Appointing a voluntary administrator occurs upon a resolution of directors where the directors believe the company is insolvent or likely to become insolvent. Secured creditors can, in certain circumstances, also make the appointment.
The objective of a voluntary administration is to maximise the possibility that a company will return to full operations and/or to provide creditors and members with a better return than would be achieved in liquidation.
Where appointed as voluntary administrator, resolution of the causes of insolvency are paramount in determining the future of the company.
The voluntary administrator works with directors, management and other interest groups to try and formulate a plan for the reconstruction.
As appropriate a Deed of Company Arrangement is submitted for consideration and approval by creditors.
Liquidation is the process where a company's operations are terminated and its assets realised for the purpose of distribution to creditors.
The Liquidator's role is to identify and secure the company's assets, realise these assets, investigate the events leading up to the insolvency of the company and distribute the proceeds to creditors in accordance with the Act.
The investigation process also includes a review of the directors conduct and matters associated with antecedent transactions.
Where dividends are to be declared, the Liquidator's responsibility includes a requirement to identify creditors, adjudicate claims and distribute the realisations to creditors in accordance with the Act.
Members Voluntary Liquidation
Creditors Voluntary Liquidation