In the event of ceasing to trade, Company Directors need early advice to arrange their
affairs and protect themselves, shareholders, employees and suppliers.

Company Directors need early, independent and profession advice if they are to turn a
company round.

Company Voluntary Arrangement
An agreement between a company and its creditors whereby the company usually pays
an amount of money over a specified period of time. This approach allows the company
to continue trading and is usually in the best interest of the directors, shareholders,
employees and creditors.

Administration
A favoured procedure whereby the company applies to the Court for protection from
creditors whilst it considers its options and decides what actions it will take. The
Administrator runs the company (with the assistance of the directors), on a temporary basis.

Creditors Voluntary Liquidation
The most common action initiated by the shareholders passing a resolution to wind the
company up. The directors appoint an independent Insolvency Practitioner. The advantage
of this approach is that directors retain some control over the process.

Compulsory Liquidations
A creditor petitions the Court for a compulsory liquidation. This can be very difficult for the directors as an Official Receiver is appointed by the Dti and Official Receivers like to disqualify directors. Compulsory liquidations can be avoided by the company taking action earlier.

Administrative Receivership
A debenture holder, such as a bank, appoints an Insolvency Practitioner to protect its interest
in the company. The directors of the company will loose control of the company and this
should be avoided by taking an earlier action.

Bankruptcy is the same as Compulsory Liquidation but for an individual.

Individual Voluntary Arrangement is the same as a Company Voluntary Arrangement
but for an individual.

There are complex advantages and disadvantages with each approach. Company Directors
need early, independent and profession advice if they are to turn a company round and,
in the event of ceasing to trade, the Directors need early advice to arrange their affairs
and protect themselves, shareholders, employees and suppliers.

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