ICSM's December Business News Update - including a listing of who has gone bust this autumn

Welcome to our December Newsletter

Whatever your views on the last few months and how the Government has handled the Covid crisis there is one outcome that we can all agree on: it’s been highly damaging to the economy. Plus the fallout has seen hundreds of firms go under every month with many more in serious financial trouble while others have thrived such as some online retailers and manufacturers of face masks for instance. 

At ICSM we monitor (with the help of our members) firms that are in trouble and are either liable to go into administration or are not paying their suppliers. Members can use our FREE legal letters which they can use online to chase up late payers and chase down long overdue invoices which have around an 80% success rate. (See how easy it is with this video: https://youtu.be/AIycysoFhYo.) There’s also our FREE micro debt service where small but written off invoices can be settled even if they are months or years overdue. And finally our debt collection service is led by Paul Carrotte who has successfully brought in tens of thousands of pounds for members this autumn alone - if you have a problem debt contact Paul on 0844 854 1850.

In this issue we have stories that illustrate the straightened times we live in from a rise in insolvencies to how the authorities have cracked down on fraudsters who have abused the Covid bank loans. Plus there is what I term the Runners and Riders section listing several industry sectors in which firms have gone bust this autumn.

It does all seem rather depressing with the Government’s Plan A, Plan B, Plan C and probably Plan Z - and their effects on business. From working from home to a lack of orders for many sectors and a general feeling of Covid fatigue caused by the restrictions - when will it end? However if there is one chink of light it is this - if your business can survive in the current climate, adapt and make the most of things and even flourish - then you will be fine when the economy finally gets back on its feet.

On that note of optimism may I take this opportunity to wish you a Merry Christmas and a Healthy and Prosperous New Year.

Seasons’ Greetings
Ian Carrotte
Proprietor of ICSM Credit

PS: Please note as part of our systems maintenance and upgrade to the new API, we will be carrying out a ‘Spring clean’ on old archived saved reports. All old reports saved prior to December 2019 will be deleted as they are obviously out of date. If anyone has a specific requirement to keep their ‘Old Reports’ in an archive, please let us know so that we can discuss.

For details about ICSM Credit call 0844 854 1850 or visit the website www.icsmcredit.com or email Ian at Ian.carrotte@icsmcredit.com



Suspicions grow as ‘sharks’ offer ‘get out of jail free’ cards to desperate businesses looking ‘to dump debt’ including bounce back loans and CBILS

Did you know it is possible to liquidate a limited company, dump all the debts and carry on in business through a new company with no debts?

It sounds a tempting prospect but in reality ‘doing a phoenix’ is not as simple as that and is often illegal if due process is ignored. If it is shown a business has deliberately acted to dump their bounce back loans and Coronavirus Business Interruption Loan Scheme (CBILS) then not only are the directors potentially liable for those loans, but it could constitute fraud ending in prison for the culprits.

A quick online search reveals various firms offering to help companies to enter administration to stave off creditors and to potentially find a buyer through a pre-pack deal or to eventually close the business legally. Loans of any type may have a guarantee from the lender and although technically banks don’t have to ask a business for a personal guarantee (usually a home or property) for the Government’s emergency Covid loan schemes, there are many instances where they have enforced a clause as part of the loan.

If a firm cannot repay one of these loans, there is the scheme known as Pay as You Grow which restructures the repayments but to simply shut up shop and say you can’t repay the loan isn’t that simple.

Ian Carrotte of ICSM said there are ‘sharks’ out there pretending they can help a company to dump their debts and restart under a new name without any liabilities.

“We have seen sales emails and offers online suggesting it’s possible to liquidate a company without any comeback whatever the liabilities,” he said, “these are effectively fishing exercises by these ‘sharks’ to tempt the desperate company director into replying. Once hooked they are not offered the phantom ‘Get out of jail free’ cards but are pushed towards taking another loan at a higher interest rate which they can never repay.”

Ian Carrotte said there are essentially three ways for a business to close legally with a potential long term prospect of seeing the directors establishing a similar business in the future.

