If a company is experiencing cash flow problems, can’t meet its debts or pay its bills as and when they fall due then a Voluntary Administration might be the answer.
 
A Voluntary Administration is the process of appointing a voluntary administrator to a business in an attempt to restructure the financial affairs of that business.
 
The administrator works closely with the directors to explore the company’s options, these options include:

• Resolve the necessary issues and return the company to the directors.
• Enter into a Deed of Company Arrangement.
• Sell the company.
• Place the company into liquidation.

Some companies enter into Voluntary Administration in an attempt to stop the directors from becoming personally liable for the debt and to attempt to keep the company from going into liquidation.
While the company is in administration:

• Creditors who hold a personal guarantee cannot take any action against the guarantor without court approval.
• An application to the court to wind up the company cannot be commenced.
• Owners of property or equipment used by the company cannot be called upon.
• A creditor cannot enforce any claims against the company without the approval of the administrator or the court.

To find out more about voluntary administrations click here