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Friday, 18 July 2014

Our blog has moved!

We have now moved our Company Rescue Blog and incorporated it into our website.  You can see it at  

This will enable us to include relevant blog posts into specific pages of the site and keep everything under one roof.

Our Blog is to inform the business world what fantastic tools KSA Group can provide for restructuring viable companies. Our experts use CVA's, CVA and hive downs, pre-pack administrations and liquidation to restructure companies. Occasionally, we will announce insolvency notices, blog some anecdotes, opinions, comments on the industry, funny stories and actual KSA Group case studies. We welcome your contributions, comments as usual.

Friday, 11 July 2014

KSA Group Insolvency Notice

51 Surf Limited Creditors Voluntary Liquidation Notice

Meeting of the Creditors of the above named Company will be held at The Offices of KSA Group Ltd, 99 Bishopsgate, London, EC2M 3XD on 25 July 2014 at 12:15 pm.

See full notice below:

Thursday, 10 July 2014

Two administration case studies - printing and manufacturing sectors

We have now reached just over 100 case studies!

Our latest two involve the administration procedure. The first case looks at a manufacturing company that suffered from financial loss and was in need of restructuring. It was first agreed a Time to Pay deal (TTP) would be the best solution, however under difficult circumstances, it was eventually decided to put the company into administration to be sold via a pre-pack deal. Read more on this case study here:

The second case study looks at a printing company that was put into administration due to the loss of a major contract. However, because of a heavy balance sheet (among other things), it was difficult to find an interested buyer. Therefore the decision was taken to break up and sell off the business assets. Find out more here:

Friday, 4 July 2014

Carrnell Transport Liquidation Notice

A meeting of the Creditors of the above named Company will be held at The Holiday Inn, Rugby / Northampton M1 J18, Crick, Northampton, NN6 7XR on 23 July 2014 at 11:45 am for the purposes mentioned in Section 99 to 101 of the said Act.

Wednesday, 2 July 2014

Two CVA case studies: Locksmith and Construction company

See below for our two new CVA case studies:

The first case involves a locksmith company that suffered with cashflow due to the recession. After cutting costs throughout the business, it was still necessary to go into a CVA to ensure the company could continue trading.

The second case looks at a company in the construction sector which faced financial difficulty due to poor accounting and undercapitalisation. Many issues were recified, however there was still an outstanding debt problem which led to HMRC taking walking possession.

KSA Group shortlisted for Insolvency and Rescue Award!

We are delighted to announce that KSA Group has been selected as a finalist for this year's Insolvency and Rescue Awards, due to be held on the 1st October at Lancaster London Hotel.

KSA Group has been shortlisted for Corporate Recovery Firm of the Year in the 'up to 10 licensed appointment taking Insolvency Practitioners' category.

We look forward to the Awards Ceremony and wish all those who have been shortlisted (in the other categories - ha ha) the best of luck!

Latest rescue case study - hair salon company

Our latest Company Voluntary Arrangement (CVA) case study involves a boutique hair salon that suffered financially due to a lack of focus and overstocking of products. Business advisors for the company contacted KSA, on behalf of the director.

See our case study page for more information:

Tuesday, 1 July 2014

La Senza in administration again!

Lingerie chain, La Senza, has fallen into administration again, putting 752 jobs at risk. PwC have been appointed administrators and are looking for potential buyers for the business.

The company went into administration at the end of 2011 and has since been trying to turn itself around after it was bought by retail business, Alshaya.

For more on this story, see our news page: La Senza in administration for the second time.

If you are an employee of the business and you're worried about the future, watch our video on employee rights in insolvency:

Company insolvencies continue to fall

According to the latest Exaro Insolvency Index figures, there were 2,477 companies in administration or receivership in May compared to 2,542 the same time last year (a fall of 2.6%).

Administrations have continued to fall since April, which saw company failures decline by 2.8% compared to the same month in 2013. These latest figures suggest a 'post-recession phase', according to Giles Frampton, president of business recovery association, R3.

Due to low interest rates and perhaps more informal deals with creditors, the number of administrations hasn't increased for a few months. This indicates a new stage of the recovering economy, like Frampton suggests.

There should be a warning however to those companies replying on low interest rates to continue trading. With interest rates to rise in the near future, more businesses will start to struggle and it's expected the number of insolvencies will rise alongside increasing interest rates.

The Index report shows the number of liquidations and winding up petitions have actually increased by more than 100 cases each in May since the same time last year. This suggests HMRC and creditors are putting down tougher charges against those businesses in severe financial distress.

If you're concerned about the future of your business if interest rates change, it's worth considering a CVA or a pre-pack administration. Alternatively, you may be able to arrange an informal deal with creditors to ensure debt can be paid off while the business continues to trade. Call us on 0800 9700539 for help with arranging this or if you need further advice on all the options available.  

Monday, 30 June 2014

Case study - insulation and treatment company

A new case study which involves as insulation company suffering with cashflow. The case also shows how non-communication can be very unproductive:

KSA Group Insolvency Notice

Innovate Builders London Limited - Creditors Voluntary Liquidation Notice

Meeting of the Creditors of the above named Company will be held at 99 Bishopsgate, London, EC2M 3XD on 8 July at 11:15 am.

See full notice below:

Two bosses in contracting business banned for 14 years

Two bosses from Highland Quality Construction Limited (HQC) have been disqualified by the Insolvency Service. The department found the pair had been involved in several payments to connected companies when it appeared HQC were in debt and could not afford to make such payments. The two directors also disposed of assets without a connected company's consent.

Gary MacDonald has been banned for eight years while Colin Thompson has been banned for six years, a total of 14 years. The company went into receivership at the start of June with accounts showing it owed the sum of £9,120,005 to creditors.

The investigation showed payments totaling £520,857 were made to linked companies, despite some debt left unpaid. Furthermore, machinery was sold off with proceeds given to a connected company. 10 items that belonged to another company were sold by the directors without that company's consent. This resulted in the related business losing £486,000.  

Head of Investigations at the Insolvency Service, Joanne Covell, commented, "At a time when a company is insolvent and not paying its debts when due, the directors also have a duty to act in the best interests of the creditors. This is to ensure that creditors are treated fairly and in a transparent manner."

"Company assets should be handled in an appropriate manner, taking account of ownership and seeking to minimise potential losses to creditors."

In insolvency terms, the company created 'preference' by choosing to pay some creditors over others. This can be referred to in s239 of the Insolvency Act 1986.

Monday, 23 June 2014

Business Distress Index June 2014

The latest business distress index looks at the effect if interest rates rises on businesses.  Following a survey of 500 representative businesses, commissioned by R3, it was established that  6 per cent of business managers felt their company would be put in ‘serious’ financial difficulty with a 1 percentage point rise by end of 2015, while 16 per cent said they would be put into ‘some’ difficulty.

Giles Frampton, President of R3, said  “A one percentage point rise in interest rates is at the upper limit of what we might expect in the eighteen months, but policymakers should bear in mind that many businesses still feel they’re close to the edge of their comfort zone.”

There has been much in the press recently about the possibility of a rate increase over the coming months and how it would affect people and businesses.  In the main, it is expected that rates will only increase if the economy starts to grow significantly and with it price pressures.  Those conditions should help businesses and offset the affect of any rate rise.

Problems will arise if the costs of materials goes up significantly and the recent problems in Iraq, resulting in a sharp rise in oil prices, reminds everyone that this can happen.