He said: “A Creditors Voluntary Liquidation or CVL comes from the directors of the struggling firm who will appoint an IP or licenced Insolvency Practitioner who liquidates the company. Creditors get a report from the IP before the liquidation takes place. The staff need to be dealt with and paid if possible while all the assets are listed and sold. Any money left over is then allocated first to secured creditors and after that, unsecured creditors are paid – although this is rare. Failure to do this properly or for the directors to secretly squirrel away money or assets is illegal.

“Another way is an Administrative Dissolution where the directors wind up the firm without any need for an IP – a typical example is on retirement of the owners or a firm that no longer trades and has little or no debts.”

He said that a Compulsory Liquidation is the third way to end a company and that’s more serious as usually a creditor such as the taxman or a customer has had enough of the excuses for non-payment and goes to court to get a winding up order.

ICSM has seen a dramatic rise in the number of companies simply shutting up shop without due process. Customers are not told, suppliers are left in the dark, phones and emails go unanswered, and the directors simply disappear.

“If one of your customers does this disappearing act then contact ICSM,” said Ian Carrrotte, “as there are ways to contact the directors and force them to confront their liabilities. Some of these firms hope that by simply stopping and disappearing the trail will go cold and at some stage Companies House will strike them off as companies.”

ICSM’s debt recovery department is well versed in chasing down the ‘disappeared’ and realising payment for their suppliers left high and dry.


Manufacturing and print industry news: more than a third of businesses are close to insolvency as costs mount

The Times has reported on research from trade group Make UK and RSM accounts that around 40% of British firms surveyed reported they were close to tipping into a financial crisis or insolvency.

The reasons given included debt and rising costs. Prices from manufacturers of animal feed for agriculture has seen inflation over 20% according to an investigation by Private Eye while The Times also reported that input costs for half the businesses surveyed were up 20%.

The newspaper reported: “As the latest producer prices index showed input costs up 13 per cent for manufacturers in October, against 11.9 per cent in September, a rise of that magnitude was ‘very much plausible’, especially with the combination of increases in taxation, raw material, shipping and energy costs, ‘Make UK’ said.”

It went on to say that: “Supply chain disruption and staff shortages could prove the ‘tipping point’ for businesses under strain, as customers and suppliers cling to cash or change their payment terms, according to research from Make UK, the trade body, and the accountancy firm RSM.”

Ian Carrotte of ICSM said the findings reflected the views of many of the members of ICSM’s business intelligence group with so many clients of firms admitting they were in trouble.

He said: “The restrictions brought in by the Government to combat the Omicron variant of Covid 19 will further hit business as people stay away for their offices, the night time economy is hit and spending is curtailed. We need to live with the virus and its various versions not run away and hide as commerce is being hit from all sides – HGV shortages, worker shortage in many industries, the issues over the Brexit trade deal and debt built up over the last two years.”

The Times reported that 40% of manufacturers had, “…engaged restructuring and insolvency professionals or intended to within the next 12 months, either out of necessity or as a precautionary measure.”



ICSM manufacturing news: problems mount for the YM Group after making a pre-tax loss of £8.3m and struggling to complete orders on time

Judging by the number of comments on Print Week’s website about YM in ‘perfect storm’ you think the printing and marketing group were about to join Polestar into the annals of printing history.

Several commentators actually liken the problems of the Yorkshire based quintet of companies to those of Polestar that folded in 2016. Polestar was then the largest independent printing company in the UK with 1,500 workers and contracts to print Hello, Cosmopolitan and the Radio Times. One of the reasons for Polestar’s demise was becoming over stretched by taking on large contracts which they struggled to maintain.

Writing for the online trade magazine Print Week Jo Francis reported on an emergency meeting at YM Chantry following ongoing problems at their Wakefield plant due to a press failing. The journalist wrote: “Since YM started printing the weekend supplements for the Daily Mail and Mail on Sunday six weeks ago, the business has been plagued by breakdowns and other production issues.”

She reported that the MD Peter Greaves didn’t attend the crisis meeting as he was on holiday and added that the company had let down the DMG titles over late deliveries forcing their client to shift the print runs to other companies. Last month Jo Francis reported on the late delivery of TV Choice magazine leading to speculation that the more than one million print run had to be completed at rival firms.

