Business Debt in Australia
In Australia’s challenging economic climate, even the most successful business can fall prey to volatile market conditions and cash flow pressures. In these situations, it is vital to identify, assess and respond to the signs of company turmoil to give your business the best chance of survival.
By engaging us at Revive Financial, you can take a step back from your company and breathe easy while our experts work out the best way forward. We can assist you with a wide range of formal and informal insolvency options to help turn your business around.
Early Warning Signs of Insolvency
Inability to Access Finance
When obtaining loans and finance, you generally want the lowest interest rates provided by the best lenders. However, if you’re being forced to look at alternative financing because the banks deem you too risky, this is a sure sign of insolvency.
Poor Cashflow Management
If your business fails to manage cashflow strategically, it could lead to catastrophic events. This includes losing major customers, paying increased interest rates or correcting ineffective control systems.
Disorganised Business Records
If you’re finding it hard to prepare accurate financial statements for your business because your files are disorganised, this is a worrying sign. Poor organisation can mean poor financial and business management.
Inadequate Cash Reserves
It’s important to have cash reserves in place to deal with unexpected events, fund growth strategies and leverage opportunities as they arise. If there is no cash reserve, your business may be experiencing financial difficulties.
How to Reduce Your Business Debts
Prioritise Your Debts
If your business debts are spiralling out of control, our team can help turn your business finances around with a professional debt relief strategy and action plan.
Take Action Now
It’s important to tackle your business debts head-on. The longer you leave it, the harder it will be to resolve and the less options available to help your company survive.
Assess Your Finances
Make a list of all the money you owe and that you are owed so you can assess your company’s financial situation. Consider hiring an accountant or bookkeeper.
Contact Your Bank
Often banks are able to provide assistance if you’re struggling financially. Contact your bank to discuss your situation and options that may be available.
Negotiate with Creditors
Get in touch with your creditors and let them know about your company’s current financial situation and that you’re struggling with debt. You may be able to negotiate a payment plan.
Chase Up Unpaid Invoices
Following up on late payers or non-paying customers can potentially bring in some much-needed income to help the company survive.
Worried about trading insolvent? Get in touch with our professional team today to find out your options.
How it Works
If your company is found to be insolvent, you’re no longer legally allowed to conduct business and the company must be wound up.
If your company is found to be insolvent, you must appoint a Liquidator to wind it up. The liquidator will take control of your company and begin to sell the assets, giving money from the sale to your creditors. Speak to us at Revive Financial about appointing a Liquidator. We will be able to advise you on your company’s situation and the potential costs involved.
Once the Liquidator has finished their Liquidation process, they’re required to lodge the Notion of Final Meeting Convened by Liquidator to complete the process. When it gets to this point, your company has officially been wound up.
Why Choose Revive Financial?
Revive Financial is an Insolvency Practitioner you can rely on for professionalism, honesty and experience. We won’t offer generalised advice or a one size fits all solution. Revive Financial takes the time to learn about you, your business and your struggles to properly advise you on the best way forward.
Revive Financial aims to help save your company from financial disaster and declaring bankruptcy. Our team has experience helping small, medium and large businesses from a diverse range of industries.
Our team knows time is of the essence when it comes to business debt and a fast solution could be the difference between keeping or losing your company. Our expert financial specialists have years of experience assisting companies with financial hardship and we pride ourselves on being able to adapt quickly to provide the most relevant and up-to-date advice to companies in financial distress.
Kym
“Very professional and understanding, took the pressure off me when I needed. Also very quick to finalise everything. Would definitely recommend them.”
What Makes Us Great
In-house ASIC Registered Liquidator
In-house ASIC Registered Bankruptcy Trustee
CPA and CA Qualified Accountants
Professional Members of TMA
Professional Members of ARITA
Rated 4.9 out of 5 on Trustpilot
Not sure if Company Liquidation is right for your business? Get in touch with our business debt specialists today for a free business health check and analysis.
Company Liquidation FAQs
The time it takes to complete a Company Liquidation will vary depending on how complicated the company’s affairs are. There is no set time limit with which the Company Liquidation needs to be completed and as such, it can range from 12 to 18 months (for an average-sized company that is fairly uncomplicated) to longer (if the company’s affairs are complex). The main factors that affect the time-frame of the Liquidation are the structure of the company, its dealings prior to being liquidated and whether it will be necessary to litigate.
You have the same duties and obligations during the Company Liquidation period as you had prior to the Liquidator’s appointment. In addition, you must:
- Provide the Liquidator with a report as to the affairs of the company,
- Provide all of the company’s books and records to the Liquidator, and
- Reasonably assist the Liquidator in carrying out his or her role.
The priority for payment of proceeds in a Company Liquidation is generally as follows:
- Costs and expenses of the Liquidation, including the Liquidator’s fees,
- Secured creditors,
- Employee claims, and
- Unsecured creditors.
Credit reporting bureaus do keep track of companies that enter Company Liquidation and the names of the directors of those companies. The ‘mark’ on your credit report is there, but it is unlikely to affect you if you’re applying for personal credit. For example, if you want to apply for a credit card or personal loan, it generally won’t be an issue. However, if you want to apply for a business loan, it is much more likely the ‘mark’ will be found.