If your company is struggling, here are some questions you may be asking yourself;
– Am I going to need to go bankrupt?
– Should I call a Bankruptcy Specialist?
– Is my company going to be wound up?
– Should I call a Liquidator?
– What is a Statutory Demand?
– What is a Director’s Penalty Notice?
WHAT ARE MY OPTIONS?
Firstly, DO NOT call a Liquidator. DO NOT call a Bankruptcy Specialist and DO NOT make any rash decisions. It should come as no shock to you that a Liquidator will advise you to place your company into Liquidation and a Bankruptcy Specialist will advise you to declare yourself bankrupt. They are running a business as well…. You need to know ALL your options before you choose.
As Pre-Bankruptcy and Pre-Insolvency specialists, we will help you decide what is best FOR YOU!
Call us for a free NO OBLIGATION discussion. It could be the best call you ever make!
Ph: 1300 255 059
Liquidation – The cold Hard facts
Too often Business Financial Issues are the end of both a business and a lifetime’s hard work, and sometimes even the end of a business owner’s personal assets!
So, you want to know the facts? Here they are hard and fast…
Liquidators are NOT your friend!
Often when a business owner or company director finds him or herself in a tough financial position they are advised by either their accountant, their solicitor or even their friends to contact a Liquidator and place the company into ‘Voluntary Liquidation’. The belief is that because you are paying the Liquidator they will look after your best interests and help you to get back on your feet.
NOTHING IS FURTHER FROM THE TRUTH.
Although in my experience Liquidators, Administrators and Receivers are usually nice people, their responsibility, once they are appointed, is to your ‘creditors’ (people you owe money to) and to the courts. They are to collect as much money as possible from the liquidated company to pay off these creditors. That’s it. If for one minute you feel they will look after your best interests you are sadly mistaken. You do not even factor in their equation.
Once you sign those documents to appoint the Liquidator to your business, that is it! You no longer have any control over the company and the Liquidator will do whatever they feel is in the best interests of the creditor and guess what, in many cases you have just paid for your own business death!
One Business Owners Experience
A client writes
“You were right, I should have listened to your advice, instead I listened to the advice of my accountant and went directly to a Liquidator. I was told that because I am paying for the Liquidator and that this was a Voluntary liquidation, that I would be looked after. I met with the Liquidator and they seemed like very nice professional people and told me they would help me as much as they could to work through my issues. Wow, was I in for a shock. The minute I signed the paperwork the Liquidator asked for the keys and that was it. Everything was taken out of my hands and I was even locked out of my own business. The next day my bank accounts were frozen and what I thought was going to be a helpful situation turned out to be my worst nightmare. I lost everything! I should have listened to your advice.”
Preparation is the key… Without it you are a Sitting Duck!!
The key is to prepare yourself before hand. Whether the Liquidator is appointed by the courts or you appoint them voluntarily, there is a lot you need to know and do to protect yourself and your rights. Involve us. It is that simple. Our goal is to protect your personal assets, protect your business assets and if possible keep your business running. One of the most common questions we are asked is ‘Can I continue to run a business if I have been the Director of a Company that has been Liquidated?’ The answer is yes, but of course there are laws that need to be adhered to and you need to ensure you structure things the right way moving forward. Liquidation does not need to be the end of your business life as so many people experience. There are options, but in most cases people simply don’t know what they are. We simply explain your options, help you choose the best one for your situation and we all work together to achieve the BEST POSSIBLE OUTCOME.
Be prepared. Liquidators don’t work for you no matter how much you pay them. Your creditors don’t work for you no matter how much of their bill you pay off. Your friends love you, but usually have no idea what they are recommending to you. They’ve probably heard that if you want to start again you need to get rid of the company through a Liquidator or go bankrupt, and it is an easy assumption to make that if you pay a Liquidator they will work for and look after you. Understand, THIS IS NOT THE CASE!
A good outcome…..
Here’s a Testimonial from one of our clients…
“Thank you for helping us. It’s been a tough few years. Thank God we found you. We were told to just let the business fall over because it was not worth keeping and declare bankrupt. That’s easy for someone else to say but we are in our 50’s and starting something new is not that easy for us and as you know this whole mess was the result of a bad business partner. When we started again with no debt, no partner and no stress it was amazing. The bank balance keeps going up and up instead of down down down. It’s been great. Thanks again.”
In all cases the best way for you to prepare to put your company into Liquidation is to talk to someone as soon as possible, we will advise you of what to be careful of. Just by talking to someone, you are not committing to anything, nor are you making a statement about your company’s finances, you are just getting advice.
In the mean time here are some points you have to be careful of are:
– Disposal of Assets. If you decide to sell your company’s assets, do so at a realistic value. Gone are the days of selling everything for $1. If you are unsure of the value of your assets, look at your balance sheet, which should give you a good idea.
– Showing Preference. If you are paying creditors something, then pay them all proportionate to their debt level. If you decide to pay one creditor over and above what you pay other creditors, you are breaking the rules.
– Trading Insolvent. By far the biggest mistake Directors make in this situation is to carry on trading in the hope that a big contract will come through. Do not take on any more debt – period. No interest, no fines, nothing. If you do, you run the risk of being made personally liable. If in doubt of what you are doing, then get advice on how to prepare for Liquidation, it may just save you a whole heap of trouble and money.
Call us for a free NO OBLIGATION discussion or email us to find out more.
Ph: 1300 255 059