ICSM understands that Pricoa – YM’s paymaster - has had to inject more cash into the ailing group after making a pre-tax loss of £8.3m in the financial year ending in 2020. For suppliers of paper, ink and other services the omens are not good especially for those with long memories will recall a similar problem beset by Polestar. As one commentator wrote on Print Week’s website: “The DMG deal was the last big throw of the dice for a desperate company. Let’s not forget who headed this deal up at YM Group - the same guy who was at Polestar, and that ended well.”


Print Week reports on a director banned for abusing a Bounce Back Loan while ICSM raise concerns over insolvent PS Office Supplies

Fraudulent firms across the UK have been ‘taking the p*ss’ as they’ve been abusing the Government’s Bounce Back Loan scheme.

That’s the view of Ian Carrotte of ICSM and swathe of financial directors, credit managers and accountants in the printing and allied industries.

Ian Carrotte said: “It sticks in the throat that legitimate firms have pulled up the drawbridge, cut costs and did what they had to do to survive the Covid-19 crisis but fraudsters have been taking and p*ss. Insolvent companies have been taking the cash when they had no hope of repaying it. It’s disgusting.”

Print Week’s Jo Francis reported on the demise of Rugby-based Pick it Pack It Send It Limited and its director Christopher Pearson.

She wrote: “On 16 June 2020, Pearson was advised by an insolvency practitioner that Pick It Pack It Send It was insolvent and that any continued trading should not worsen the position of its creditors. On 27 July 2020 he applied for a taxpayer-backed Bounce Back Loan of £50,000. The scheme was targeted at small businesses to help firms get through the pandemic. The maximum loan amount available via the fast-track funding was £50,000. 

“The Insolvency Service report into Pearson’s behaviour said that on 28 July 2020, the £50,000 BBL funds were paid into Pick It Pack It Send It’s business bank account. On the same day, Pearson transferred £38,000 of the BBL funds from the company’s business bank account into his personal bank account, ‘contrary to the terms of the BBL agreement which state that BBL funds should be used for the economic benefit of the business’. Pick It Pack It Send It ceased trading on 22 October 2020.”

Since the establishment ICSM has consistently warned about the abuse of the £47.4billion Government scheme that was instigated to support business suffering during the Covid-19 shutdowns.

Ian Carrotte said: “The National Audit Office has had a right go at the Department for Business, Energy and Industrial Strategy because the taxpayer would pick up the bill for not only the interest on the loans but act as guarantors if they were defaulted on. It was a disaster waiting to happen as Government ministers like Rishi Sunak and his advisers rushed through the scheme and didn’t listen to industry voices saying this was licence for fraudsters.”

Pick it Pack It Send It Limited owed the loan but also £153,628, including £37,730 to the taxman for VAT plus £76,514 to trade and expense creditors. 

“If a member of the public took out a £50,000 loan and did what Pearson did, they’d go to jail,” said Ian Carrotte, “it took the Government until March this year to shut the stable door after the horse had bolted and shut the scheme down.”

Another case in the industry has come to light via Companies House involving a £50,000 Bounce Back Loan is that of PS Office Supplies that was wound up by IP Andrew Turpin in October. The firm crashed owing just shy of a quarter of a million pounds including the £50K Bounce Back Loan. The figures suggest that the firm may have been insolvent when the loan was applied for.

ICSM understands from industry insiders and those left with unpaid invoices by PS Office Supplies that they had concerns over its links to Nectere and one of its directors Paul Musgrove who was also a director of PS Office Supplies.

Ian Carrotte said: “These cases are just the tip of the iceberg. I’ve been banging on about the lack of due process and diligence shown by the Government’s Bounce Back Loans for months. Back in 2020 even the British Business Bank’s Keith Morgan told Alok Sharma the business secretary that the scheme was vulnerable to criminals and fraudsters. And so it’s played out. And it’s legitimate businesses that have picked up the tab.”


