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Your Objectives
Now that you have read how to use the site and establishing insolvency we
hope that you agree that it is best to establish just what your business and
personal objectives are?
Clearly this process cannot be "all things to all men" but we have set out
here the main objectives for business people, their family, their employees
and their creditors.
Using the links in the text below will take you to the relevant techniques
highlighted. But if you want a general outline first click here
Your Options
Personal Objectives
Getting rid of the pressure
Look, in our experience few people set out to run an insolvent business.
Because of many different circumstances the business is under pressure. As a
senior part of that business you are under pressure too. Often this can be
because of procrastination - failure to make a decision. Often this is
improved when a decision is taken. Whether closure or rescue and restructure
there will still be pressures (of a different kind!).
CVA,
Administration,
Trading Out or
Refinance.
CVL,
Receivership
Crystallising the position
Related to above. It is important to draw a line in the sand. Even if the
decision is to explore all options, compare and discuss and then wait for
other pieces of the jigsaw to fall into place - that is a decision. But
monitor progress and ensure that together you are achieving the set
objectives.
Getting on with your life
Perhaps it is just time to walk away and get on with something else. It is
rarely as bleak as you think to close a business - life does go on.
CVL,
Receivership
Saving your marriage
The pressures can be very difficult to leave at work. Your spouse may also
be part of the business. If so then involve them in the decision making
process. They often have an ability to see past the pressure points to the
bigger picture. Decide if the business pressure is worth losing your
marriage? CVL,
Receivership. If it is viable and you are determined then
think of how to improve the day to day effects on your marriage.
CVA,
Administration,
Trading Out or
Refinance
Protecting your family
As saving your marriage. Remember a family is much more important than ANY
business.
Protecting your health
As saving your marriage, alcoholism, stress related illness and other
problems can be caused by business pressure and failure. Consider yourself.
Are you the right person for this job? Is being in business a good idea? Is
the business viable? CVA,
Administration,
Trading Out or
Refinance. If it
all seems too much for your health and you cannot change lifestyle to avoid
the symptoms of business pressure, then consider closure.
CVL,
Receivership
Avoiding personal liability or personal guarantees
This is a perfectly reasonable objective from a human nature perspective.
However, be warned trying to avoid this may lead to problems. Remember the
mantra: "maximise creditors interests first". Of course you are a creditor
or perhaps a contingent creditor, but you are connected to the company and
therefore have to (effectively) put all other creditors interests above
yours. For example liquidating a company after paying off the bank overdraft
might get rid of a nasty personal guarantee - but this could be a
"preference" and a liquidator may seek repayment.
Not letting people down
This is an area that affects most people we talk to. But be honest with your
assessment of the business viability, decide on appropriate action and
explain the decision. If you are strongly in favour of this course of action
and demonstrate leadership to achieve it , this is the best way not to let
people down. Failure to act is not.
Business Objectives
Keeping the business alive
It is possible to keep the business alive but only if there is a reasonable
prospect of restructuring, attracting more finance or even a sale of the
business. If this is a key objective consider a CVA, Administration, Trading
Out or Refinance. Achieving a sale in the timeframe available may be very
difficult and the value of the business may be very low (or nil) but at
least this objective may be achieved. In addition some of the other
objectives on this page will be too.
Maximising interests of creditors
This should be your key objective. If by continuing to trade, creditors
interests are compromised think about closure. CVL, Receivership. However,
if the business is viable and if the meltdown of the assets of the business
would lead to minimal return for creditors then consider rescue and
restructure. CVA, Administration, Trading Out or Refinance.
Maximising interests of employees
Another very important area. Sometimes a rescue and restructure that costs
jobs is more valuable - it saves the other jobs. CVA, Administration,
Trading Out or Refinance. However, if the business is not viable
continuation of trade may work against this aim. Employment and insolvency
is a very specialist area, you must take advice on this area.
Maximising you own interests
Consider the personal objectives above.
Crystallising a difficult position
It is sometime easier not to make a decision for fear of getting it wrong.
After all your business is a living, changing, moving thing.. BUT we always
recommend making a decision and working hard to achieve the outcome. In our
experience the uncertainty that insolvency creates can be very debilitating.
You will become less and less effective as a manager and the business will
suffer. CVA, CVL, Administration, Trading Out, Receivership or Refinance.
Crystallising Liabilities
For example this could be a long term lease or contract. Conventionally this
could be only be avoided in liquidation. However, speak to CompanyRescue Ltd with
regard to how to crystallise such liabilities whilst restructuring the
business. CVA, Administration.
Complying with the law
As you may know this is a difficult area, obviously we all have to comply
with laws we are aware of. But if you do not know what the fiduciary duties
of a director are or what transactions you may or may not undertake when
insolvent - how can you comply? Take advice, email us, speak to a commercial
lawyer or speak to an IP.
Not letting creditors and customers down
Again perfectly reasonable and achievable, sometimes a pragmatic approach to
this is closure. CVL, Receivership. However once again if the company is
viable think about the options. CVA, Administration, Trading Out or
Refinance.
Not letting people down
This is an area that affects most people we talk to. But be honest with your
assessment of the business viability, decide on appropriate action and
explain the decision. If you are strongly in favour of this course of action
and demonstrate leadership to achieve it , this is the best way not to let
people down. Failure to act is not.
Avoiding personal Guarantees
This is a favourite question of directors and or shareholders. If you have
signed these documents we cannot take that way. But if the business is
VIABLE and by using appropriate techniques you may be able to mitigate,
reduce or even pay off the debt thereby reducing the PG’s
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