As the economy continues to improve, and the rhetoric on interest rates increases, then it is likely the pound will strengthen further and this could put pressure on exporters, who are often also quite highly geared.

Friday, 20 June 2014

Wednesday, 18 June 2014

Lakeland Leather Shops in Administration as 200 Jobs at Risk

Fashion retailer Lakeland which started in the Lake District has entered administration.  Note it is not connected with the Lakeland kitchenware chain.

Up to 200 jobs are at risk at Lakeland after specialist administrators McTear, Williams & Wood were appointed last Friday.

The Management said they are trying to save as many stores, of which there are 18 currently trading, and jobs as possible.

Lakeland claims to be the UK’s largest specialist retailer of fine leather goods and has been owned by the Standring family for almost 50 years.

It has 22 stores across the country including on Market Place, Ambleside, Lake Road, Bowness, and also on Stricklandgate and at K-Village in Kendal.

Four stores, including the one at K-Village, closed immediately at the weekend.

The other 18 have closing down sales and are faced with an uncertain future.

“We are hoping to sell as much of our stock to pay creditors which will hopefully allow us to save as many stores and jobs as possible," said managing director Martin Foster.

The company blamed high lease costs and a poor weather conditions for its collapse.  Could the business have been saved by a CVA??  Possibly as lease costs can be reduced in a CVA by vacating unprofitable stores.  See this page for more details

Friday, 13 June 2014

KSA Group Insolvency Notice

Soundware Limited - Creditors Voluntary Liquidation Notice

Meeting of the Creditors of the above named Company will be held at Holiday Inn Express, Clasper Way, Swalwell Newcastle upon Tyne NE16 3BE on 23 June 2014 at 11:00am

See full notice below:

Can I sell my company's assets before liquidation?

It may be tempting to 'move' or sell assets at a cheap price from your 'insolvent' company to another company (perhaps another one you own). However this could be breaching section 238 of The Insolvency Act 1986, known as Transactions Under Value.  

Insolvency Practitioners have the power to investigate company affairs that happened prior to the business entering administration or liquidation. If it's proven that assets were sold to another company at a knock down price, the director could be made personally liable for the company's debt, as it is considered as 'wrongful trading'. 

The administrator or liquidator can actually get an order from the Court to reverse the sale of the assets as well. 

Tread carefully if you wish to go ahead with selling assets and make sure you go about things the correct way. You must obtain professional valuations from a RICS surveyor and keep records of all sales and correspondence. You must also make sure the company's board approves your plans.

It's a complex process and can easily be misconstrued as wrongdoing so if you're unsure what to do, seek legal or insolvency advice. 

Thursday, 12 June 2014

KSA Group's London Office Opening Party and TMA event was a great success!

Last night we held our first big event in our new offices at 99 Bishopsgate.

We had over 80 people in attendance and a special thanks goes to our speakers;

  • Richard Mayall from Lloyds' Mid Market Business lending team, 
  • Chirag Shah from Nucleus Commercial Finance, 
  • Ali Akram (Solicitor/Barrister) at law from Lexlaw and Robert Jones (Barrister).

and of course Keith Steven from KSA Group

The event focused on "turnaround in the recovering economy"  It was generally agreed that the recovery is taking a different form to before as banks are still risk averse as the financial crisis is still fresh in people's memories.  The big change is of course the rise of the alternative lenders/crowd funders and Asset-based lenders who are filling in the gaps.  It was highlighted that some companies are using alternative lenders (ALs) to plug gaps in their cashflow but the ALs are not doing enough due diligence.  Directors are also giving more personal guarantees.

Drinks and canapes were enjoyed by all until well after 9pm with lots of networking and new introductions. Funnily enough, some more carried on in the pub until much later....

Thanks to everyone who attended and to Jonathan Reeves of Set up and Go who chaired and put together the evening.

See the video below of the event

Part 1
Part 2

Hearts Football Club out of administration

The troubled football club has been in administration for the last year after falling into £30 million of debt.

Yesterday, news finally arrived that the club has officially been taken out of administration after exit documents were finalised with the Court of Session in Edinburgh.

The club's fans (Foundation of Hearts) rallied together earlier this year to develop a business plan, resulting in thousands of Hearts fan pledging to pay monthly payments. The club was taken over by BIDCO and now Executive Chairwoman, Anne Burge, to see it through the administration process and into a CVA.

For more details on this story, see our news piece:

Tuesday, 10 June 2014

Latest case study - an example of a Holding CVA

This case is quite different to most CVAs as the debt is paid off in one payment, rather than over three to five years. This settlement proved more beneficial than the typical route.

See here for more details:

Monday, 9 June 2014

Football clubs, CVAs and administrations

As FIFA World Cup is soon taking over our screens once again, we're looking at how CVAs work for football clubs as well as the impact of administration on leagues.

Why do football clubs go into a CVA?
Usually, the club has racked up a lot of debt and owes money to HMRC and the club's players. A Company Voluntary Arrangement allows the football club to continue running while a repayment plan is set up over a number of years. It is often the most cost-effective solution.

While there is a small penalty for clubs entering a CVA, it's far better result than than administration. Often clubs exit administration and go into a CVA to protect the business. If creditors are threatening legal actions, like Winding up Petitions, there may be little time for CVA proposals to be prepared, therefore the club can go into administration temporarily while information is being collected.

Once in a CVA, directors can regain control of the football club and the club can continue playing in the league.

For more information on insolvency and penalties, read out page on Football Creditors' Rule.

Here are some examples of past football clubs in CVA and administrations:
Hearts FC -
Truro City -
Swindon Town -
Portsmouth FC -
Port Vale -

Friday, 6 June 2014

Liquidators win request for accountants to produce company documents

In a recent high court decision, the liquidators of a company were granted access to documents produced by the company's accountants.

It was believed the accountants, who had completed an audit before the company became insolvent, held important information needed by the liquidators to assess the company's affairs. This information included business dealings, among other things.

After requesting the information in accordance with s.235 and s.236 of the Insolvency Act, they were refused by the accountants on the grounds that they only audited the accounts and didn't provide tax advice to the company. The accountants also felt the documents needed had confidential information and should not be part of the liquidators' investigation.

The liquidators decided to apply to court to retrieve this information and it was successfully granted. It was decided that the liquidators did not have sufficient information to conduct their investigations and therefore could obtain further information from the accountants. It was proven it was the liquidators' statutory duty to obtain such necessary information which could easily be produced by the accountants. The court felt the request was a reasonable one.

This case highlights that is it possible for liquidators to get the necessary information from accountants through the court as long as the request is not unreasonable or onerous.

Thursday, 5 June 2014

What does 'going into administration' mean?

We often get asked this question by customers or employees of a company.

Unfortunately for them, it is usually bad news. If a company goes into administration, the unsecured creditors are unlikely to receive much, if anything back from the administrator. Secured creditors such as banks and lenders are at the top of the list when it comes to priority.

Any recovery of money is usually very little or nothing at all. Very rarely do the assets and the business generate sufficient realisations to pay the secured creditors in full. There is also administration costs.

What about employees? Well the harsh truth is it may be bad news but every situation is different and not set in stone. 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.

The administrators will carefully assess what parts of the business can continue and what parts can't. Then they may need to make some employees redundant as quickly as possible. Retained employees are generally transferred to any buyer under TUPE. This protects them during the transfer.

If you're a concerned employee and you think you may be made redundant, visit our page on employee rights.

Administrations are difficult and stressful situation for creditors, suppliers and employees, however insolvency practitioners work hard to ensure the best outcome for all parties and will take legal advice when and where they need to.