More stories: check our website for news on logistics, construction, hospitality, printing and publishing - and much more

PLUS: Daily Mail reports Duchess of Cambridge’s brother James Middleton’s food firm Boomf is set to go into administration owing £2million 

ICSM Credit | Home

PLUS: Bulb, Avro and now Zog: the energy crisis smashing the free market dominated by the big six leaving customers and suppliers in the lurch 

ICSM Credit | Home

PLUS: The man who had his business Buy My Debt closed down by the Insolvency Service ‘in the public interest’ is back again with a new company 

ICSM Credit | Home


Who has gone bust lately?

Runners and Riders
Below is a collated list taken from the Government’s London Gazette of various businesses who are experiencing problems in the last few weeks. It is not a completely comprehensive listing but gives most of those who have hit the rocks. 
We have broken them into different sections to make it easier to see and we have included the company number in each case. 

This list includes some notable firms we have taken an interest including PS Office Supplies, Arena Television and several energy firms.

Administrators Appointed
Create Construction Limited    05752195
Quinn Infrastructure Services Limited    02383346
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
A.P.W. Plastering Limited    07516963
Liege Carpentry & Construction Limited    08102787
R.W. Building & Driveways Midlands Limited    08225032
Savvy Construction (UK) Limited    06205926
Liquidators Appointed
A Clarke Construction Services Limited    11988235
A & R Roofing (2007) Limited    06356516
BAS Groundwork Limited    12389494
BMR Rail Limited    11235130
Bretton Construction Limited    12151053
Brygate Construction Limited    10734599
Camellia Construction Limited    12285488
Close Construction Limited    10438913
DNA Construction (Liverpool) Limited    08517713
D T Hunt Plumbing & Heating Ltd    06589774
Easy Access Construction Limited    04778979
GH Construction Limited    11330097
Halo Building Services Limited    08184156
Heart Scaffolding Limited    05508212
J-PB Installations Limited    10788573
Logistical Construction Limited    07760180
Marine Fabricators Limited    03660931
Starling Construction (London) Limited    11124182
Tranch Quantity Surveying Limited    10984451
Members Voluntary Liquidations
A. Digby and Sones Limited    00523327
Associated Access Equipment Limited    04112221
Oakland Homes (North East) Limited    06958961
Stability Structures (Ewell) Limited    00666042
Tangent Surveyors Limited    07216334
Winding up orders
Construction One Limited    11224971
Xtreme Cladding Contractors Ltd    12384337
Compulsory Liquidators Appointed S 136   
Village Energy Solutions Limited    11215024
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
A-Z Banqueting Solutions Limited    08081799
Little Rocket Events Limited    09435240
2105 Catering Limited    12385567
Liquidators Appointed
5034Events Limited    08266424
Adpuk Events Limited    12279105
AGM Event Solutions Limited    08790591
Alfies Events Limited    12124808
Expostand Exhibitions Limited    04201082
Fine Manor Events Limited    07198089
Great Expectations Events Limited    03975718
Little Rocket Events Ltd    09435240
Marquee Events (North) Limited    11313249
Snobb Events Limited    11517300
Spanswick Rigging And Rope Access Limited    11254854
Petitions to Wind Up
QEL Events Limited    10658709
Vantage Event Structures Limited    08182190
Winding up orders
D & S Storage Limited    01470681
QEL Events Limited    10658709
I.C.E. Events Hampshire Limited    11694526
Administrators Appointed
Euro Farm Foods Limited    01408776
Hider Food Imports Limited    00842813
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Dairyanddough Limited    11897388
Darban Foods Limited    12288147
Garretts Green Sports Bar Limited    07701779
Guru Foods Limited    11668982
Haddocks Fish And Chips Ltd    12328424
Liquidators Appointed
Charcoal Chicken (Wallasey) Limited    10545418
Chips & Fish Ltd    07017092
Feel Good Food Limited    06527721
Ginger Inns limited    05689476
Green Serve Ltd    11800858
Masala Wala Cafe Ltd    09981523
Spices Jamaican Cuisine Ltd    10269097
The Blind Beggar Pub Company Limited    05620518
The Covent Garden Fruit Company Ltd    08905529
The Lunch Box (A & D) Limited    04505392
Members Voluntary Liquidations
D.R. Seafoods Limited    02511511
MC Operating Limited    12495608
Unifoods Limited    03022849
Petitions to Wind Up
Hazar Meat Ltd    12505560
Winding up orders
Go Meats UK Limited    12965345
Hazar meat Limited   12505560
Administrators Appointed
Rigo Spa Limited    06487710
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
A B Coach Travel LImited    10580858
Cheap Cost Holidays Limited    09748121
Group Study Holidays (GSH) Limited    09660364
JFB Leisure limited11555612
J Wells Leisure Limited    12013887
Jewish Camp Canada Limited    11577307
Solo Travellers Limited    07606246
Yorlink Limited    08068983
Liquidators Appointed
6 & 7 Travel Company ( Heathrow) Limited    04142054
Abed Travels Limited    04401177
Alpha Holidays Limited    10270092
Ceyda Bay Limited    05188421
Cheap Cost holidays Limited    09748121
Easystay Limited    10421701
HSP Hotels Limited    10955616
Infinity Hospitality 1 Limited    11334735
Le Ville Hotel Limited    07594638
Prospects 4 Travel Limited    08592943
Sapphire Pub Company Limited    10585545
Southwest Minibuses Limited    08532612
The Travel Adventure Limited     02843839
Tuatara Travel Limited    07816050
Members Voluntary Liquidations
Holidays 4 Travel Limited    04190921
Petitions to Wind Up
Atlas Travel and Culture Limited    05135014
Winding up orders
Luxury Transport Limited    08206915
Administrators Appointed
