FIVE THINGS TO CONSIDER BEFORE DECIDING ON A LIQUIDATOR - AUCKLAND LIQUIDATION EXPERTS
1st March 2022
Introduction
The liquidation process may seem straightforward, but it could become difficult with numerous issues that must be addressed, or the process will be delayed and be costly with no or much lesser proceeds available for distribution amongst creditors. Hence, it is essential to have some basic information to prepare for the procedure.
In this context, some important questions are asked and answered.
Who is a liquidator?
A liquidator takes control of the company's assets and manages the entire liquidation process in accordance with the Companies Act. Shareholders of a company can appoint a liquidator voluntarily, or the Court can appoint a liquidator, the latter usually done by a creditor. Whether you are in Auckland or other parts of New Zealand, Nair Draht Ltd can assure you of the best service to be provided.
What is the role of a liquidator?
A liquidator takes control and monetises the company's assets to settle its debts and distribute the proceeds between the creditors in accordance with the provisions of the Companies Act. They take charge of the business from the onset of the liquidation process. Their duties include interviewing company officials, corresponding with all interested parties, investigating the whereabouts of assets, investigating possible claims, filing statutory reports, obtaining and resolving creditor claims, and conducting formal insolvency enquiries.
What is the purpose of liquidation?
Liquidation implies the end of many businesses and the closure of companies. Once their assets are sold and the proceeds divided amongst creditors, matters are brought to finality. Liquidation aims to help creditors recover funds and resolve all legal actions the company may be facing. Once the process is completed, a final report is issued, and the company is removed from the register of companies.
When to consider appointing a liquidator
The duties placed on directors by the Companies Act mean that they expose themselves to personal liability should they continue trading whilst the company is insolvent. Therefore, it is important to consider liquidation once the company becomes unable to settle its debt as it becomes due and when its liabilities exceed its assets. Should any of these circumstances arise, it is in the interest of the directors to seek insolvency advice. Nair Draht Limited, Liquidator in Auckland, can assist you and guide you to make the right choice under challenging circumstances and, if possible, even help to avoid liquidation.
Factors to consider before appointing a liquidator
There are matters one must consider before appointing a liquidator. The liquidation process is complex, and you need experts to handle it appropriately. These critical factors include:
a. Their level of experience
The level of your liquidator's experience is essential, and an experienced liquidator can make the process less problematic and finalise the administration process speedily and without incurring unnecessary costs. We assure you that Nair Draht Limited is experienced in the liquidation process and will be able to assist you.
b. Their rates
Usually, by this time a company is experiencing its darkest moment. So naturally, the last thing the company's director wants to worry about is further cost. The Court has approved certain rates for liquidators, and you should ensure that the rates charged are within those principles. At Nair Draht Limited, we ensure that our rates are always reasonable in the interest of all parties involved.
c. Their reputation
Nair Draht Ltd prides itself on always being honest and straightforward. It has an excellent reputation in the insolvency industry and provides practical and reliable solutions.
d. Their level of professionalism
Being licensed insolvency practitioners, the directors of Nair Draht Limited spent many years of practice in their professions and are familiar with the professional environment and have built up a sound reputation over the years.
e. Provision of alternative insolvency advise
At Nair Draht Limited, we endeavour to provide clients with alternative options. If it is possible and in the interest of creditors to avoid liquidation, we will always provide you with appropriate advice and other options that might be available.
Conclusion
Going through liquidation does not have to be overwhelming. Make sure you approach a reputable company like Nair Draht Ltd.
Nair Draht Ltd offers Liquidation services throughout all parts of New Zealand:
Auckland l Christchurch l Wellington l Tauranga l Nelson l Rotorua l Hamilton l Dunedin l Palmerston North l New Plymouth l Napier l Whangarei l Taupo l Invercargill l Oamaru l Gisborne l Queenstown
To enquire more, reach us at 09 522 9709 or 021 689 633. You can also email Heiko Draht at heiko@glca.co.nz.