Tuesday, 29 June 2010
Manchester based law firm Halliwells fails and faces administration owing RBS circa £20m.
I spoke at a R3 Conference series last autumn which examined Partnership insolvency. KSA was one of the first turnaround firms to propose a CVA for a Limited Liability Partnership law firm based in the south east.
That case was interesting for many of the same reasons as above: high secured debt to Barclays in this instance, property problems with too many expensive offices, too many people and falling sales.
See a case study here for a CVA for a LLP firm of solicitors
Friday, 25 June 2010
There is and it could be useful for you. It's called voluntary dissolution and it can remove companies from the Companies House Register if certain conditions are met. Beware though you cannot use dissolution unless ALL of these conditions are met (see detailed guide below).
Providing you meet the conditions then this is a very useful and cost effective tool, AND there is no need to incur liquidation costs, no investigation into your directors' activity and little publicity.....
This process is also known as a voluntary dissolution. This is a provision in the Companies Act to allow the removal of the company from the Companies Register, typically when the company is dormant.
If the company serves no useful purpose, its dissolution removes the need for filing annual returns and accounts. But bear in mind that the company can only be dissolved (removed from the Companies House register), if the following conditions apply:
•The company has not traded for three months; this must be a genuine cessation of trade!
•The company has no assets or property or cash at bank.
•The creditors must be circulated requesting their permission for the company to be dissolved under this process.
•Creditors are given three months to consider the request to dissolve the company and can reject such request.
•The company cannot have changed its name in this period.
•The company may not have disposed of any property or assets (this may include land and buildings, plant and equipment, debtors and other assets).
Please note that paying off debts does not necessarily constitute trading, but for detailed advice on this and all other aspects of dissolution, please call on 0800 9700 539 for further advice.
Dissolution cannot be used if:
Any formal insolvency procedure is in place or proceedings have been commenced. Procedures such as a liquidation, CVA, Administration, receivership or compulsory liquidation under the Insolvencies Act 1986, or scheme of arrangement under the Companies Act 2006.
If any petition has been issued against a company (for administration or compulsory liquidation) then dissolution cannot be used.
Advantages of dissolution:
•It is a quick and clean removal of a dormant company from the Companies House Register.
•Dissolution avoids the costs of liquidation, fees and expenses.
•It avoids formal investigation into the conduct of the directors as required in liquidation or receivership.
•Creditors may reject the application; their permission is required to proceed with a dissolution.
•Any shareholder, creditor or liquidator can apply to revive the company for up to 20 years after dissolution.
Want to know more?
Or call us now on 0800 9700539 and get some expert advice, we'll help you decide if you can dissolve it with our step by step programme.
Wednesday, 23 June 2010
If England win the champagne corks will surely be flying, if they don't? Well I suppose some will want to drown sorrows and analyse what went wrong!
The country's hostelries should do well regardless.
Anyway: Good Luck England!
Tuesday, 22 June 2010
For them the answer is usually bad news. Being brutally honest, if a company goes into administration the unsecured creditors, that is trade and tax creditors, are unlikely to receive much, if anything back from the administrator.
Any recovery or "dividend" as it is called, is usually zero pence in £1 or a small single figure dividend at most. Very rarely administrators sell the assets and the business and generate sufficient realisations to pay the bank (usually the secured creditors) in full, plus his or her administration costs and pay a sensible dividend for the unsecured creditors.
What about employees? Well the harsh truth is it may be bad news. The administrators have to take on the employee's rights after 14 days of being in office (as administrator), therefore you will often see adverts for "immediate offers for the assets of ABC Ltd". The general aim is to get the business sold as fast as possible before the administrator has to take on that risk!
So the administrator(s) will carefully assess what parts of the business can continue, what can't. Then he will make the unwanted employees redundant as quickly as possible. Retained employees are generally transferred to any buyer under TUPE.
Employees made redundant by an insolvency practitioner should visit our guide page here (http://www.companyrescue.co.uk/company-rescue/guides/redundant-employee.aspx )
Administrations are difficult for creditors, suppliers and employees, they can be fraught with problems and the administrator will generally take lots of legal advice.
Monday, 21 June 2010
The numbers, according to the latest Insolvency Index from information services company Experian reveal an 18% fall in the total number of business insolvencies during May compared to April, bringing the rate of insolvencies down to 0.08% from 0.10% in April.
Medium-sized businesses of 51 to 100 employees saw the rate of insolvencies fall from 0.24 per cent in April 2010 and 0.23% in May 2009, to 0.13% in May 2010 – the lowest point since September 2007.
Friday, 18 June 2010
Thursday, 17 June 2010
"Needing the support of those owed at least 75% of the unsecured debt, Pompey's proposed Company Voluntary Agreement (CVA) (sic) got 81.3% of the vote.
The administrator will now press on with the plan to repay creditors at least 20p in the pound over five years.
The only real opposition to the CVA - a requisite for clubs hoping to avoid further points penalties - came from HM Revenue and Customs (HMRC), which has 28 days to appeal against the decision.
Any hopes of success HMRC might harbour will depend on its ability to convince the courts the public purse is owed considerably more than the £24m Pompey's administrators claim".
Had HMRC voted for its full £37m the CVA would have been rejected. It will be interesting to see if the HMRC Voluntary Arrangement Service mount a section 6 action (s6 Insolvency Act 1986) citing a material irregularity?
It has 28 days to do so.
Well, usually the company is making some profits and your accountants advise the directors to save tax by paying the directors a small salary and then you take dividends from the reserves of profits made in the past and current years. So off you go taking money out of the business as instructed.