Acton Coachworks SP Limited    11429545
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Ava Couriers Limited    11689659
B.B. Transport Limited    03333563
Bullseye Distribution (UK) Limited    06079137
Dass Commercials Limited    08240758
Driver Developments Vehicle Training Limited    12219671
Freight Moves (Midlands) Limited    09250426
Globo-Leisure Limited    10371931
Golden Fleet Logistics Limited    11695993
Heathrow Taxi Services Limited    06554095
K E S Access Engineering Limited    09808732
Latifov Logistics Ltd    10315599
Murphy Shipping And Commercial Services Limited    02090667
RWT Commercial Services Limited    07525916
Sidons Car and Van Hire Limited    07970665
Liquidators Appointed
A&L Logistics Services Limited    10372376
Bryans Taxis (Teignmouth) Limited    06358726
By George Couriers Limited    05790529
Cobra Transport Solutions Limited    08679029
Connecting Couriers Limited    05694169
Golden Fleet Logistics Limited    11695993
H & H Distribution (UK) Limited    08543460
Medley Davies Transport Limited    11949355
Raza Logistics Limited    12311841
Rossiter Haulage Limited    09779546
SMA Transport Limited    12061494
Specialist Driving Services (UK) Limited    10807633
The General Storage Company Limited    05552475
West Midlands Commercial Limited    09889595
Zago Logistics Limited    11611081
Members Voluntary Liquidations
Deltaland Rail Limited    12037955
Karman Shipping Limited    04118154
Navigate Logistics Limited    11451847
Storage (Cheshire) Ltd    10573138
Petitions to Wind Up
Africa Shipping Services Limited    09944469
Linney Refrigerated Transport Limited    09955489
Winding up orders
JSK Haulage Limited    10108218
Administrators Appointed
Mellish Engineering Services Limited    05046982
Tribus (Watchmakers) Limited    12355706
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Heritage Acrylic and Displays Limited    04850352
Liquidators Appointed
Affordable UK Designs Limited    08886797
Willoughby Engineering Limited    10382263
Members Voluntary Liquidations
Access Pacific Limited    02294984
A. G. Shepherd (Machinery) Limited    01241653
Bramwith Engineering Limited    09423076
CMGRP Marketing Services Limited    01306069
OJE Engineering Limited    10382061
PGL Engineering Limited    06677635
Stratus Engineering Limited    10344544
Yggdrasil Engineering Limited    09302544
Petitions to Wind Up
Fosse Civil Engineering Ltd    10245826
Administrators Appointed
Arena Television Limited    02261678
Castleoak Offsite Manufacturing Limited    06495499
Influencer Marketing Communications Limited     08949475
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Caesium Design Limited    09840662
CJD Productions Limited    07945979
Cresdee Communications Limited    09478063
GS Comms Limited    12404801
Hytex Communication Services Limited    02673651
Juno Public Relations Limited    10216497
Mindful Marketing Limited    11085525
SH Digital Marketing Limited    07665053
SJC Communications Limited    10004232
United Design Partnership Limited    07672233
Liquidators Appointed
ALP Marketing Limited    11951737
Ascent Digital Media Group Limited    10272378
Bryte Design Studio Limited    09316161
East Coast Promotions Limited    07893131
GS Comms Limited    12404801
Jadestone Promotions Limited    02880510
Realistic Photo Graphics Limited    00542845
Richard M Marketing Limited    09567652
Studio 2M Limted    10599014
The Message Advertising And Marketing Limited    02824238
The Wedding Directory Limited    03283572
Watson Outdoor Media Limited    08436620
Whinmoor Marketing International Limited    07975342
Whinmoor Marketing Limited    05548530
Wigan Newsagents Limited    10367244
Members Voluntary Liquidations
CME Media Services Limited    06847543
Do Good Marketing Limited    10703047
LPT Communications Limited    05396048
Markets Consulting Ltd    10164313
Maxmail    03694093
Philip Webbb Photography Limited     08466260
Redfruit Communications Limited    06376991
Royle Productions Limited    08178536
South West Laboratories Limited    04711586
The Martin Agency Limited    08684283
Winding up orders
Big Top Brands UK Limited    10685196
Glen King PR/Marketing Limited    06172935
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
CHP Publishing Limited    11610124
Lincoln House Publishing Limited    12434079
P.S. Office Supplies Limited    06748354
Sprint Envelopes Limited    04672168
Liquidators Appointed
Business Print Services Limited    04695882
Colorsign and Print Ltd    07804745
Copyprint (Wales) Limited    07277864
Digital Print & Supplies Limited    12537550
Express Print Limited    02284433
Neon Print Studio Limited    08683638
Print Imp Limited    06232176
P.S. Office Supplies Limited    06748354
Pulse Publishing NW Limited    08377367
See Learning Films Limited    08972127
Signature Signs and Print Limited    12804605
Members Voluntary Liquidations
Arthouse Creative Limited    03978300
Matthews the Printers Limited    01811630
Petitions to Wind Up
Stacked Publishing Limited    10645630
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Beauty Secrets (Radlett) Limited    07518824
BML Sports Limited    09948678
Grange Express Limited    08574083
J B R Specialist Cars Ltd    11036949
MAF Scooters Limited    09362783
UK Gift Shop Limited    12067276
Liquidators Appointed
Alumshop Limited    12010996
Carducci Shoe Company Limited    02743622
Elliot Shoes Limited    05176837
Granada Business Machines Limited    02091038
Navigation News Limited    10992756
Star Shopfront and Windows Limited    11270651
Wepost Limited    11062546
White and White International Limited    10420312
Members Voluntary Liquidations
Atkinson Tractors Limited    00880460
Forest Boards Limited    01706486
Winding up orders
Isupply Direct Limited    09190285

