent you or your clients at creditors' meetings. They will provide a prompt and objective report upon the meeting and its outcome.
Creditors' Voluntary Liquidations
Directors of insolvent companies should seek advice immediately. Failure to act in a proper manner can result in breaches of the Insolvency Act and involve the directors in personal liability for company debts.
A member of the Insolvency team can offer the best advice on actions to be taken before the appointment of a liquidator. They can also accept the shareholders' nomination as liquidator.
Members' Voluntary Liquidations
When a solvent company wishes to cease trading, the directors can arrange to put the company into liquidation and distribute the assets to shareholders.
Where appropriate, Critchleys can work closely with the company's existing accountants, taking special note of the tax situation.
They can also advise on reconstruction liquidations where one company splits into two or more businesses.
This procedure is, for the large part at least, started by creditors with a view to appointing an Insolvency Practitioner of their choosing to get in, realise and distribute the insolvent company's assets to its creditors. The appointed Liquidator will also review the conduct of the insolvent company's director(s).
An independent review can offer significant benefits to a company and its bankers. Company directors are frequently unwilling or unable to see the facts and will unwittingly distort information to give a better picture. As all lenders are reliant upon the information supplied by the directors, they need to exercise caution.
Critchleys will quickly investigate the current position and prospects, and report accordingly.
A sound business should be organised so that it can thrive; if a business is in difficulty, it is often better to stop it at an early stage to protect the interests of the participator and the creditors.
Personal Innsolvency as a Result of Business Failure
In many cases, business failure can lead to financial difficulty for the proprietor, often due to personal guarantees, leases and other related liabilities.
The Insolvency Act 1986 placed a greater responsibility on directors of insolvent companies, including wrongful and fraudulent trading which may lead to personal liability and directors' disqualification.
For more information about how we may be able to help, please see Personal Insolvency page
Contact us about insolvency
The business recovery team is able to help in a variety of circumstances. Anthony Harris, Sue Roscoe and Lawrence King are Licensed Insolvency Practitioners regulated by the ICAEW.
Between them they have many years of experience advising and acting on behalf of creditors, and insolvent companies.
Our initial advice is provided by way of an introductory telephone call and a one hour meeting with one of our Insolvency Practitioners during which we can advise Company directors and shareholders as to the best option given the Company's circumstances.