Creditors Voluntary Liquidation
This comes about when the shareholders, usually at the request of the Directors, decide to put a company into liquidation because it is insolvent. This usually happens when a company is unable to pay its debts when they fall due, or when the liabilities are greater than the assets.
The purpose of a liquidation is to appoint a Licensed Insolvency Practitioner to collect in the company's assets and distribute them to its creditors in accordance with the law.
In order to place a company into liquidation meetings of the shareholders and creditors need to be called. Prior to the meeting one or more of the directors are required to swear a Statement of Affairs which summarises the assets and liabilities of the company, including a schedule of the company's creditors. At the meeting of creditors a report will be presented which includes the Statement of Affairs and details of the circumstances leading to the liquidation. It is at this meeting that the Liquidator's appointment is confirmed.
Once appointed the Liquidator has a duty to investigate the affairs of the company and the conduct of the office holders.
If the liquidation takes longer than a year to complete, within 3 months of the first anniversary and any succeeding years, the Liquidator must summon a meeting of creditors, send out a receipts and payments account and a report setting out his conduct of the liquidation. A report must also be sent out and a meeting called when the liquidation is ready to be finalised.
Dains will make this process as painless as possible by utilising our years of knowledge and a sensitive, professional approach towards all interested parties. Tough times call for experienced heads.
Dains Business Recovery Limited - Registered Company number 10115314. Registered office First Floor, Gibraltar House, Crown Square, First Avenue, Burton on Trent, DE14 2WE. Registered in England and Wales.
Martin FP Smith and Nicola J Meadows are licensed in the United Kingdom to act as Insolvency Practitioners by the Institute of Chartered Accountants in England and Wales. Furthermore, they are both bound by the Insolvency Code of Ethics when carrying out all professional work relating to an insolvency appointment. When acting as Receivers, Administrative Receivers or Administrators they act as agents only, without personal liability and when acting as Administrators, the affairs, business and property of the company are being managed by them.