A creditors report is a statutory report which must be prepared and issued to creditors within 3 months of the liquidation of a company. The creditors report will contain both financial and non-financial information.
The purpose of this report is to provide creditors with:

• Details of the estimated assets and liabilities of the Company;
• Details of the inquiries the liquidator has made relating to the winding up of the Company to date;
• Details of further inquiries the liquidator intends to make relating to the winding up of the Company that may need to be undertaken;
• Details of what happened to the business of the Company;
• An update on the progress of the liquidation;
• Details on the likelihood of creditors receiving a dividend before the affairs of the Company are fully wound up; and
• Details on the possible recovery actions.

A copy of the report must be lodged with ASIC. You can obtain a copy by paying a relevant fee and searching the ASIC registers or if you are a creditor the liquidator will provide it free of charge.

Other reports

The liquidator must also prepare and submit a confidential report with ASIC but this report will not be released to creditors.

Requests for information

Creditors can also request for information to be provided from time to time as along as the requests for information are reasonable requests. The liquidator must provide the information within 5 business days.

If you, as a director of an insolvent company, have decided to initiate a voluntary wind up of your company, you have the option of selecting a liquidator of your own choosing. To better understand of the liquidation process, call Australian Company Liquidations today on 1800 981 070 and we will start your liquidation within 24 hours.

At Australian Company Liquidations, all we do is company liquidations. As such, we have a simple liquidation process to make it easier for us to help you. We have a highly skilled team with years of experience in corporate insolvency cases. We constantly refine our work practices to achieve significant cost savings which we pass onto you!

VIEW OUR SIMPLE THREE STEP COMPANY LIQUIDATION PROCESS:

• Contact us with your ACN details with a list of assets and creditors;
• We will then email you with appointment documents to be signed by your company’s director/s and shareholder/s; and
• We will then place your company into liquidation within 24 hours and notify your creditors on your behalf!

If your business has assets which can be sold by the liquidator to fund the cost of the liquidation we will not charge you any up-front fee.

If your business has no assets to pay for the cost of this simple liquidation, we can offer a low cost payment which will be a contribution towards the costs and expenses of the liquidation. This contribution is fixed so if we incur more fees during the course of the liquidation you will not be responsible to pay them.

Call us now on 1800 981 070 to discuss your situation so we can tailor a suitable package to meet your needs. You can even make the first enquiry on a confidential basis. We are happy if you want to remain anonymous until you feel comfortable to proceed with this simple company liquidation.

The scale of bricks and mortar stores collapsing has caused concern across several industries. In wake of the retailers and food chains that have entered into voluntary administration or liquidation, the future of physical stores have been called into question.

The changing landscape of bricks and mortar retailers has marked the collapse of many well known names – including Pumpkin Patch, Marcs, and David Lawrence. The rise of e-commerce websites has allowed quick and easy shopping, setting online stores apart from their physical counterparts.

With the arrival of Amazon into Australia as well, e-commerce retailers will continue to thrive on the irreversible revolution of online shopping.

Food chains such as Max Brenner have also gone into voluntary administration. Amidst the changing landscape of consumer demands, celebrity chef Jamie Oliver’s six Italian chain restaurants have also collapsed in April this year.

The introduction of apps such as Uber Eats, Deliveroo and Foodora have significantly altered the food industry. The need to meet instant demands has caused a shift towards the instantaneous nature of delivering to the customer’s wishes.

With the growing trend of convenience and instant gratification, consumers are constantly looking for the next quickest option, leaving bricks and mortar operations to shrivel as they fail to innovate and adapt to changing customer demands.

If you would like more information on company liquidations, or are considering one yourself, then please contact Australian Company Liquidations. We are registered company liquidators who offer a FREE 24/7 insolvency hotline for Australian directors seeking expert advice. Please call us on 1800 981 070 now.

The Safe Habour laws came into effect in 2017. However, if you are still unsure about how they may help you, or if you are concerned about the liquidity and solvency of your company, then our experts at Australian Company Liquidations are here to help.

The Corporations Act 2001 (Cth) states that it is the director’s duty to prevent the company from incurring further debts once the company is insolvent. A company is considered to be insolvent when it cannot pay back its debts as and when they fall due. If the director does not prevent the company from incurring further debts and they remain unpaid, the director can be held personally liable for the debts if the company is later placed into liquidation.

The safe harbour laws may protect company directors from a claim for insolvent trading if a suitable safe harbour plan is put into place by an approved professional. The plan must provide for a better outcome for their company, compared to the immediate appointment of an administrator or a liquidator.

Safe harbour will end if any of the following occurs:

• The director stops taking the course of action as outlined in the plan;
• The course of action stops being reasonably likely to lead to a better outcome for the company; or
• After starting to develop a course of action, the director fails to take the course of action within a reasonable period after that time.

You should seek professional advice immediately if you are concerned about the solvency of the company to which you are appointed. Contact Australian Company Liquidations 24 hours a day / 7 days a week on 1800 981 070.  We offer free and impartial company liquidation advice.

