One of the directors of a Scottish registered company, trading since 1994 and now trading from premises in Edinburgh, contacted and then appointed KSA in June 2009 to assist with the preparation of a Company Voluntary Arrangement (CVA) to the company’s creditors.
The company provides temporary and permanent personnel placements across a number of sectors including industrial, construction & property, manufacturing, technology, scientific and information technology to name but a few.
The company mainly operates in the central belt of Scotland but has also provided personnel around Europe, Iraq, and other areas of the world.
Over time the majority of the company’s business related to the construction and property sectors, making up approximately 40/50% of the company’s turnover.
The company had invested quite heavily at the end of 2007 and beginning of 2008, taking on larger offices and recruiting 17/19 new sales team members. Almost half of the new staff were recruited to focus on expanding markets like house building and consultancy recruitment.
During 2008 the company started to feel the early effects of the current economic downturn but similar to other companies the company was unaware of the drastic effect it would have on new business, existing business and also debt recovery.
At the end of 2008 the company took steps to reduce costs by making a number of staff redundant and vacating its premises in Glasgow so as to only trade from its premises in Edinburgh. Despite these changes the company was struggling to deal with historical debt of approximately £1.35m owed to unsecured creditors, including approximately £1.1m owed to HMRC.