If you or your business are facing financial pressure, it is important that you seek early advice from a Licenced Insolvency Practitioner. I emphasise the word ‘Licenced’ since there are many people holding themselves to be professionals in this field who are not qualified to give proper advice. If you are considering an insolvency process, you need to ensure that all possibilities and consequences have been discussed.
Insolvency Practitioners (IPs) have had some mixed publicity in the past. By some, we are seen as the corporate undertakers, stripping companies to pay off the Banks and our fees. By others, we are praised for our business rescues and saviours of jobs. Only recently, a report from R3 showed that the UK’s insolvency profession helped rescue approximately 2 in 5 insolvent businesses in 2013-14. This equated to more than 6,700 businesses continuing to trade in some way after entering insolvency and helping to save around 230,000 jobs.
The first important step is to realise that you need to take advice. There are some obvious signs such as cash-flow issues, County Court Judgements, Enforcement Officers turning up on your doorstep, but there are also less obvious signs. Take for example, a director who is considering putting his house up as security or guaranteeing a trade account. Any injection of capital or personal guarantee should only be done after careful consideration.
So you’ve realised that your business may be struggling and you pick up the phone to the insolvency team here at Thomas Westcott:
Initial phone call/contact
• We will discuss with you your current predicament and outline any immediate areas for concern.
• We will then typically invite you for a free meeting. If you are a trading business, we prefer to meet at the trading premises, so we can get a feel of the operation. If this is inconvenient for any reason, we are able to meet you at one of our 13 offices, or a place to suit.
• We will review financial information, cash-flows and speak to key staff, if required.
• We will identify any potential risk for directors and advise on directors’ general responsibilities.
• We will summarise all the options available, explaining the benefits and disadvantages of each option.
• To ensure that the correct decisions are made, it is important that sufficient and accurate information is provided. As a minimum, we would want to see the last set of financial accounts, up to date management accounts, a list of debtors and creditors, cash flow forecasts and any other relevant information.
• Often, we will work with your accountant to gather and produce some of the above.
• Once instructed, we will work with the directors to ensure that the best outcome for the company, creditors and other stakeholders is reached. Any fee structure is agreed at the outset. In most cases, an IP’s fees will be met from the assets in a company and we would not seek to rely on directors to fund a procedure.
• We ensure that each party’s role is set out in writing and what is expected from them. It is important that co-operation is maintained throughout the process.
• Once a procedure is underway, we will continue to assist in any issues which may arise.
Why choose Thomas Westcott?
The Business Recovery & Insolvency team here at Thomas Westcott are approachable and empathetic to each and every case.
We are passionate in what we do and we are good at it! With a highly experienced team, we are able to provide you with personal and local advice in all areas of personal and corporate insolvency and rescue solutions.
Jon Mitchell is a Licenced Insolvency Practitioner at Thomas Westcott Business Recovery LLP and highly experienced in business rescue, restructuring and insolvency solutions.
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