This is one for the insolvency professionals. My apologies to the casual reader.
One of the options available in the 'new' administration procedure (strange that it has been available since September 2003 and I still think of it as new) is to move seamlessly from administration to CVL. This is probably the most common exit route of those I have seen to date and two recurring errors are found on many visits.
The first error is that a resolution is included among the administrator's proposals setting the basis of his fee if he is subsequently appointed liquidator. This is not an option. If the creditors do not object to the CVL route and your appointment, you must seek approval of your remuneration from the creditors' committee, if there is one, failing which from a meeting of creditors. There is a tortuous explanation of this, but a Blog is not the place to explain which rules were disapplied by the new rules and which were left in place. If you need more detail, give me a call (if you are in the profession, you either know my number or can find an IP who does). Note that if there was a creditors' committee in the administration, it continues to act in the CVL, but you still need approval from it after you have been appointed liquidator.
That moves neatly on to the second common error. You are appointed liquidator when you file the relevant notice at Companies House. Note that it is the filing date that matters, not the date the creditors met to say you could send it, not the day you sent it and not the day that companies house acknowledged receipt. You need to check the filing date (access the Companies House online free services and you can see a basic history from which you can extract the filing date) and ensure that you record the correct closure date for the administration (on bordereau returns, receipts and payments accounts, etc) and appointment date for the liquidation (bordereau again, and, having read the paragraph above, meeting notices!!). In addition to needing to get it right for the notices and bond, it is needed for future accounts and as part of your regulation 13 case record (about which more in a future Blog).
Until next time.............
