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Liquidators win request for accountants to produce company documents

6 June 2014

In a recent high court decision, the liquidators of a company were granted access to documents produced by the company's accountants.

It was believed the accountants, who had completed an audit before the company became insolvent, held important information needed by the liquidators to assess the company's affairs. This information included business dealings, among other things.

After requesting the information in accordance with s.235 and s.236 of the Insolvency Act, they were refused by the accountants on the grounds that they only audited the accounts and didn't provide tax advice to the company. The accountants also felt the documents needed had confidential information and should not be part of the liquidators' investigation.

The liquidators decided to apply to court to retrieve this information and it was successfully granted. It was decided that the liquidators did not have sufficient information to conduct their investigations and therefore could obtain further information from the accountants. It was proven it was the liquidators' statutory duty to obtain such necessary information which could easily be produced by the accountants. The court felt the request was a reasonable one.

This case highlights that is it possible for liquidators to get the necessary information from accountants through the court as long as the request is not unreasonable or onerous.