Few Things to Know Before You Go for Liquidation

Are you facing financial problem in your company? You need to find some solution so that you can get out of your problem?

A lot of pressure is mounting on you, so you need to decide something by keeping the best interest of your company. While going for your company liquidation Australia, you must avoid few things and also know how to hire any insolvency advisor.

Read the following to get you updated about all these.

      1. Never transfer your assets to any entities for lesser than fair value

It will be a mistake if you try to transfer your assets at a lesser value. Unless you get a fair value of your asset, you should never transfer them. You must also obtain a valuation of all your assets.

      2. Avoid lending money to your own company if you cannot repay it

Often few people start liquidating their personal assets to get out of their debt, which must always be avoided, however tough situation you may be in. 

Of course, you will be interested to make a turn around but pouring money in blind manner must be avoided. 

      3. Never give priority to certain creditors over any others

You may get into a legal hassle if any of your creditors ever find that you have given priority to certain other creditors and this will be considered as an unfair practice.

      4. Don’t continue with trading whilst insolvent

When you are in the process of insolvency then obviously you are not in a position to pay your debts. Continue to do trading under such circumstances lead to civil as well as criminal offence. 

      5. Don’t pay your creditors that you have guaranteed

Paying any creditors whom you have guaranteed with priority to other creditors during insolvency may give rise to claim against you by the liquidators. So, do not fall under such trap.

      6. Avoid taking advice from any unregulated or unqualified advisors

Never ever take advice from any unqualified or unregulated advisors under such situation, often you may face criminal charges if you end up doing any illegal things by taking their advice.

      7. Know full details about insolvency practitioners before

While taking advice or appointing any insolvency practitioner, you must know full details about him and know about his past experiences. 

      8. Know who can appoint insolvency practitioner

Generally, insolvency practitioners are appointed by either creditors or by the court if things have escalated to that extent. Often, it will be board of directors who appoints them to offer advice about the current situation. 

      9. Know about the credentials of the insolvency practitioners

Insolvency practitioner must be experienced, as the work is quite tricky one which needs hands-on experience. The insolvency practitioner must prove to any authorizing organization or regulator about their work.

      10. Know how to hire and who will pay their fees

Usually, the person who will start the insolvency process may be company’s board of directors or the creditor, if he brings this matter to the court to force compulsory liquidation to get their money.

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