Wednesday, 4 June 2014

Cafe Rouge owner to go into a CVA?

The Tragus Group, owner of large restaurant chains, Cafe Rouge, Bella Italia and Strada, is considering entering CVAs as part of a restructure to combat £235 million of debt.

Zolfo Cooper are expected to be appointed as supervisors to negotiate rent leases with landlords and possibly put Strada up for sale. It's hoped the restructure will put the business on firm financial footing. See our latest news piece for more on this story: latest-news/owner-of-cafe-rouge-bella-italia-and-strada-considering-cva

Tuesday, 3 June 2014

CVA and winding up petition case studies

This first case involves a digital marketing company which faced a penalty from Google (this resulted in falling revenue and low website ranking). KSA Group were appointed to assist with a CVA:

The second case study is an example of where a winding up petition was successfully adjourned, allowing a CVA to go ahead:

Monday, 2 June 2014

KSA Group's latest case study

This case study involves a company initially planning to go into a CVA, however due to a number of factors, including contracts being lost, HMRC issuing a winding up petition and a previous insolvency, it was decided by directors to stop trading and allow the WUP to go ahead.

Read more on the case study here.

Friday, 30 May 2014

Latest companies that have entered a CVA

Our website at  has been updated with all the most recent companies that have entered into a company voluntary arrangement.

These companies are now trading, and in the control of the directors, rather than going into administration or liquidation.  This website aims to raise the profile of this excellent rescue mechanism that is under used in the UK and particularly in Scotland.

KSA Group Insolvency Notice

The Two Sisters Pub Company Limited - Creditors Voluntary Liquidation Notice

Meeting of the Creditors of the above named Company will be held at the offices of KSA Group Ltd, 99 Bishopsgate, London, EC2M 3XD on 25 June 2014 at 11:00 am.

See full notice below:

Thursday, 29 May 2014

HMRC claims £24.9 billion from tax avoidance

Up £3.2 billion from last year, HMRC have collected in a record amount of unpaid tax, with more than £8 billion taken in from large businesses alone.

Serious about its commitment to tax payers, HMRC have met the Treasury’s targets on tackling tax avoidance and have ensured certain loopholes involving corporation tax and stamp duty land tax have been stopped.

HMRC received criticism last year from MP’s claiming it hasn't used all of its powers to collect unpaid taxes. Since then the government department have made sure results and targets are met and properly publicised.

HMRC’s facts and findings have been released along with the report ‘HMRC fast facts: record revenues for the UK’ – this details their overall strategies and future plans for dealing with tax avoidance.

It’s no surprise HMRC are tackling large businesses that are deliberately avoiding taxes, rather than focusing on businesses that are struggling and are having problems paying.

Wednesday, 28 May 2014

KSA Group Insolvency Notice

Kermic Construction Limited - Creditors Voluntary Liquidation Notice

Meeting of the Creditors of the above named Company will be held at the Offices of KSA Group Limited, 99 Bishopsgate, Wormwood Street, London, EC2M 3XD on 5 June 2014 at 11:00 am.

See full notice below:

Tuesday, 27 May 2014

13 carbon credit firms in liquidation

The Insolvency Service has closed 13 companies that sold over-priced carbon credits to investors, contributing to a £19 million scam.

Eco-Synergies Ltd was the company and wholesaler behind the overall operation and passed carbon credits through the other companies to sell on to investors at over 860 times the original amount.  Eco-Synergies even fooled the other companies involved by promising they'd see a 60% return without lifting a finger.

Eco-Synergies and MH Carbon Limited made false statements and offers to the public in an attempt to get customers to invest, with the carbon credits supplied by all companies unsuitable for investment.

Mr Registrar Jones of the High Court, commented, "It is plain that the companies were trading VER carbon credits as investments which is wholly incorrect and misleading. Sales were made at excessive profit margins making investment unlikely to lead to a profit or to break even."

The following companies were placed into liquidation on 1st May:

- Eco-Synergies Limited
- Eco-Synergies Nominees Limited
- MH Carbon Limited
- City Asset Partnership Limited
- Wealth Capital Limited
- C T Carbon Limited
- Alternative Capital Limited
- New Frontier Advisory Limited
- World Commodity Trading Limited
- Worldwide Commodity Partners Limited
- Beta Commodities Limited
- Capital Acquisitions Limited
- Cleartrade Limited

 At least 32 companies involved with carbon credit selling have been shut down since 2012, with over 1,500 investors affected by the scams.

Thursday, 22 May 2014

What is a CVA and how can it rescue your business?

A company voluntary arrangement (CVA) can help restructure a business that is struggling with debt and cashflow. Many directors don't know this powerful rescue tool exists and the company often goes down the administration or liquidation route.

Not only will a CVA ensure directors keep control of the business, the company can continue trading as normal. Check out our blog on the benefits of a CVA and how it can help a struggling business.

Wednesday, 21 May 2014

Pharmacy Plus has entered administration

The Bristol-based pharmacy company went into administration on Monday (19th May). See our news page for more details.

If you are an employee of Pharmacy Plus, our video on employee rights in insolvency may be of help:

Tuesday, 20 May 2014

Director banned after failing to pay business tax

Director of Smiths Storage (UK) and Miami Storage Limited, Warren Smith, has been disqualified for five years after not paying business taxes to HMRC and Leeds City Council for over a year.

The two storage companies went into liquidation in June 2011 and February 2012 respectively. The Insolvency Service found the companies to owe £177,000 to HMRC and £424,000 to HMRC. The total amount owed to creditors was over £738,000.

Failing to pay business tax, VAT and PAYE can lead to serious consequences if not dealt with quickly. The company can be issued with legal actions, like winding up petitions, which can seriously damage the company's reputation. Directors can also be made personally liable and even disqualified, as the case above shows.

If you are falling behind with VAT, PAYE or business taxes, the best thing you can do is to act quickly before it's too late. Call us on 0800 9700539 and speak to one of our corporate advisors - they will look at all available options for your specific situation.

Monday, 19 May 2014

Is your company insolvent?

Do you know if your company is solvent or insolvent?

Some warning signs are harder to spot that others, so it's best to look at all areas of the business to ensure you're prepared if things start to get out of control.

Use these three tests:

Cashflow test - can the business pay debts when they fall due? VAT, PAYE, corporation tax etc...

Balance sheet test -  Does the business owe more than it actually owns? Do liabilities outweigh assets?

Legal action test - Have you been issued or threatened with legal actions, like a Winding up Petition, CCJs or distraint?

If any of the above apply to your business, it's likely that it is insolvent. You must act quickly to avoid the situation getting worse but don't panic, there are ways to turn your business around. For example, a Time to Pay deal with HMRC or a Company Voluntary Arrangement may be the best solution.

If you have been issued with serious legal actions, administration can safe-guard the business. You may want potential buyers and those looking to provide investment to purchase the business and assets while in administration too.

Whatever your situation, be aware of the facts and act quickly to minimise risk and personal liability. If you believe your company is insolvent, you can call us on 0800 9700539 for expert advice on turnaround and insolvency solutions.

Friday, 16 May 2014

KSA Group Insolvency Notices

Zelkova Arboriculture Creditors Voluntary Liquidation Notice

Meeting of the Creditors of the above named Company will be held at Holiday Inn, Bristol City Centre, Bond Street, Bristol, BS1 3LE on 28 May 2014 at 12.45 pm.

