The coronavirus pandemic has caused serious financial distress for business around the globe. Many companies are simply unable to continue to trade due to the effects of lockdown and other measures put in place to protect our health.
A shortage of cash is always a huge issue for businesses and even under normal trading conditions businesses can become balance sheet insolvent as it becomes impossible to pay bills when they fall due. So if your company is experiencing financial distress what should you consider the following.
A licensed insolvency practitioner (IP) will assess your company's financial situation and explore the options available which could include:
If there are no other options left and you decide to shut down your business and effectively end trading unlike compulsory liquidation a creditors' voluntary liquidation is initiated by company directors and therefore this action gives you more control over the closing down process.
A CVL ends your responsibilities and uses the remaining assets of the company to pay off your creditors. The assets are sold to the highest bidder - and that could be you. Park of our established process of implementing a creditors' voluntary liquidation is helping you explore the options to recover your business.
We will follow a proven step by step procedure to efficiently manage the liquidation of your company. In the firm instance you will work with one of our associates or directors to understand the challenges of your current financial situation. We can structure a business recovery plan that restructures capital and help secure additional finance to fund a turnaround. Should the company need to be wound up a meeting of the creditors is called to begin the formal process of winding down the business. Finally we can take an appointment as liquidator in the liquidation to arrange a fast and efficient sale of your assets and business.
Directors are legally permitted to buy back their business and assets in a CVL and we are able to provide you with advice and support on this to allow you to start trading again.
If Covid-19 has caused your company to become insolvent contact us on 0800 331 7417 to discuss your options at a free and confidential consultation meeting.