Clearly it is important to ensure that both appropriate and timely disclosure is made to the creditors about the pre-pack sale. Dear IP No. 42 indicated that SIP 16 disclosure should be made to creditors no more than 14 days after appointment, but that is only best practice guidance and does not override the legislation, which requires the administrator give notice of their appointment to creditors as soon as reasonably practicable (rule 2.27). As a result, if you are unable to make the full SIP 16 disclosure to creditors within no more than say a couple of business days of appointment, then you should comply with your statutory obligation and give notice of your appointment to creditors rather than wait until you are in a position to make SIP 16 disclosure. In your notice of appointment you should of course indicate that a pre-pack sale has taken place and that full information about that sale will be provided to creditors shortly.
This means that any delay in issuing your SIP 16 disclosure could result in increased costs, with the least organised practices issuing an initial notice to creditors, then SIP 16 disclosure and finally proposals. Much better, and far more likely to impress creditors and monitors, would be to start drafting proposals pre-appointment with SIP 16 disclosure included. This would highlight any gaps in the information and by getting those gaps filled in the run-up to your appointment you should be able to issue your proposals within days, allowing you to just issue the proposals without the separate notice of appointment and SIP 16 disclosure.
This would also have the advantage of getting your fees and pre-appointment costs approved earlier, improving cashflow. Because the proposals should be a statement of what you intend to do and not a statement of what you have already done, any gaps can usually be addressed by saying that you will investigate further. We have seen several clients take such an approach and issue proposals within the first few days of a pre-pack.