See full notice below:

Go Service Centres Limited Creditors Voluntary Liquidation Notice

Meeting of the Creditors of the above named Company will be held at the offices of KSA Group Limited, 99 Bishopsgate, London, EC2M 3XD on 30 May 2014 at 11.00 am.

See full notice below:

Go Service Centres (Epsom) Limited Creditors Voluntary Liquidation Notice

Meeting of the Creditors of the above named Company will be held at the offices of KSA Group Limited, 99 Bishopsgate, London, EC2M 3XD on 30 May 2014 at 11.30 am

See full notice below:

Thursday, 15 May 2014

Paul Simon administration: all remaining stores to close

We recently blogged about a number of Paul Simon stores closing while seven stores were bought by Lewis Home Retail. The furniture retailer has suffered from ongoing difficult market conditions, falling sales and expensive leases.

The business and the remaining 22 stores were put up for sale as a going concern. Unfortunately, no suitable buyers have come forward and as a result, all stores will be closing and 209 employees are to be made redundant. These stores will close over the next three weeks:

Watford, Croydon, Farnborough, Byfleet, Southampton, Milton Keynes, Crawley, Colchester, Ipswich, Norwich, Peterborough, Basildon, Catford, Chadwell Heath, Fareham, Northampton, Swindon, Orpington, Rayleigh, Stevenage, Aylesbury and Aylesford.

Joint administrator from Deloitte, Lee Manning, stated, "We very much regret that a buyer for the remaining stores as a going concern could not be found. We will close stores over the coming weeks, selling the remaining unsold stock in these stores in clearance sales. The business cannot trade indefinitely without the prospect of a buyer".

If you are a customer with queries about orders or purchases, contact 0207 007 3200 or email

We are not involved in the administration and questions should be directed to Deloitte who are handling the administration.

If you are an employee of the business, please listen to the video below as it will tell you your rights as an employee of an insolvent business.  There is a link at the end of the video to the Government website which expands further on what you need to know.

Exiting administration via Company Voluntary Arrangement (CVA)

Companies can go into administration followed by a CVA as a way of protecting the business. If legal actions are being threatened, there is usually little time to prepare a successful CVA. Entering administration ensures the business is safe-guarded and allows the administrators and business more time to get things in order.

Once the company goes into a CVA, the directors will be given back control of the company and a debt repayment plan can be put in place. A company voluntary arrangement is usually a better outcome for creditors in the long run, than say administration or liquidation.

Wednesday, 14 May 2014

Printer of colour books, Butler Tanner and Dennis Limited, is in administration

The Somerset-based printing and binding firm has entered administration due to a drop in trading and difficult market conditions. The firm’s lease also ended last year and the company has been unable to find suitable alternative premises.

Trading under Butler Tanner and Dennis Holdings Ltd, the printing firm specialises in high-quality colour books, Fine Art prints, magazines and literature projects. 100 jobs are at risk after the directors made the announcement to staff at the site in Frome yesterday (13th May).

CEO, Gerald White, commented “After spending months considering the future of the business, various lease options for our existing site and searching for alternative appropriate premises from which to print, we have unfortunately been left with no option but to put Butler Tanner and Dennis Ltd into administration. We very much regret the impact this will have on our loyal staff and customers and the community of Frome.”

Administrators, Thornton Rones, are expected to be appointed next week.

Two other companies operating under BT&D Holdings Ltd, Butler Tanner and Dennis Maps Ltd and Berforts Information Press Ltd are not involved in the administration.

If you are an employee of the business, please listen to the video below as it will tell you your rights as an employee of an insolvent business. There is a link at the end of the video to the Government website which expands further on what you need to know. Please note we are not involved in the administration.

Tuesday, 13 May 2014

Directors of insolvent businesses must act properly and legally

As a director, you may have been trading profitably for many years and have always paid your bills on time. However, when the company gets into cashflow difficulties, as a director you need to make changes to the way you act. If the business is insolvent, then you have a legal obligation to do so.

Common mistakes that distressed company directors make are:

- Trading whilst insolvent which is simply carrying on trading when the business has no chance of paying creditors
- Creating preferences (paying one creditor over another )
- 'Transactions at an undervalue' (selling assets of the insolvent company to another company at a knock down price)
- Wrongful trading (this is like trading whilst insolvent except that you do it knowingly or even fraudulently)
- Failing to submit tax returns and tax payments

The best thing you can do is get advice quickly. The sooner you seek advice, the better chance you have of avoiding wrongful trading and personal liability.

Remember that if your company is insolvent, you have a legal duty to maximise creditors' interests.

Monday, 12 May 2014

Manage cashflow daily to avoid problems

"Turnover is vanity, profit is sanity and cashflow is reality."

If your company does not have a daily cashflow system set up, now is the time to do it. It's good business sense to regularly look at finances so you can spot any potential issues early on.

Why not try our free daily cashflow template? As part of improving cashflow, it's important to look at how you organise debtor collection. late payers are not good customers! See our top tips to help bring in those late payments.

Don't forget the power of cost cutting in your daily or weekly review of accounts. Keeping a good grip on finances can help you pinpoint the non-essential costs from the essential ones. We also have a handy guide to cost cutting too!

Friday, 9 May 2014

KSA Group Insolvency Notice

Sugi Limited  - Creditors Voluntary Liquidation Notice

Meeting of the Creditors of the above named Company will be held at the Offices of KSA Group Limited, 99 Bishopsgate, Wormwood Street, London, EC2M 3XD on 29 May 2014 at 11:15 am.

See full notice below:

Thursday, 8 May 2014

New London office opening party and TMA event - 11th June 2014 6pm

We will soon be moving into our new London offices at 99 Bishopsgate and to mark the occasion, we will be hosting June's Turnaround Management Association event, followed by a party on the 11th June.

The subject of the discussion will be "Turnaround and Restructuring in the Recovering Economy." We will be discussing how new crowdfunding platforms have affected the financial market and businesses in general. We will look at the risks involved and the options, if any, lenders have in the event of clients becoming insolvent.

Joining Keith Steven, speakers for the evening will include Richard Mayall from Lloyds' Mid Market Business lending team, Chirag Shah from Nucleus Commercial Finance, Ali Akram (Solicitor/Barrister) at law from Lexlaw and Robert Jones (Barrister).

Places are going fast so if you would like to attend, please email Robert Moore -

Tuesday, 6 May 2014

SMEs: tips on improving your marketing

If a business is starting to struggle, many directors drop marketing budgets first to focus on other parts of the business. This is a bad decision as many customers (new and old) can be brought in through the power of marketing and PR campaigns, resulting in more sales and clients!

It's important that directors work on the business as well as in the business!

Read our most recent blog for tips and advice on improving your marketing and your business:

Friday, 2 May 2014

Personal Guarantees in Liquidation Situations

We do sometimes get asked whether personal guarantees (PGs) can be voided if the business becomes insolvent or goes into liquidation.  Unfortunately, this is not the case as it is well...personal.  As such, it has nothing to do with the company. Leases on shops are quite often backed up with personal guarantees, as are company bank accounts, or hire purchase agreements.

Only bankruptcy can stop you having to pay out on a personal guarantee.  Otherwise it is best that you pay it or you may be able to come to some sort of agreement.  However, sometimes companies don't know they actually have personal guarantees so don't mention it if you don't have to!  Also the validity of the paperwork can sometimes be called into question so it is worth taking advice on the matter.  Call us if you have any questions.  We know Julian Donnelley of James Rosa Associates who is an expert at negotiating on PGs

One should also be mindful that if you start to pay back a debt that has a personal guarantee at the expense of other creditors it could be perceived as creating a preference - i.e. making one creditor better off than another.

