KEEPING YOU INFORMED • Company Voluntary Arrangements • Individual Voluntary Arrangements - Consumer Debts • Liquidation • Individual Voluntary Arrangements - Business Debts • Administration • Bankruptcy Appointments | email: Griffin & King, 26-28 Goodall Street, Walsall, West Midlands WS1 1QL No. Definitely, no! I recently had an enquiry from a director of a company that was insolvent. The director had spoken to her accountant and they had come up with the a plan to deal with the company; no further trade would be put through the company, debtor monies received would be used to clear the overdraft and as many trade creditors as possible, employees dismissed and told there were no funds to pay any entitlements, HMRC debts would not be paid and the striking off procedure commenced! I didn’t know where to start! Besides preferences, transactions at undervalues, breach of fiduciary duty, there was a potential for an unlimited fine, and potentially liable to imprisonment up to seven years and up to a 15-year ban as a director if found guilty of this offence! The guidance from Companies House states ‘this procedure is not an alternative to formal insolvency proceedings where these are appropriate’. Even if the company is struck off and dissolved, creditors and others could apply for the company to be restored to the register. There are strict circumstances that need to exist before the directors (or a majority of directors) can make application - the most important of which are that the company has not traded, changed its name or engaged in any other activity other than being Contd. Pg 2 CAN A STRIKING OFF PROCEDURE BE USED AS AN ALTERNATIVE TO A LIQUIDATION? BUSINESS RESCUE, RECOVERY AND TURNAROUND News and views from the Griffin & King team SPRING/SUMMER 2019 Management team: Janet Peacock, Cheryl Gray, Tim Corfield, Emma Wallis, Mark Shaw. Download a copy by Tim Corfield DEBT CHARITIES - GOOD ADVICE? Page 2 RECENT TESTIMONIALS Page 3 STRIKING NUMBERS Page 3 THE LAST WORD Page 4 COMPETITION TIME Page 4