We all know that a high director’s salary is worth all the hours of hard work you put into your company. But if your company has just started, how much should you pay yourself? Will you make a profit to cover the salary you’re expecting? Should you receive a salary during the start-up phase of your company or is it best to reinvest your salary in the company?

As a company director, you need to make sure there is enough money to grow the company while covering costs. But you may also need to draw a salary to cover your personal living expenses. The perfect balancing act.

Before setting your salary you will need to calculate what profit you expect to make. Your salary should be less than the expected profit just in case the company does make the profit you estimated. When calculating the expected profit make sure that you allow enough money to pay all taxes and employee entitlements. If you pay yourself a salary which ends up being more than the profit then you may need to pay some back unless the company has other reserves. If you don’t ensure that the company makes a profit and you incur debts then you will most likely become personally liable for incurring the debts. This is called insolvent trading

How will I pay myself?

 You can register yourself as an employee of the company.

If you register yourself as an employee of the company and you pay yourself a regular salary then the company will need to withhold PAYG tax from your salary and remit that tax to the Australian Taxation Office (ATO). This is the most common and efficient method for a director’s salary to be paid.

Directors Loan:

If you don’t pay yourself a regular salary (due to unpredictable company cash flow), then you can pay yourself through a loan account. Your accountant will then need to work out the PAYG liability each quarter so this can be included in your BAS return.

Shareholder dividend:

If you also own the shares in the company then you can pay yourself a dividend from the profits each year. If you can wait until the end of the year to be paid, then you can set the dividend in accordance with the profits. This is the safest method as you can only pay dividends from profits. You will then need to include the dividend you received from the company in your personal income tax return.

We always recommend that you seek professional advice from accountant before If you declare any company dividend.

The team at Australian Company Liquidations can assist you if you are concerned about the solvency of your company. We have friendly and professional consultants ready to assist you now. Our phone lines are open 24/7 so there will always be someone available to speak to you at any given time, so please call us on 1800 981 070 now.

Is company liquidation a threat that is starting to become all too real? This article will explain two simple steps you can take to avoid the threat of a company liquidation.

1. Identify opportunities where you can increase cash inflow

Too often, company directors are in possession of surplus stock or occupy surplus space. This means that they are missing out on opportunities to increase their cash flow and make a little extra income.

We recommend that all company directors evaluate their stock levels and other underutilized assets. If stock levels and underutilize assets can be sold, company cash flow will improve. Even if this is temporary selling excess stock or subletting surplus space will allow company directors to pay off company debts.

Another way to increase cash inflow is by ensuring that you are sending out invoices to customers immediately and enforcing a vigorous payment process to make sure you get paid in a timely manner. This may include setting up an automated system that sends out payment reminders and enforcing late or dishonour fees. This will act as a great incentive for your customers to pay their fees on time so that you do not need to wait for delayed payments which will really disrupt your cash flow.

2. Eliminate cash outflow where possible

While it is helpful to increase income in your company, it is also vital that you reduce expenditure where necessary.

Some ideas include:

• Moving to a smaller office with lower rent
• Reducing overhead costs
• Changing to a cheaper or more efficient electricity or telephone bill
• Cutting down on staff hours during quiet periods
• Shopping around for better deals with suppliers
• Evaluate your inventory control and ensure that you are not buying more stock than necessary

By following these two steps in your business operations, you can free up cash flow to repay company debt. Hopefully these measures will also help you avoid the threat of a company liquidation.

If you would like more information on company liquidation, then please contact Australia Company Liquidations. We are registered company liquidators who offer a FREE 24/7 hotline for Australian directors seeking expert advice. Please call us on 1800 981 070 now.

What is a Company Liquidator?

When considering a company liquidation, many people can confuse the roles of liquidators and administrators. In order to solve this misconception, we’ve put together some key points to help you differentiate.

What is the Purpose of a Liquidator?

Company liquidators are responsible for the entire process of a company liquidation. This includes selling the company’s assets and distributing any surplus funds to creditors in accordance with the priorities set out in the law.  Liquidators must ensure the most cost-effective outcome for all stakeholders.

What is a Liquidator’s Role?

The role of a liquidator differs to an administrator. Liquidators must investigate the cause of the company’s failure and report their findings to the Australian Securities and Investment Commission (ASIC). After the ASIC considers such report, they will either commence further enforcement action or they will issue a clearance to the liquidator.  A liquidator’s investigations will include a report on any potential claims for preferential payments, insolvent trading or any other director related transactions. The liquidator’s main role is to sell the company’s assets and distribute the surplus funds to the company’s creditors. Liquidators are required to act without any bias and with independence.

What is an Administrator’s Role?

Administration is one step before liquidation. Administrators are appointed to companies in financial distress so as to give the company an opportunity to develop and implement a restructuring plan with creditors. This is called a “deed of company arrangement” (DOCA). The role of an administrator is to compare the outcome creditors would receive under the proposed DOCA to what creditors would receive in liquidation.

