Administration is a quick legal process that protects your limited company or partnership by order of the Court. Once the process has started, no legal action can be taken against the business or any assets removed without the Courts approval or that of the insolvency practitioner appointed as Administrator to oversee the business.
Administration must achieve one of three statutory objectives below:
One of the most useful aspects of Administration is that it is very fast and can be done without notifying creditors or shareholders. Once the formal process has begun, the business is protected. It is then up to the appointed insolvency practitioner (usually with the help and input of the directors) to decide what to do next. In no particular order, this may be one or more of the following:
Within eight weeks of the date of the Administration order, the Administrator will write to all creditors and set out his proposals (in a written report). They may then call a meeting of creditors within two weeks of that report to discuss the proposals and vote on the outcome. The administrator has to call a meeting if more than 10% of creditors (by value) request one. The outcome of the meeting may be; carry on realising assets, move to liquidation or a company voluntary arrangement, dissolution or even a return to the directors if the business is now solvent.
Administration is a very quick way of protecting a business in trouble. The application to appoint an administrator can be made by:
If you would like to know more about administration and whether it is right for you speak to one of our experts. If you need insolvency advice the earlier you talk to someone like us the better as you will have more options. We can help, contact us today on 0800 331 7417