Administration is a procedure which allows for the reorganisation of a company or the realisation of its assets under the protection of a statutory moratorium, which prevents creditors from taking action to enforce their claims against the company.
In the vast majority of cases, administration is used to reorganise or realise the assets of insolvent companies.
When a company enters administration, an insolvency practitioner is appointed as the company’s administrator. The administrator takes over the control of the company’s business and assets from the company’s directors, in order to achieve one of the statutory purposes of administration; which are as follows:
- Rescuing the company as a going concern;
- Achieving a better result for the company’s creditors; or
- Realising property in order to make a distribution to one or more secured or preferential creditors
If your business is encountering financial difficulties please contact one of our experts for a free, no obligation meeting to discuss your circumstances and the options available to you.