How does Insolvency impact you?
The simple answer is: you miss out on money! The amount of money you lose is up to you. When a company owes you money there are some obvious and some subtle warning signs of insolvency to look out for. (LINK FAQ/Terminology- secured and unsecured creditor)
As a secured creditor (LINK FAQ/Terminology- secured and unsecured creditor) you have the authority, under the Australian Corporations Act 2001 (Cth), to take action when a company is in obvious financial difficulty. Read More
When you are not being paid by a company that owes you money for invoices submitted, please consider carefully before you continue supplying goods or services. We have been told that both successful and unsuccessful companies get behind in paying their invoices. In our experience, non-payment, delayed and part payment of invoices are not the signs of a successful company.
Only you can decide how long to wait for payment for work you have done or goods you have supplied. Struggling business owners often promise to sort out payment next month, or pay some of what is owing to you or promise everything will be paid in full after this next job or goods delivery. It is amazing how many creditors believe such assurances.
How we can help
When a business is struggling it is unlikely you will be paid without formal procedures.
As a secured creditor you are not without power to make something happen. Creditors can choose between administration or receivership.
The most common first step for secured creditors is to appoint a Voluntary Administrator, who takes control of the company to work out a way, if it is possible, to save the company and/or its business. The administrator must report to creditors on the company’s business, property, affairs and financial situation then recommend three options to move forward.
A secured creditor/s who hold security interest over some or all the company’s assets can put the company “into receivership.” However, be careful because this may not be the best first step especially when there are leased premises involved.
Get an expert opinion from Bob Jacobs and his team. Make use of their extensive experience in restructuring and turning around companies to deliver the most cost-effective solution for creditors. We all know that proverb: Do not keep doing the same thing and expect a different outcome.
Bob Jacobs is registered with ASIC to be appointed as a Receiver, Administrator or Liquidator. Contact us now. First meeting is free.