Who Can Be a Liquidator?

Liquidators are usually accountants in practice who have studied both accounting and law and have extensive experience in the insolvency industry.

At the Australian Company Liquidations we have 2 in house company liquidators ready to assist you with your company liquidation.

If you are company director and you are considering an administration or a company liquidation, then call us now.  We have a team of highly skilled and friendly accountants ready to assist.

To better understand which option is better suited for your company, call Australian Company Liquidations today on 1800 981 070.

Have you ever considered the process of asset sale before or during liquidation? It is not as straightforward as you may have thought, so we have come up with a short list of issues to consider.

1. Sale of assets at “market value”.
   

When any company assets are sold during liquidation, the liquidator will most likely need to obtain an independent valuation of those assets before going ahead and selling the assets. The reason is that the liquidator has a duty to sell assets at the market value or if a market does not exist then at the best price that can be reasonable obtained.

2. Tax Implications
   

When company assets are sold during liquidation, the liquidator will still need to collect any GST on the sale and remit the GST to the Australian Taxation Office (ATO). If the asset has been sold at a profit then the liquidator, may also need to report the capital gain to the ATO and pay any tax.

3. Depositing money from asset sales into the Company’s Bank Account.

All funds received from the sale of company assets during liquidation must be paid into a bank account controlled by the liquidator on behalf of the company. If a company director or another agent sells any assets of the company on behalf of the liquidator, then the funds still need to be paid into a bank account controlled by the liquidator.  The Liquidator will then disperse the funds in accordance with the law.

This is a complex area of the law and that is why liquidators need to be qualified accountants and registered with the Australian Securities and Investments Commission. At Australian Company Liquidations we have our own in-house registered liquidators who can wind up your company and sell off any assets and comply with the laws. We have friendly and professional consultants ready to assist you now. Our phone lines are open 24/7 so there will always be someone available to speak to you at any given time, so please call us on 1800 003 883 now.

‘Phoenixing’ is when directors transfer assets from one company to another for inadequate consideration and then liquidate the company which has all of the unpaid debts left in it. The new company typically uses the same or a similar name to the old company. This is a deliberate attempt to avoid paying their creditors. Such activity affects a range of individuals, including employees, trade creditors and the Australian Taxation Office.

We have written in depth about this issue earlier this year in July. Click here for more information.

According to a new report, phoenixing costs the Australian economy an estimated $3 billion per year. This reform proposes enhanced methods of identifying such activity.

Firstly, mechanisms will be put in place to detect companies and directors who, in the past, have displayed phoenix-type behaviour and characteristics. Additionally, such companies and directors would be labelled as a “Higher Risk Entity” (HRE). This declaration, by the Commissioner of Taxation, means that the HRE will be regarded as a “High Risk Phoenix Operator” (HRPO).

The failure to pay taxes on time and to deliver proper company records, may be indicative of phoenixing activities. This could result in a company director being declared as a HRE, and may lead to civil and criminal penalties.

If your company is insolvent or likely to become insolvent, then act immediately by seeking the help from professionals. Australian Company Liquidations can assist you in shutting down your failed business the right way. Call us on 1800 981 070 for a FREE initial consultation now.

As a company director or owner, it is important that you keep an eye out for signs that your company may be insolvent or likely to become insolvent. This will prevent your company from trading whilst insolvent which can bear serious consequences.

Here are four signs that your business is headed towards company insolvency:

1. Ongoing losses

If you find that your business is constantly losing more money than it is making, then that is a sure sign of company insolvency. Without making a profit, a business cannot survive in the long run.

2. Bookkeeping records not updated

Another sign of company insolvency is poor financial records. One of the first signs that a company is struggling is when records are not kept up-to-date because the focus will most likely be on other tasks as opposed to bookkeeping. The Corporations Act states that this creates a statutory presumption of company insolvency.

3. Delayed superannuation contributions

One of the warning signs is delayed superannuation contributions. One of the reasons why struggling businesses delay superannuation payments is because these fees are only paid every few months so it is less noticeable if they are late. Not only is this an indicator of company insolvency but it also can cause a director to become personally liable for these payments.

4. COD Terms

If your suppliers or vendors suddenly implement cash-on-delivery (COD) terms on your arrangements then that is a signal of company insolvency. It shows that you had not been able to make payments by the agreed terms previously and this has raised concerns that you will not be able to pay for your products and or services on time.

If you have or are experiencing any of these four signs of company insolvency, then take action immediately. Delaying taking the appropriate steps to help your company can bear serious consequences for your business and for you as the director. Seek professional help from a reputable company that can assess your situation for you and help you make the best choice such as Australian Company Liquidations. ACL offers a free consultation to help directors who are facing company insolvency. Call us on our 24/7 toll-free hotline to speak to one of our fully licensed liquidation practitioners now.