As I post I will post up a series of helpful passages on various insolvency procedures with which I an familiar. As an insolvency solicitor I can offer help and advice on any personal or corporate problem you have. Feel free to post any question you feel you may need help with.
Company Voluntary Arrangement
The company voluntary arrangementis ofern referrred to as a CVA. It an alternative to the creditors’ voluntary liquidation. Both corporate debt solutions are made good use of, and have been on the statute book since the advent of the Insolvency Act 1986.
The CVA is available for those who have an insolvent business which can’t pay it’s debts as and when they fall due, but which, if giving some breathing space would be able to make regular monthly payments into a fund which could be distributed to creditors annually. In practice a company must be able to contribute at least £1,000 a month. For a business with a significant turnover, this should be easily manageable. It is often combined with sever cost cutting, which enables the business to re-structure itself and emerge leaner. On occasions it follows an administration, which may have first been used to protect the assets of the company from plunder from creditors taking enforcement action.
The creditors voluntary arrangement, can be used for a partnership, and will be known as a PVA, or partnership voluntary arrangement, and will be useful for accountants, solicitors and architects.
Most arrangements of this sort stay in place for 60 months and may also include lump sum payments at various stages, for instance if it is envisaged to sell property.
It is not to be undertaken lightly as to fail it would mean that all unpaid debts would still remain due. It is worth bearing in mind that business can change over time, and a commitment that is entered into this month, may not hold up 12 months later.
If you need advice please call Steve on 0116 2171406 or follow the link
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