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welcome to dissolve in this advice I will talk about voluntary administration
what it is and when it's a good idea
but in brief a voluntary administration can be a great way to save a business but
you need to be a bit careful because i think they are over used
so what is a voluntary administration
well it is sometimes called an administration or a VA
it's done under the corporations law so it's binding on all creditors
the directors appoint an administrator that takes control of the company
there is a process set out in the law with the objective being to save a
business by doing a deal between creditors and the company
so what is a model company for a voluntary administration
well a company that should consider a VA is one that is insolvent so
it needs a deal with creditors,
it's a trading business
it commonly has had a one-off loss or bad trading period that is not expected
to repeat itself, and
so it is a viable business provided the company can get some breathing space
so is voluntary administration appropriate for your company?
here's a question that I like to ask
If we can fix the debt problems can the company trade profitably in the future?
If you can answer yes to that question then a voluntary administration is likely
to be the answer for you.
So, how would you kick off the process?
Well appointment is very easy.
Iit is simply a resolution of the directors of the company
you would simply sign a document like the one on screen
there is a detailed process that follows but that is run by the administrator
the process is designed to start and finish in a little over a month
the objective is to agree a Deed Of Company Arrangement commonly called
a DOCA
so what's that?
Well think of a DOCA as a deal between the company and its creditors.
The law doesn't say what the deal has to be, so the DOCA can be designed to
suit the situation.
So in summary a Voluntary Administration can be a great way to save a business
but remember it's a tricky process so make sure you get good advice before
proceeding with a VA
if you'd like more information please give us a call