For directors of insolvent companies, finding the right path forward can be challenging. Some companies in difficult financial situations would, for example, benefit most from closing through a Creditors’ Voluntary Liquidation (CVL). Other companies would benefit most from attempting to alleviate the financial pressure, rather than completely winding down operations. A Company Voluntary Arrangement (CVA)…Read More
When a creditor is owed money by a company and their payment demands have gone unfulfilled for more than 21 days, they are entitled to issue a winding-up petition to the court. The winding-up notice asks the court to liquidate the company as it is believed that it is insolvent. Once liquidated, the proceeds and…Read More
What is a CVA?
When a business is insolvent or experiencing financial difficulties, there are several options open to it. From liquidation, which liquidates and dissolves the company, to options for business rescue, such as a Creditors’ Voluntary Arrangement (CVA.) A CVA is an agreement made between company directors and creditors to pay back the company’s debts (or a…Read More
It has been announced that almost half of the UK’s small and medium-sized businesses sought financial support in 2020. That’s more than three times the level from the previous year. The British Business Bank found that 43% of these companies had received external financing in 2020 including government loans and grants, compared to just 13%…Read More
A Company Voluntary Arrangement (CVA) allows an insolvent company to come to an agreement with creditors to repay its debts over a fixed period of time. Whilst a company is under a Company Voluntary Arrangement, the director remains in control and it will continue to operate and trade. This is an option taken by those…Read More