Administrators Appointed
Capital Physio Limited    08954715
CNG Electricity Limited    09263237
Go To Energy (UK) Limited    9844990
CNG Energy Limited    03869419
Pure Planet Limited    09735688
Radio Physics Solutions Limited    06768053
Social Energy Supply Limited    10300609
Symbio Energy Limited    07999360
Compulsory Liquidators Appointed s 136
Grindlay Taylor Real Estate (Weybridge) Limited    09530318
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Mobility and Care Services Limited    10261423
Liquidators Appointed
Active Games Design Limited    04362619
B1 Car Repairs Limited    11717768
Basildon United Football Club Limited    11861699
Childcare International Limited    02752378
Delta Star Energy Limited    11081582
Eco Washroom Solutions Limited    12063445
Green Hut Energy Limited    09095755
House of Health & Beauty (Dorchester) Ltd    08353288
Magnus Language Training Limited    00846378
Teddy Bears pre-School, Boxford    1174843
Venture Airport Parking Limited    11851464
Wellington Commercial and Domestic Services Limited    07577534
Members Voluntary Liquidations
Lifestyle Care Management Limited    09662234
Parkhouse Dental Practice And Cosmetic Centre    07026059
Petitions to Wind Up
Ravenside Pre-School    CE002462 
Signature Litigation Victims Group Limited    06853408 
Winding up orders
Community R4C Limited  


