We have collated the most frequently asked questions in one place to help you find quick answers to important matters.
It is the streamlining of the current voluntary administration process introduced specifically for small businesses. Company directors remain in control while they work with a restructuring practitioner to develop and implement a restructuring plan.
Incorporated under the Corporations Act
Full details of the eligibility criteria can be found on the ASIC website. Click Here
Once a restructuring practitioner is appointed, the company and practitioner have a period of 20 business days to develop a plan and supporting documentations for creditors.
Following the presentation of the plan, creditors will have 15 businesses to accept or reject the proposal.
YES. This is one of the major benefits of the insolvency reforms. Not only do the directors remain in control, they may undertake transactions that in are in the ordinary course of business while a plan is developed and proposed.
In addition, any debts incurred following the company entering a restructure are not included in the plan.
Despite no two scenarios being the same, the streamlined process attracts a very reasonable flat fee. More importantly, the expert advice provided by the restructuring practitioner could be vital in the survival of the business. In the event that a restructure is not possible, you will like be eligible for a low-cost simplified liquidation.
The government made significant changes designed to support the survival of small businesses. The reforms which were introduced on 1 January 2021 have been designed to provide better outcomes for businesses, their employees, creditors, and the economy.
They include a new debt restructuring process, simplified liquidation and complementary measures. Read more about Insolvency Reforms.
The restructuring practitioner will conduct an analysis of the company to determine whether the company should proceed with the restructure process or liquidate.
If it is determined that a restructure is the most suitable path, the restructuring practitioner will work together with the director(s) to develop a plan that will outline how the company's creditors will be repaid.
Once presented, the creditors have 15 business days to vote on whether they accept or reject the plan. If the plan is not accepted, you remain in control of the company but should be aware that:
In this instance, you must consider placing the company into liquidation. Those who are able to access the small business restructuring process are generally also eligible for a simplified liquidation. This is a quicker and more cost-effective liquidation method suitable for small businesses.
There are many tell-tale sings that a business is either insolvent or on the verge of trading insolvent.
Our comprehensive guide on insolvency outlines indicators of insolvency, the different types of insolvency, and the relevant processes involved.
A fast way to assess the current state of your business is to conduct a free business health check.
If you haven't found the answers you are looking for, do not hesitate to reach out to us to receive free professional advice. We deal with a wide range of cases, including liquidation, insolvency, voluntary administration, and personal bankruptcy. Send us a direct message and we will be in touch with you within 1 hour.
Does restructuring sound like a mountain too big to climb? Our Resource Centre has detailed information from industry professionals on how business restructuring can help get things back on track.
Keep up to date with the latest news and real life case studies on companies that have used restructuring services to help secure their future. Acting early is the first step to financial prosperity.