Taking a business through insolvency proceedings will never be an easy process. There will likely be multiple parties that are concerned about having their debts repaid, and the stress can quickly start to build up.
Seeking professional advice in these situations is absolutely essential. Not only will an insolvency practitioner be an invaluable source of advice, but they’re also often legally necessary to remain in compliance with regulations. Here’s where to start with seeking advice.
It’s essential that you’re at least somewhat financially literate when it comes to spotting the signs of insolvency, so that you can reach out for help before things reach a catastrophic point. This might include rising debts, complex cash flow issues, or even a prediction of severely reduced sales. In most cases, the earlier you reach out for advice, the more opportunities you’ll have to sort the situation out.
Once you suspect that your business may be insolvent, you’ll need to reach out to an IP (insolvency practitioner) from somewhere like Chamberlain & Co. An IP is a registered professional with experience and training in how to take businesses through a range of insolvency processes.
It’s important to consult an IP who is qualified with the relevant authorities (such as the Insolvency Practitioners Association (IPA) or the Institute of Chartered Accountants in England and Wales ICAEW)). Depending on the kind of insolvency process you’re required to go through, the appointment of your IP will likely need to be confirmed by a range of different parties, including creditors and directors.
In order to make the job of your IP easier, it’s important to gather as much relevant financial information pertaining to your business as possible. The IP will likely have complete access to these areas anyway, but it’s important that everything is as organised as possible. This can help to speed up the process, and help to protect you from any accusations of wrongdoing.
Depending on how exactly the insolvency occurred, it may be necessary to reach out to a solicitor for additional legal advice. While this shouldn’t be necessary if you acted in accordance with the law and the relevant industry-specific regulations at all times, if you’re unsure as to your situation, it’s always beneficial to seek legal advice in a proactive rather than a reactive manner.
Finally, if you’re in a position of authority in the business in question, you’ll likely have a responsibility to communicate what’s going on with any relevant stakeholders and creditors. It will have a direct impact on their lives, and you need to make sure that you keep the relevant people informed.
Hopefully, this will have cleared things up a little. The key takeaway should be that if you suspect your business is insolvent, then it’s in your best interest to reach out for assistance from an insolvency practitioner as soon as possible. They’ll be able to advise you on what steps to take going forward while keeping you on the right side of the law.