Creditors Voluntary Liquidation

Definition:
Creditors voluntary liquidation is instigated by the directors of the company calling a meeting of the board to discuss and consider the financial circumstances of the company.

If as a consequence of that meeting the directors are satisfied that the company is insolvent and cannot continue to trade they should resolve to call meetings of both the Shareholders and the creditors to consider said financial position and to appoint a liquidator. As the shareholders meeting precedes the creditors meeting it is their nominee as liquidator whose appointment must be endorsed or rejected at the subsequent creditors meeting.
To reject the shareholders or company nominee and replace him / her with a creditor nominee will require that the majority in value of the creditors validly voting at the creditors meeting vote in favour of their Nominee.

If you are confronted with insolvency, either as a director or shareholder in an insolvent company or as a concerned creditor, Mazars insolvency services department can advise you pragmatically and professionally on your rights, duties and responsibilities and the course of action you should take to discharge properly your responsibilities.

The services that Mazars provides in the area of creditor voluntary liquidations include:

  • Advising directors and shareholders on the proper procedures to be adopted in discharging their statutory responsibilities
  • Assistance with the preparation of the statement of affairs, the calling and conduct of the various meetings
  • Advice and assistance to creditors including representation at creditor meetings and reporting on conduct / outcome of same
  • Acceptance of appointment nomination by the company and, if so appointed, dealing with all aspects of the insolvency including - asset realisations, quantification and prioritisation of creditors, employee claims, retention of title, ODCE reporting, etc

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