Blogged by Robert Moore

Thursday, 1 May 2014

How to avoid late payment in business

Late payments from clients and customers is something many SMEs have to deal with and can often put pressure on cashflow. While you can put systems in place to chase late payers, the best thing you can do is avoid the situation in the first place so your business stays right on track. Take a look at a recent article we provided for SAP, a popular business blog:

KSA Group Insolvency Notice

Atelier Mayer Limited  - Creditors Voluntary Liquidation Notice

Meeting of the Creditors of the above named Company will be held at The Hubworking Centre, 5 Wormwood Street, London, EC2M 1RQ on 22 May 2014 at 11:15am.

See full notice below:

Tuesday, 29 April 2014

Two new CVA case studies

This first case study had a CVA approved with the help of a very understanding landlord who agreed to the surrender of the lease straight away.

The second case study shows how difficult it can be sometimes to get a CVA approved by HMRC. We managed to eventually get it approved, however it came with strict provisos which the director could not adhere to.

Liquidations on the rise in 2014

Latest statistics from the Insolvency Service show compulsory liquidations increased by 53.1% in the first quarter of 2014 compared to the third quarter of 2013 (a total of 1,072 down to 700). However, these figures could be seen as misleading as they represent the quietest period of the year compared to one of the busiest quarters from January to March.

The fact that compulsory liquidations are on the rise suggests HMRC and trade creditors are getting tougher on insolvent businesses. Interestingly, the number of Creditors Voluntary Liquidations (CVLs) fell by 7.1% since the previous quarter, but compared to Q1 last year, statistics show they have increased by 2.9%.

Looking at all other insolvencies (which includes administrations, receiverships and CVAs), there has been a reported fall of 2.8% on the same quarter last year. The number of administrations has slightly increased but CVAs have stayed at the same rate. The most noticeable change is the rise in liquidations.

In the 12 months leading to the end of the first quarter of 2014, the highest number of company liquidations occurred in the construction industry, followed by retail and wholesale sectors.

A reason for the rise in liquidations could be due to the slump in sales at the start of the year as well as perhaps poor sales results after the festive period.

Overall, including the compulsory liquidations statistics, UK corporate insolvency volume have risen year on year by around 3.3% versus 2013. So much more modest than the headline but still higher than a year ago.

Construction group, Mike Stacey Limited, is in administration

UPDATE - 14th May 2014: West Country Guns has been bought out of administration by Shaun Stacey and will trade under the name West Country Guns.  

Trading as Stacey Construction and West Country Guns, the 47 year old group fell into administration on Thursday (24th April) due to cashflow problems.

Specialising in the construction of petrol stations, the Somerset-based company appointed joint administrators, Simon Thomas and Nicholas O’Reilly of Moorfields Corporate Recovery. The company ceased to trade last week, leading to 60 redundancies.

Administrators are currently seeking a buyer for the West Country Guns division, a retailer of new and used guns.

Joint administrator, O’Reilly, commented, “The former director [Shaun Stacey] has stated that he hopes to buy part of the business to continue the specialism in building petrol and service stations. We will be in discussions with him and any other interested parties about selling this division to raise further cash for creditors.” Mike Stacey, his father, owns 51% of the business, while Shaun owns 49%.

Turnover for the 12-month period ending July 2012 was £9.8million, down from £16.9million the year before. It’s believed the drop was due to large contracts finishing over the year.

We are not involved in the administration and questions should be directed to Moorfields who are handling the administration.

If you are an employee of the business, please listen to the video below as it will tell you your rights as an employee of an insolvent business.  There is a link at the end of the video to the Government website which expands further on what you need to know.

Friday, 25 April 2014

The Gherkin goes into receivership

The famous London landmark (built in 2004) is likely to be auctioned off as the building was placed into receivership earlier this week.

The skyscraper, formerly known as 30 St Mary's Axe, is co-owned by the German company, IVG Immobilien, which became insolvent last year. During the recession, debt began to pile up due to high interest rates and changing currency value against the pound. Phil Bowers and Neville Khan of Deloitte were appointed receivers on Thursday by IVG's creditors to assist with the sale of the iconic building.

With the recovering market, it's believed a sale will take place within the next few months. The private equity firm co-owner, Evans Randall, had wanted to own more of the skyscraper but had been unable to agree a suitable solution with IVG due to the complex circumstances. Possible buyers now include, Ping An, a Chinese insurance company.

Joint Receiver, Neville Khan, stated, "The senior lenders were reluctant to appoint a Receiver but felt they had no choice due to the ongoing defaults, which have remained uncured for over five years, and concerns that the borrowers’ lack of equity in the transaction had caused their incentives to become misaligned with the Lender".

"The Gherkin is a truly exceptional building, a landmark recognised around the globe. Our priority is to preserve the value of this asset".

"We are in the process of communicating with all tenants and working with the property manager to ensure the continuation of all property management services with no interruption to tenants."

The Gherkin was placed into receivership (relating to the Law of Property Act) which is the equivalent of having the building repossessed by its creditors, as IVG could no longer keep its stake of the building.

Wednesday, 23 April 2014

Planned tube strikes

With tube strikes set to go ahead over the next two weeks (5 days of strikes in total), businesses in and around London could be pushed to the edge - so act now if you think your business might be in trouble.

Hopefully, the strikes will be called off before they can cause disruption but if not, talk to us if you need advice on cashflow and rescue options.

Take our insolvency test if you're worried your business is insolvent:

Don't wait until you're already in debt and creditors are threatening legal actions - if you're worried, act now!

Tuesday, 22 April 2014

Half of SMEs have problems with cashflow

According to Bibby Financial Services’ (BFS) most recent report, Livelihood businesses in the UK, half of the smallest businesses in the UK (with fewer than nine employees) have struggled with cashflow and bad debt over the last year.

Chief Executive, David Postings, of BFS commented, “Already this year, we have seen signs of economic recovery but it’s imperative that small businesses review their sources of finance so that they have working capital to help fulfil orders and continue to pay staff”.

Reduced supplier payment terms, falling margins and ‘bad debt’ are the top three issues faced by SMEs.

Controlling cashflow is vitally important for any business so it’s useful to have a daily template which ensures you know exactly what goes in and out of the company. That, together with cost-cutting and managing debtor collection, can help improve your company’s cashflow. Read our page on company cashflow problems for more tips and advice as well as a free cashflow template.

Thursday, 17 April 2014

Happy Easter!

The KSA team would like to wish everyone a happy Easter and a relaxing long weekend!

Wednesday, 16 April 2014

Albemarle & Bond bought out of administration

The UK pawnbroker has been bought by former Chief Executive of the Bank of Scotland, Sir Peter Burt, as part of an investment group, led by Promethean Investments.

PwC have been handling the administration of the PLC since the end of March, when lenders could no longer back the business and the pawnbroker admitted it couldn't pay the £51 million debt owed.

Over 600 jobs have been rescued with the take over of 128 branches. The remaining 59 stores will likely close, leaving 181 jobs at risk. However it has been suggested staff will be transferred to the other stores.

Joint administrator, Mike Jarvis, commented "The deal announced today was the best offer received, preserving the most jobs and keeping the most stores open. All 120,000 pledged items remain safe and available for the customers to redeem".

