Business Administration FAQ
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Administration FAQ
Administration is a process that refers to the arrangement of external help for an enterprise if it is struggling with the payment of arrears. If you are running a company with debt problems, an insolvency practitioner may advise putting your company into administration. If this happens, then an administrator will be brought in to examine the state of your enterprise. The administrator will question the debts, assets, cash flow, business model, and viability to trade. Your company can continue to trade when under administration, but the control will be in the hands of the administrators rather than in the hands of the directors or stakeholders.
If you are new to the concept of administration, it can seem scary, especially if you have spent all your working life building up a company. However, The Boardroom Punks want to reason with your concerns. We have a top list of questions commonly asked about administration. These should give valuable insight into the process and whether it is something that can help you. If you need advice tailored to your enterprise, book a free, confidential call with us today. The Boardroom Punks have helped clients wipe off 80% of their debt, and there is no reason why we cannot do the same for you.
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Administration FAQs with Scotland’s Finest - The Punk way
Can creditors still pressure me over debt whilst my company is in administration?
Whilst in administration, your company will be protected from legal action by creditors. Nobody can apply for a winding-up petition whilst your company is registered under administration. The creditors will be informed regarding the state of administration.
What will an administrator look to do to save my company?
There are various options an administrator will explore. They will analyse a company’s cash flow, its commercial viability, the size of the outstanding debts, and the length at which the company has been operating. If it is possible to save your company, an administrator may look to negotiate a Company Voluntary Arrangement (CVA) with the creditors. They may even look to negotiate a pre-pack sale or a pre-pack administration with existing shareholders or those who express from outside the company. If the debt cannot be repaid, an administrator may liquidate the company, meaning the assets and property will be sold off to pay the creditors. The Boardroom Punks approach every case with the incentive of saving the company, and liquidation will not be entertained until every other alternative has been explored.
How long does administration last?
Once administration is announced, and the correct administrator is appointed, they will have 12 months to come to a solution. Administration will automatically end after this period. However, if the business needs additional time, then the administrator can ask the court or creditors for an extension.
What is the difference between administration and pre-pack administration?
Administration is the process by which someone who oversees the company’s financial direction is appointed. In contrast, pre-pack administration specifically aims to sell a company’s assets to other shareholders. Whilst a pre-pack sale may be negotiated when a company is in administration, this will not be the only option explored.
Will my company be liquidated whilst it is in administration?
A list of registered insolvency practitioners can be found at gov.uk. However, you are likely to want a different approach than your typical practitioner. We are trusted with administration services for small and medium enterprises. The Boardroom Punks will innovatively approach your company, ensuring that alternatives are offered.
Who can be trusted to conduct the process of administration?
The typical insolvency practitioner may consider liquidation among all the other administrative practices. However, at Boardroom Punks, we apply an innovative approach to business. We will look the rescue your company and try every method before liquidation will even be discussed. Though it is a reality, it will only be entertained after all the alternatives have been tried and tested. We have a great track record with saving companies, and we want you to approach us in confidence.
What if I decide to reject the proposals of administration?
A majority of a board of directors must agree to undergo the administration process. If you are your enterprise’s sole director, then the decision is likely with you. Our methods are geared toward rescuing your company. However, if you do decide to go it alone to try and fix your debt, then you may run into problems later down the line. It may be cheaper in the short term to reject our proposals, yet it may lead to the ruin of your company. We are safe pair of hands when it comes to administration, and we are consistently communicative with our clients during the process.
How do I appoint an administrator?
To appoint an administrator, there must be evidence that the debts accrued cannot be paid off independently. A creditor or HMRC may request a company to go into administration, but it is much more likely that the company itself will decide upon administration. If you are ready to salvage your company, give us a call today. All details are confidential, and even if it is just to get more advice, the Boardroom Punks will be happy to assist you further.
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