There is a common belief that Insolvency Professionals (IPs) are only needed when a company is insolvent, but this is not accurate. There are many functions that the IP can perform and this includes advising directors even when the company is solvent but they need to manage the fortunes and trade profitably once again.
When a company is threatened with legal action by creditors or when there are some temporary cash flow problems then you should get professional advice and this can make things better for the company. It is important that you work as quickly as possible to avoid long-term problems. Under the circumstances, you shouldn’t delay because when you act as soon as you notice something isn’t right, there are many options that will open up and may include:
- voluntary liquidation
- Sale of assets to direct more cash into the business.
- Company restructuring
- selling business
If a company had been trading profitably before and if the business is fundamentally sound, a licensed IP may offer the best chance of survival. The financial problems you may be dealing with can be really simple, like unexpected bills, or perhaps you’ve lost a customer just in bankruptcy or a market crash. This can affect trading and you may not pay vendors as expected. An IP can advise a company or person that is going through difficult times. They can identify and then present you with all the options that can help you restructure and recover. They pay attention to any business goals you may have.
Help in practical terms
The IP is capable of negotiating with creditors for the client. They will offer all the options and then recommend a course of action that is best for the company or business in the circumstance.
The practitioner also involves creditors in professionally conducted negotiations and instills a level of confidence in the company’s long-term responsibility to settle all invoices. Most likely, creditors will trust and respect the judgment of a person who is a professional. Specialized knowledge is always appreciated.
When you have a professional negotiation for yourself or your company, you can be sure that you are in good hands and that it might actually be all you need to succeed.
It is an investment
Having a licensed and qualified IP is the best investment for the future of your company. Without such guidance, directors may face issues involving personal liability for the company’s debt, allegations of wrongdoing, and going out of business. An IP analyzes business operations in great detail to find a solution soon enough. An IP ensures that the most suitable route is taken and then works to maximize the interest of creditors without neglecting commercial interests either.