Liquidator
A Liquidator is appointed either voluntarily by the company or officially by the Court to guide a company through liquidation, much like a trustee would guide a company through bankruptcy. A Liquidator will conduct a thorough investigation of the company’s financial position to determine whether or not it is insolvent. There are a number of ways a company can enter into liquidation, however they all have the same aim: to liquidate the company assets in order to meet the debt owed to creditors and distribute any remaining funds to shareholders.
A company may choose to appoint a liquidator voluntarily when the members agree that even though the company is not insolvent, winding up the company is in the best interest of its members and shareholders. Alternatively, creditors may make an application to the court with the intention to prove that a company is trading while insolvent and cannot repay the amount debt owed to the creditors. To avoid court proceedings; the shareholders, as creditors, also have the option to voluntarily appoint a liquidator if the company is insolvent.
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All three options result in the appointment of a liquidator who is tasked with investigating the company’s financial position. After the Liquidator has realised all assets, made all recoveries, made all distributions to creditors, conducted all relevant investigations into the financial affairs of the company, made distributions of surplus to shareholders, reported to the Australian Securities and Investments Commission (ASIC) and creditors on their findings, they will then make an application to de-register the company which is the final step of the process.
More information about a liquidator’s role can be found on the Liquidator’s Role page of our website. Call us now to take advantage of our free, no obligation initial consultation. For further advice about whether or not liquidation is the right option for your company, contact one of our professional consultants at Insolvency Advisory Accountants today.