Types of Insolvency

Administration applies to limited companies and partnerships and is intended to get the company out of trouble and trading again if possible. Administrators can be appointed to a company that is unable, or is likely to become unable, to pay its debts. They can be appointed by the courts (on application from a creditor, directors or partners), the holder of a qualifying floating charge over the assets of the business, or the company or its directors. An administrator’s primary goal is to rescue the company as a going concern. If this isn’t possible, the administrator will try to get a better result for the creditors than would be possible if the company was wound up. If neither of these is possible, the administrator will sell the company’s property to make at least a partial payment to one or more secured or preferential creditors, such as employees or the bank.
Administrators Meetings Para 51
This statement by the administrator of his proposals must be accompanied by an invitation to an initial creditors’ meeting (Sch B1, para 51(1)).
This can only apply to individuals (including sole traders and individual members of a partnership). Bankruptcy petitions may be presented to the court by the individual, by creditors who are owed £750 or more, or by the supervisor of an individual voluntary arrangement. A bankruptcy order is made by the court.
Company Voluntary Arrangement (CVA)
A company comes to an arrangement with its creditors to pay the debts in full or in part over time. A CVA begins with the company (or its adviser) drafting a formal proposal at a Creditors’ Meeting to pay part or all of the debts. If the proposal is accepted by the creditors, the arrangement will become legally binding and the directors will retain control of the company.
Compulsory Liquidation
This is the winding up of a company or a partnership by a court order (a winding up order). A petition is normally presented to the court by a creditor stating that he or she is owed a sum of money by the company and that the company cannot pay.
The Official Receiver becomes liquidator when the order is made but an Insolvency Practitioner will be appointed to take over if the company has significant assets. The liquidator’s role is to realise the company’s assets, pay all the fees and charges arising from the liquidation, and pay the creditors as far as funds allow in a strict order of priority.
Compulsory Liquidators Appointed S 136
When a winding-up order has been made, the Official Receiver is initially appointed as liquidator (section 136, IA 1986). The company’s creditors and contributories may appoint another individual, who must be a registered insolvency practitioner, to act as liquidator (section 139, IA 1986). More than one liquidator can be appointed to act jointly.
Creditors’ Voluntary Liquidation
Here the shareholders pass a resolution to wind the company up without the need for a court order. A Creditors’ Meeting is held to nominate the appointment of a liquidator and consider a statement of affairs. Creditors can appoint a committee to work with the liquidator, whose role is to realise the company’s assets, pay all the fees and charges arising from the liquidation, and pay the creditors as far as funds allow in a strict order of priority.
Creditors’ Voluntary Liquidation Deemed in Consent Meeting
Creditors are now ‘deemed to have consented’ to a decision or resolution if 10% of creditors (by value) have not objected to it. In other words, if objections are not received by the specified decision date, creditors are ‘deemed to have consented’ to the decision or resolution.
Individual Voluntary Arrangement (IVA)
An individual comes to an arrangement with creditors to pay his/her debts in full or in part over time as an alternative to bankruptcy. The arrangement is set up by a licensed Insolvency Practitioner who will put it to a meeting of creditors. If the proposal is accepted at the meeting, the agreement reached with the creditors will be legally binding. An Interim Order is sometimes issued by a court and will immediately protect the debtor from any legal action by creditors.
Petitions to Wind Up
A winding up petition is a legal notice put forward to the court by a creditor. The application, in effect, asks the court to liquidate the company as they believe the company is insolvent. Proceeds of the liquidation can be used to pay back creditors.


For information on ICSM visit www.icsmcredit.com or call 0844 854 1850.
ICSM, The Exchange, Express Park, Bristol Road, Bridgwater, Somerset TA6 4RR. Tel: 0844 854 1850. www.icsmcredit.com. Ian.carrotte@icsmcredit.com


Tel 0844 854 1850 ___ Fax 01454 327 355
Privacy Policy   © ICSM All Rights Reserved