Then something goes wrong!
Although the advice is generally sound from a tax reduction perspective, when a company is performing well; it’s when things go wrong that directors can end up with serious personal liability problems.
See the rest of the guide here...
Wednesday, 16 June 2010
Along with law firms, with around 4,000 firms facing closure, the number of professional practices facing cashflow problems is rising.
Our TOP 20 Cost Saving Rules and Cashflow Tips
We are still in or just emerging from a serious recession now in the UK, are you prepared? If not follow this guide and you will be better able to cope.
1.You must set up a daily cashflow to control all cash in and out; this my help protect you from wrongful trading, as it stops bounced cheques. If you don't have a daily cashflow forecast click here for your free copy or email Keith Steven firstname.lastname@example.org now or call KSA on 0800 9700 539 FOR YOUR FREE DAILY CASHFLOW MODEL.
2). Click here for the next 19 tips
Tuesday, 15 June 2010
As we have commented on the website in question, with large HMRC arrears, the use of a company voluntary arrangement is a very powerful solution.
Monday, 14 June 2010
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"Shares suspended pending clarification of the company's financial position"
This is usually a signal that the company in question is heading into administration or being purchased. I guess in this case the audit qualification by the company's auditors was the warning sign.
The news will flow later today probably.
Thursday, 10 June 2010
Credit Today reports that an interesting spat has developed with Andrew Androniku (one of the the joint administrators) criticising Griffin's sums. They claim that Griffins forecasts are wrong and that Griffins' claim that a CVA could get 99p in the £1 for City's creditors was disingenuous, because they have included VAT in profit forecasts.
In any event, the creditors meeting for Portsmouth's CVA promises to be a stormy affair, if HMRC votes against the proposals for a CVA, as it has said it will, then there is a chance of the CVA being rejected.
Watch the news if that happens, this could lead to a rejected CVA, a sale or liquidation, plus a big points penalties for Portsmouth (as happened to Leeds Utd) and the club face starting the season on minus 15-20 points.
All this will be slap bang in the middle of the World Cup.
Tuesday, 8 June 2010
Are you running a HIP business as part of your company's activity or as the only activity? Please call Carol Webster on 0800 9700539 or Wayne Harrison (insolvency practitioner) on 07879 555350 for solutions. We will sympathetically get these problems dealt with and let you get on with your life.
In a reflective press release, Begbies Traynor said that it “remains confident that the number of corporate insolvencies will rise as the economic cycle develops, consistent with historical patterns for insolvencies to lag the cycle.
“However, in the short term, we anticipate a continuation of the work volumes seen in the second half of the year ended 30 April 2010”.
With the Time to Pay Scheme (or the Business Payment Support Service) still providing support to hundreds of thousands of companies and small businesses, Begbies optimistic forecast for corporate insolvency rates may be thwarted by the Government's continued support for the BPSS?
Thursday, 3 June 2010
The CVA MUST pay football creditors in full, this includes footballers, agents and the leagues, otherwise the league will not admit the club to the league and withhold the licence.
This ransom creditor approach has always annoyed HMRC as the tax man and "ordinary unsecured creditors" receive modest or small dividends, whilst rich footballers get paid in full.
Well the courts have yet to find in HMRC's favour.
With Portsmouth's CVA now in the public domain, the football creditors rule once again sees HMRC get a tiny dividend. Will this writ be successful or will HMRC mount a section 6 (s6 Insolvency Act 1986) action when the Portsmouth CVA is approved?
Wednesday, 2 June 2010
Not on planet Unite....
Reports BBC's news site
"RBS, which is 84%-owned by the taxpayer, says it is investing in new back-office technology which means it will need fewer staff.
But the Unite trade union said it did not disagreed (sic) with the move.
Unite's national officer Rob MacGregor said: "Unite does not believe that the introduction of and investment in new technology should go hand in hand with the shedding of jobs." "
What should the bank do, invest in new technology and then keep employing 500 people playing cards whilst being paid effectively by the tax payer?
You seriously have to pinch yourself and ask are these Union leaders people for real?
Oh I forgot, they get paid huge sums of money for doing very little but making stupid comments to the media, nice work etc
Tuesday, 1 June 2010
Coupled with payments out for wages / salaries and the usual month end VAT/interest/rent, has your company's cashflow been hit?
Get friendly, experts advice for FREE at www.companyrescue.co.uk/ or 0800 9700539
Get our top ten cashflow tips here and get our free daily cashflow model here
If no buyer can be found the likely fate of the club is voluntary liquidation. After that, extinction as the club will be expelled from the Football League.
The club's administrator Brendan Guilfoyle admitted he was "genuinely concerned" about the liquidation threat and said if a deal was not reached he would have to start selling Palace's best players.
The statement from the buyer (CPFC 2010): "We are trying to acquire both Crystal Palace Football Club and Selhurst Park.
"Everyone would agree Selhurst Park is pivotal to the long-term future of the club and CPFC 2010 have always made it clear they will not proceed without securing it.
"We reached what we thought was an agreement with Bank of Scotland, who are the major creditor of Selhurst Park Ltd.
"Subsequent to this agreement we have been sent a contract that does not reflect this agreement and is unworkable."
The sticking point in the negotiations appears to be over how much money the bank would receive if Selhurst Park was resold in the future.
Bank of Scotland has agreed to sell the ground to CPFC 2010 for a price lower than what a property developer may be prepared to pay but has asked for a share of any profit if it was sold again.