Administration

What is Administration?

If your company is insolvent, or likely to become so, this procedure places it under the control of an insolvency practitioner and the protection of the court. The reasons for doing this are to:

• rescue the company as a going concern, or
• achieve a better result for creditors than they'd get if the company was wound up, or
• realise property in order to make a distribution to secured and preferential creditors.

While your company is in Administration your creditors are not able to take action against you unless they have permission from the court.

An Administrator may be appointed by:

• Court Order
• your company or fellow directors without a Court Order, or
• a secured creditor without Court Order.

What do I have to do?

In order to appoint an Administrator you need to provide them with information regarding assets and liabilities. As a director, you need to sign a Notice of Intention to Appoint. You must co-operate with the Administrator and provide them with the information they require.

How will Armstrong Watson help?

When we are appointed Administrators of your company, our powers will be very broad. Your company’s assets will be realised by us, and we will take over the board of directors' management function and will have the authority to remove or appoint directors.

Our duties include:

• Filing necessary documents with the court
• Dealing with any charge holders
• Effectively managing the business while seeking a purchaser
• Dealing with sale of assets
• Liaising with creditors, calling a creditors’ meeting and dealing with correspondence
• Dealing with employees and their potential claims
• Dealing with any company pension scheme
• Preparing proposals and reports for approval by creditors
• Dealing with all paperwork.

How long does Administration last?

Administration must be concluded within one year. However, this can be extended with the agreement of the creditors or permission of the court if more time is needed. The Administration can also come to an end if the Administrator decides that its aims have been, or cannot be, achieved. How much does Administration cost?

As Administrator, we will be paid out of the asset realisations. Actual costs depend on the complexity of the case and how long the Administration lasts.