Overall, good news for Albemarle & Bond. With the recent struggle and fall in gold prices, perhaps it's best they now refocus on pawnbroking and steer clear of buying and selling gold.

Tuesday, 15 April 2014

Inflation rate falls to 1.6%, lowest since 2009

According to the Office of National Statistics, the inflation rate (measured by the Consumer Price Index) fell from 1.7% in February to 1.6% in March, still well below the government's target of 2%. It's the lowest rate since 2009 and has been falling consistently over the last few months.

The Retail Price Index (RPI) fell from 2.7% to 2.5% due to the 'smaller rise' in clothing prices. The gap between wages and prices is continuing to narrow, indicating consumer power is coming back, which can only be a good thing for retailers. Will the fall in inflation continue?

Monday, 14 April 2014

West Cornwall Pasty Co in pre-pack deal

Pie seller, West Cornwall Pasty Co, entered administration on Friday 11th April and was shortly afterwards sold in a pre-pack deal by private equity firm, Enact - saving 274 jobs. Read more in our news piece below:

If you are an employee of the company, direct your queries to PwC, who are handling the pre-pack administration. For employees rights' in insolvency, check out our video below:

Friday, 11 April 2014

What are Fixed and Floating Charges?

When a company borrows money, the lender (e.g. bank) usually takes some “security” for that debt as they want to be protected in case the borrower fails to repay debt in the future. If this happens, two types of charges, fixed and floating, can protect the lender.

What is a fixed charge?

The bank may have lent money to the company to acquire an asset like a building or vehicle, for example. The company cannot sell this without the lender’s permission and the debt must be repaid as agreed to in the loan agreement or facility letter.

Like a mortgage, you cannot sell the house without the lender's permission and debt must be repaid in full before you can own your home. This is a type of fixed charge.

A company’s debtor book (including factoring or invoice discounting) can also be a fixed charge. If the bank or factoring company has bought outstanding invoices and lends money against them, then these book debts belong to the lender, not the company.

What is floating charge? 

Where a lender cannot get security in the form of a fixed charge, it will usually take a floating charge against the company’s remaining assets. For example:

Work in progress
Unfactored debtors
Fixtures and fittings
Vehicles or assets not subject to fixed charges

It would not be practical to put a fixed charge over every item of stock or desks and chairs so these are left to floating charges.

Read more in our guide to debentures and examples of fixed and floating charges

Thursday, 10 April 2014

A guide to debt collecting

"My debtors are slow, or won't pay me, how do I improve debtor collection"?
This is a common question from our callers. Follow some of our tips below to help improve collecting payments.

Dealing with late payment

1.Introduce a strict policy for debtor collection built around specific target dates.

2.Assertively collect debts – it is your working capital

3.Take references up on new customers – most do not. We are amazed at how many businesses fail to ask for references, how many fail to read and act upon any they get and how lax credit limit enforcement is when faced with "iffy" references.

4.Buy a subscription to a credit reference agency early warning system. This is particularly important if you regularly open new accounts and or large accounts. It is so cheap to do and can save you, literally, thousands of pounds.

5.Refuse to supply even if a "good " customer is over limits, call them and ask what the problem is. Do they have the invoice, delivery note and are they satisfied? If yes ask for your money. If they still don’t pay consider issuing:

5.1. Final warning letter - you will commence action if you do not hear within 7 days - this helps establish that the debtor accepts the debt.

5.2. Obtain a County Court Summons form from your local court; issue a copy of it with all details correctly filled in. (We are amazed at how many people go to the bother of issuing half filled out forms!)

5.3. Tell the debtor you will issue the summons in 5 working days unless they pay. If this fails:

5.4. Issue the summons to the court. After judgment is granted call the debtor for the money. If this fails:

5.5. Proceed with a warrant of execution - basically an instruction to the court to collect the money (they send a bailiff to do this). If this fails:

5.6. Consider a winding up petition if the debtor is a company or a bankruptcy petition if the debtor is a sole trader or individual.

5.7. Up to the last step above this is a relatively inexpensive way of debt collecting

6.Build a collection system, use "Sage" or other accounts package or use a manual system with trigger dates for every invoice.

7.Charge interest – its your money.

8.Go to the customer's premises and demand to meet the owner, MD or finance director. Say you will not leave until the company gives you a cheque, even if its post dated.

Remember a good customer who does not pay is not a good customer long term!

Tuesday, 8 April 2014

Paul Simon administration: 17 stores to close

The home furnishings retailer which went into administration last week will have to close 17 stores, say administrators from Deloitte.

The company which specialises in carpets, curtains and furniture and has 51 stores, mainly in the South and South East, called in administrators last week after the impact of the recent floods led to decline in sales and cashflow problems. Together with this and already difficult economic conditions, the retailer felt administration was the best way to safe-guard the business while restructuring plans were prepared.

Lee Manning and Nick Edwards were appointed joint administrators on the 2nd April and have since come to the decision to close 17 loss-making stores in the next three weeks to encourage a sale for all or parts of the business as a going concern.

The following stores will be closing:
  • Aylesbury
  • Banbury
  • Bedford
  • Bournemouth
  • Daventry
  • Dunstable
  • Gillingham
  • Great Yarmouth
  • Luton
  • Margate
  • Portsmouth
  • Reading
  • Sittingbourne,
  • Strood
  • Wimbledon
  • Worcester
  • Worthing
If you are an employee of the retailer and you're concerned about the future, please have a look at our video on employee rights in insolvency. Contact Deloitte who are handling the administration if you have any specific questions

Monday, 7 April 2014

Employment Allowance is open for business

From yesterday (6th April 2014), around 1.25 million businesses and charities will now be able to benefit from Employment Allowance. Employers can reduce National Insurance contributions (NIC) by up to £2000, paying less or in deed nothing to HMRC for their employees.

If you pay less that £2000 every year in NIC, you will no longer need to pay anything.  It’s estimated around 450,000 businesses can now stop making payments.

Any businesses, charities and amateur sports clubs that pay class 1 National Insurance contributions are eligible – use the government’s handy calculator to check how the allowance affects your business. Note that public authorities cannot claim. Furthermore, if you are in a group of companies, only one company is entitled to the allowance.

You can use your current payroll software to claim.

This is great news for small businesses and is a welcoming approach from the government to help alleviate financial struggle.

Friday, 4 April 2014

What’s happening to our high street?

Recent figures from Deloitte show one in five shops stand vacant after a number of large retailers have fallen into administration over the last five years.

However the high street is in fact performing better than retail parks and shopping centres when it comes to occupying vacant premises. Retail parks account for 37% of vacancy rates compared to the high street’s 20%.

Since 2009, 27 large retailers have entered administration, like Blockbuster and HMV, with some going bust and others closing down many of its stores and downsizing. According to research from the Local Data Company, more than 4000 shops have been left empty. Furthermore they believe there are, in total, around 43,600 shops currently vacant.

With the high street outperforming less central locations, there is noticeably a shift in the high street landscape, with many traditional shops being swapped for budget retailers and entertainment outlets, including restaurants and cafes. Deloitte revealed Poundland and other discount retailers are taking one in five vacant properties.

The ‘click and collect’ style of shopping is bringing shoppers back from online retailers to the high street as it more convenient for the busy customer who won’t often be around at home to sign for deliveries. The idea of picking up orders on the way to and from places like work is very appealing as consumers get what they want on their own schedule, not the postman’s!

There is still a long way to go to tackle the number of vacancies but evidence suggests the high street is coming back with cities and towns set to look a lot livelier in the future.

