Licensed Insolvency Practitioners
Licensed Insolvency practitioners assist both insolvent companies or private individuals who are in difficulties financially.
Here at HBG Advisory, we help directors who are dealing with the pressure of their company entering insolvency.
For a no-obligation free chat, please call 0800 612 5448.
So then, What is a Licensed Insolvency Practitioner?
A licensed insolvency practitioner (IP) operates within the UK. They deal with aspects relating to financial issues.
They assist company directors by way of advice on potential pre-insolvency matters relating to their companies. Then first establish the position financially of the company Rescue of the company along with jobs and creditor protection, remains their primary aim.
However, if not possible and the company appears insolvent, then
the IP may, by the directors take the appointment, to act as Liquidator via a process known as a Creditors Voluntary Liquidation.
Searching for an Insolvency Practitioner?
You can use the internet to find licensed insolvency practitioners; talk with your accountant also.
How do Licensed Insolvency Practitioners Work?
Licensed Insolvency practitioners remain as a professional intermediary in insolvency proceedings. As regulated authorised professionals, creditors of the failing company feel assured that the presence of IP’s will ensure the end game. An insolvency practitioner operates by a code of conduct providing qualified, ethical, professional direction.
So then, an IP must take every care and adopt high skill, ensuring interests of the creditors along with the company are dealt with by Insolvency law.
Upon the IP recommending a liquidation, then once appointed, they remain required to manage the process and assume the role of appointed Liquidator of the failed company.
What therefore is a Liquidator?
Insolvency practitioners and liquidators remain the same in description. Once directors of the company determine they wish to liquidate the company. Then they are required to choose a suitable IP. The IP then carries out the necessary procedure on the directors part.
Once appointed, the IP liquidates the company, and the IP remains referred to as The Liquidator. Part of the liquidator duties remains to sell assets so they may distribute funds to creditors of the former company.
However, not just IP’s act as company liquidators. If a company enters a compulsory liquidation, then the courts appoint the official receiver on the back of a winding-up order. Therefore, the designated official receiver may then select an independent licensed insolvency practitioner to carry on with with the position of Liquidator if needed. They are referred to as a liquidator appointment, on behalf of the Secretary of State. However, creditors of the company may collectively vote to have their appointed IP if they believe a better outcome may be achieved.
Who then Chooses a Licensed Insolvency Practitioner?
- Any Director of a Limited Company;
- Creditors of the company;
- The Secretary of State;
Is a Liquidator an Insolvency Practitioner?
How do Licensed Insolvency Practitioners Charge?
IP’s are required legally carry out duties responsible and maintain transparent at all times regarding their fees and clearly outline how they charge their time.
Professional fees charged remain subject to the approval by creditors, valued on-time cost basis or fixed price.
Times when you use a Licensed insolvency practitioner
During your normal day to day business activities, you would not consider visiting or using a Licensed Insolvency Practitioner to help with your business or your own personal financial affairs.
However, once your business enters insolvency, or you do personally. Then you need to understand the difference from when the official receiver is appointed and then why and how a Licensed Insolvency Practitioners need appointing.
A licensed Insolvency Practitioner in the UK is used to carry out, be appointed and manage the following insolvency procedures.
If your company remains solvent and you wish to close it down utilising tax benefits, then a solvent liquidation exists:
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