Business Survival Series: Should a struggling business raise prices?
When a business struggles, change is needed to get that business moving in the right direction. One tactic that could be implemented is increasing prices.
Our submission to the Australian Senate Inquiry into Corporate Insolvency in Australia
We have sent a comprehensive Submission to the Australian Senate Inquiry into Corporate Insolvency in Australia. This is the executive summary and we also provide a link to the entire document.
How can creditors participate in a voluntary administration creditors’ meeting
The primary way in which creditors can influence a voluntary administration is through participation in either the first or second creditors’ meeting — meetings chaired by the voluntary administrator. Through this process creditors can replace voluntary administrators, have a say on remuneration and costs, approve of a debt compromise and more.
External administration in Australia: Voluntary liquidation compared to voluntary administration
Voluntary liquidation (CVL) and voluntary administration (VA) have a range of pros and cons, relative to each other. Here we look at the advantages of voluntary administration, including the ability to turn around the business, director initiation and the breathing space it provides to directors. We compare this with CVL, which is generally more cost-effectiveand more streamlined than voluntary administration. It is also generally the more appropriate option where the business is unlikely to be saved through a restructure process. This overview is intended for company directors of small-to-medium sized businesses weighing up their options for external administration.
Using a voluntary liquidation for a section 510 debt restructure: the largely ignored creditor arrangements under voluntary liquidation
Company reorganisation or restructuring is the most common way of turning around a struggling business that is insolvent, or at risk of becoming so.
An Important limitation on Deeds of Company Arrangement (DOCAs) – No Ipso Facto Protection
Once the DOCA is being administered, there is no longer a moratorium on ‘ipso facto’ clauses. In short, this allows suppliers, landlords and other creditors with suitable contracts to immediately terminate those contracts on appointment of the deed administrator.
Regular cash flow projections and comparison to actuals
Cashflow refers to the movement of money into and out of business, and it is one of the essential financial indicators for the business. This is why a proper financial record keeping is so important.
Restructuring service businesses in Australia is all about intangibles
Debt and asset restructuring for financially distressed companies has taken on a new significance in Australia with the introduction of a new process last year — small business debt restructuring.
What business assets are lost in an insolvent liquidation?
The winding up or liquidation of a company means realising the assets of the business and distributing the proceeds to unsecured creditors. The problem: some portion of the business’ total value is always lost in an insolvent liquidation. Whatever the business valuation prior to a liquidator being appointed, the final value of assets will almost certainly be lower.
If Economic Distress, Liquidate. If Financial Distress, Save through Restructure.
Businesses can struggle or fail in different ways. Consider an unprofitable transport business that hasn’t been able to put up rates in 20 years due to stiff competition. Or, consider the same type of business, where its unprofitability is caused by the inability to pay debts entered into by prior directors.
The Australian entrepreneur’s guide to starting a crypto or fintech business in the Cayman Islands
If you serve an international customer market, the question naturally arises; where is the best place to base your crypto or fintech business? Our focus here is on exploring offshore solutions for Australian fintech and crypto startups — looking specifically at the possibility of setting up in the Cayman Islands (Cayman) as a jurisdiction of incorporation.
Are you an anxious creditor? What the 3 month statutory liquidator’s report will tell you…
Are you owed money by a company that is being wound up? Don’t get your hopes up until you have seen the 3 month statutory liquidator’s report. It is this report that will give a clear indication of the likelihood of a return.