Tuesday, 1 April 2014

Christmas shop director disqualified for seven years

Director of all-year round festive shop, Hartes Christmas Shop, has been banned for seven years due to poor-record keeping.

Leo Jones ran up debts of £290,000 was unable to provide the required records to administrators when the Blackpool-based company went into administration in February 2010. It was revealed records of sales could not be found nor could receipts showing the value of stock.

Not only did Jones fail to provide the right documents, the court found he transferred funds from the insolvent company to his other companies instead of paying creditors.

This would fall under the Preference insolvency Act. This is where a company pays back more debt to one creditor over the other, often deliberately doing this to make their ‘chosen’ company or creditor better off. In this particular case, he paid money to his other companies (solely to benefit him) rather than paying back what he owed to creditors in the appropriate ways.

Friday, 28 March 2014

KSA Group Insolvency Notices

Justgo Music and Entertainment Limited Creditors Voluntary Liquidation Notice

Meeting of the Creditors of the above named Company will be held at The Hubworking Centre, 5 Wormwood Street, London, EC2M 1RQ on 10 April 2014 at 11.15 am.

See full notice below:

The Heatherslaw Bakery Limited Creditors Voluntary Liquidation Notice

Meeting of the Creditors of the above named Company will be held at the Berwick Workspace, Boarding School Yard, 90 Marygate, Berwick upon Tweed, TD15 1BN on 10 April 2014 at 11.15 am.

See full notice below:

Latest KSA case studies - a CVA and a CVL

This first case study coincided with its sister company going into liquidation. What started out as a CVA, turned into a CVL as the company realised it was no longer viable after a few months. See the full case study below:

The second case study involves a company that was in the middle of CVA proposals when a winding up petition was issued by HMRC. KSA managed to stop the petition from being advertised (and later stopped it altogether) once the CVA was aprroved by creditors. See full case study below:

Tuesday, 25 March 2014

Albemarle & Bond in administration move

The UK pawnbroker has filed a Notice of Intention (NOI) to appoint administrators today after it was unable to come to an agreement with lenders over alternative restructuring plans. Only yesterday it was reported shares were to be suspended after lenders confirmed they could not support the proposed restructure.

The company has struggled financially over the last couple of years with falling gold prices against growing debt.  According to reports, Albemarle owes £50 million to its creditors, Barclays and Lloyds. They have rejected a restructure, therefore the company will soon fail to meet its liabilities.

Albemarle has said it wishes to appoint joint administrators from PricewaterhouseCoopers LLP.

As the company enters administration, there will be over 1000 jobs at risk across 230 stores. Creditors reportedly felt selling the business would not be a feasible option, however there aren't many options left now for the company.

UPDATE: Joint administrator, Mike Jarvis, of PwC has said "Our priority is to keep all pledged items safe and available for redemption as normal. We plan to sell all or part of the business to protect as many jobs as possible and we have already paid, or will be paying all staff - including accrued bonuses - as normal in March. Also, all landlords have been paid. However, some redundancies may be necessary depending on the outcome of efforts to sell the business. Every branch will initially remain open as sale discussions progress. This also enables customers to continue to redeem their goods as normal as they pay off their loans."

We are not involved in the administration and questions should be directed to PwC who are expected to be handling the administration.

If you are an employee of the business, and you're worried about what might happen in the future, then please listen to the video below as it will tell you your rights as an employee of a insolvent business.  There is a link at the end of the video to the Government website which expands further on what you need to know.

Friday, 21 March 2014

March Quarter Day - negotiate with your landlord

The 25th March is the March Quarter Day when rent is due on commercial properties up and down the UK.  This is always a nervous time for retailers as they have to find three months rent in advance. In the current economic climate many landlords will be open to negotiation and may allow tenants to pay on a monthly basis, so ask!  Landlords of shopping centres who may be seeing rising vacancy rates may be more open to this proposal.

So if you are a struggling multi-site retailer, you can use a CVA to jettison stores that are putting the viability of the whole business at risk. The landlord does not automatically have the casting vote in any proposal even though rent may be the biggest cost.  The reason being that rent is in advance so they can only vote in relation to the arrears of any rent.  Of course if you have run up large arrears then that situation may change. However, given the somewhat antiquated legal remedies for rent collection, such as distraint and forfeiture, high levels of rent arrears are rare in commercial cases.

Wednesday, 19 March 2014

Top 20 cost-saving tips for businesses

1. You should set up a daily cashflow to control all cash in and out. This may protect you from wrongful trading, as it helps manage cash and stops bounced cheques. If you don't have a daily cashflow forecast, please ask for KSA’s free model (PS don’t bounce cheques it's bad form!).

2. All purchases are approved by you as MD/FD/Operations Director/Owner. You should sign all cheques or approve all BACS/CHAPS payments in writing.

3. No purchases are approved unless signed by you, which will make “them” produce a purchase order. Then you can check if they are doing their job, is the price fair, are they and your supplier ripping you off, or are they just lazy and not getting the business best value?

4. No petty cash is drawn from the bank unless you personally go and get it… makes you question what every pound is spent on when people ask for cash. If not possible because your business is too big, why not make a trusted person do it. NOT a big issue if cash is king?

5. Review all expenses claims by the staff; reject all that are not really necessary. If you get complaints or murmurings (they may be too scared to act professionally and debate with you), then meet with them and explain the position. Bluntly, tell them survival is now the main aim.

6. Remember survival is key, if you lose people or profits that’s not vital, cash is king for now. Profits will soon flow from very tight cashflow management.  If people sue for unfair dismissal, call us and we can help - we may be able to kill off their claims with straight talking. Or perhaps a CVA can kill these claims too.

7. Ask every supplier for a review of their prices, can they cut you a better deal? Ask them to for a few extra weeks payment grace. They may object but they will welcome smart business people staying in business. That’s better from a creditor’s point of view than people putting heads in the sand!

8. Ask the landlord for a breather on rent. Can you please pay monthly not quarterly for a while? This helps cashflow. It actually puts you in arrears but that’s maybe OK at this stage. Again they want a paying tenant, not an ostrich who won’t talk.

9. Ask your accountants to accept monthly payments. If your accountancy fee is £10,000 pa, then ask to pay over say 10 months that’s £1,000 per month. The same applies for anyone else that issues a big annual fee note.

10. Manage cash every day!

11. Get someone else’s view; do you have a trusted friend? If so talk to them about your business, actions and get them to sanity check you. They may suggest cost savings, test your closeted views and make you think about changing ways.

12. Do you need that company car; can you use your own and give it back?

13. Can you sell any assets, will it raise cash? Make sure they're not owned by a leasing company first.

14. Ask your factors to cut their costs, only drawdown weekly. Using your daily cashflow model will of course help with this.

15. Cut all overtime to the bone, why do you need it? Is your production planning so poor or weak? If you need more people hire them, at lower rates.

16. Did we say “Manage cash every day"?

17. Use the internet to buy or price everything; you can get fantastic value over the net.

18. Work all hours, to build the recovery plan and set out the Time To Pay Deals with TAX AND VAT.

19. Keep minutes or notes of all decisions. If you’re a partnership or sole trader, keep notes!  This will help protect you.

20. Finally be aware that people will be less organised than you - if a customer is not paying, find out why!

Monday, 17 March 2014

Lloyds to give an extra £1billion to SMEs

In response to falling lending figures and negative feedback, Lloyds is pledging an extra £1 billion to small businesses to help improve the lending process and increase opportunities for SMEs seeking finance.

SMEs aid economy growth and banks, like Lloyds, are recognising this quickly among the many other alternative lenders that help businesses continue to expand.

According to the Bank of England, SME loans fell by £300million in January. Small businesses are increasingly finding it difficult to raise capital through traditional lenders and are turning to alternative funders like peer to peer lending and crowdfunding.

In a recent Office of Fair Trading report, major banks have been failing to obey with competition regulations by stopping customers from accessing alternative lenders. Lloyds is planning to rectify this by recommending such lenders if they prove to be a better fit for customers.

An independent report, the SME Finance Monitor, revealed small firms are likely to be accepted for business loans more than they think. Figures showed 38% of small businesses felt their business loan would be approved, when in fact 67% of SMEs were approved. This is due to the poor perception of banks.

The Better Business Finance (BBF) campaign, organised by the Better Business Association (BBA) and the five leading high street banks, aims to improve confidence within the SME sector as well as improve the reputation and perception of bank lending.

The BBA are now working with alternative lenders to ensure businesses are given a wide range of options to best suit their financial needs.

Llloyds are keen to help small firms too when they are in financial hardship. As their figures show 70% of struggling firms they lend to, are helped back on their feet by the bank. Tim Hinton, Managing Director of Lloyds’ SME and mid-market banking says, “We want to help our SME customers at all stages of their journey, including when they are in difficulty.”

Banks are now realising the overwhelming competition they face when it comes to financing small businesses and are trying to get back in to customers’ good books. Will schemes like this work? Only time will tell!

Thursday, 13 March 2014

Director banned for 7 years due to poor keeping of accounts

Director, Timothy Lynch, of Blackburn vehicle recovery business, TJ Recovery, has been disqualified until 2021 due to failing to keep up-to-date accounts and records.

An investigation from the Insolvency Service revealed Timothy Lynch had also failed to provide evidence of financial deals and exchanges within the business. Turnover for the business was recorded as £36,000, yet £254,000 passed through its bank account, with £83,000 of that sum unacknowledged. No PAYE had been paid between 2010 to 2012 nor had VAT.

Furthermore, Lynch’s wife had been transferred £100,000 to her account and then sold the assets for £85,000, which again could not be accounted for by Lynch.

TJ Recovery was placed into liquidation in April 2012 and owed over £109,000 to creditors.

This is a warning to all directors to ensure accounts are kept up-to-date and filed accordingly. Failure to do so could not only put the company in jeopardy but could put the director at risk of being personally liable for all debt. For more information, read our guide on directors’ disqualification:

Latest CVA case studies

Both of the companies below were rescued by company voluntary arrangements and creditors received a substantial amount in the pound over a fixed term.

The first was a case where the local authority had obtained a liability order in respect of unpaid business rates. Through negotiation, the provision of updates and finally the supply of a draft CVA, KSA were able to gain an undertaking for this order to not be enforced. Read more on the case here:

The second case resulted in working alongside another insolvency firm on the bank's panel due to the debt owed and the bank' potential exposure. The case also demonstrates that a company can successfully propose to exit CVA early if things are going well. See the full case study here:

Tuesday, 11 March 2014

Banks are stopping SMEs from accessing alternative finance, says OFT

The latest report from the Office of Fair Trading (OFT) suggests banks are holding back small businesses from accessing alternative funding.

They are making it difficult for small businesses to get loans from crowdfunders and peer-to-peer lenders by delaying sharing paperwork and important information. Banks are unfairly stopping competition, something which needs to be addressed. According to the report, banks have yet to show they are adhering to the Competition Commission investigation which began 12 years ago.

Known as ‘bundling’, some banks have only let businesses receive loans if they open an account. Vince Cable, Business Secretary, supports the view that banks are not giving enough support to small businesses.

It can sometimes be a complex process if businesses borrow from a number of different lenders as there needs to be a system of priority in place if the borrower defaults on a loan. Clearly more needs to be done though to ensure businesses have as many options as possible when seeking funding.

While banks have agreed to review and change their outlook, if they don’t adopt new ways of thinking, the OFT will impose further action. You can see OFT’s full report here:

The Competition and Markets Authority will be taking over the OFT and Competition Commission in April to look into specific cases.

Monday, 10 March 2014

Institute for Turnaround calls for change in business support banking

A report by the European body, Institute for Turnaround (IFT), has released a report today on the ‘questionable’ processes and practices of business support banking, including RBS’s Global Restructuring Group (GRG). This research has been passed on to the Bank of England and the HM Treasury.

The ‘Benchmarking Best Practice in Business Support Banking’ report calls for new regulations to change the way UK banks run their business support units. Over the last year, IFT have researched more than 250 businesses that have been put into turnaround units across the UK. The research also includes evidence of meetings with certain senior officials employed by the big banks - Lloyds, RBS, HSBC and Barclays.

One of IFT’s main concerns was the correlation between fees charged and bonuses rewarded to bankers (bonuses depended on excessive fees). This often made some businesses stay in the unit for longer, delaying opportunities for extra funding and restructuring because there was a lack of motivation on the bankers’ behalf.

Fees were piled on to struggling businesses that could not afford them, letting them fall deeper into insolvency. A senior executive from RBS admitted, “GRG has a culture of taking aggressive action - not necessarily illegal – and encourages its people to do the same.”

Authors of the report, CEO, Christine Elliott and Chairman, Iain MacRitchie of IFT, have produced a number of principles and suggestions for bank units and troubled businesses to focus on. They want to see banks provide ‘transparent, respectful, documented and open to challenge’ advice and support and not be ‘profit centres’ whereby bonuses mean more than saving a company.

Fees should also be no more than what’s charged for viable companies and the company’s situation must be taken into account when fees are calculated.

Furthermore, the IFT wants companies to have the option of being referred to an ombudsman as well as having a channel for both bank staff and customers to report any concerns or issues.

You can view the full report here.

Thursday, 6 March 2014

FCA confirms new crowdfunding regulations

The FCA (Financial Conduct Authority) has released new regulations for crowdfunding in a bid to protect consumers from lending to businesses without knowing the risks involved.

Outlined in the policy statement, the UK regulator wants these new alternative lenders to operate in a transparent and fair way by providing clear details of the risks to those looking to invest.

Peer-to-peer lending (a form of crowdfunding whereby investors lend directly to the individual or business) will be regulated from April 2014.

The FCA suggests many individuals are unaware of the risks involved when investing in new businesses and projects, and are proposing new or inexperienced investors to confirm they will not be investing more than 10% of their money on ‘unlisted businesses’.

In the FCA’s statement, the new rules include:

- “Require firms running the loan-based platforms to have plans in place so that loan repayments continue to be collected even if the online platform gets into difficulties.
- New prudential regulations will be introduced over time so that these firms have capital to help withstand financial shocks. This is important as consumers who lend money through these firms will not be able to claim through the Financial Services Compensation Scheme”.

The UK regulator also states there will be the same level of protection for consumers, regardless of how they contact crowdfunders, whether it be online or by phone.

Crowdfunding platforms are fast becoming an alternative to banks for many small businesses and start-ups. They have been a huge success in America and now more and more UK platforms are being set up every month to help those in need of funding.

This is an exciting time for new and alternative lenders coming onto the market. The number of crowdfunders and peer-to-peer lenders will no doubt increase as the year goes on. Already in the first two months of 2014, crowdfunding platforms have raised £5.7 million for businesses.

Should banks be worried?

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