Creditors Voluntary Liquidation has been saved
Creditors Voluntary Liquidation
We are supporting businesses across Ireland to manage and mitigate the risks associated with COVID-19. We make every effort to save companies, but a company may find itself in a position where it has become insolvent due to the pandemic and liquidation is the only practical option
- What is a Liquidation?
- How does the Liquidation process work?
- When should a company consider liquidation?
- How can Deloitte help?
- Related topics
What is a liquidation?
A company becomes insolvent when it is unable pay its debts as they fall due. Liquidation is a process used to wind up and dissolve a company so that it ceases to exist. There are three types of liquidation:
• Creditors Voluntary Liquidation - the route most often taken by directors of insolvent companies where there is no reasonable prospect of survival.
• Members Voluntary Liquidation - used to wind up solvent companies that have ceased trading or are dormant.
• Court Liquidation - occurs when the High Court puts an insolvent company into liquidation after hearing a winding up petition.
How does the liquidation process work?
The company decides to go into liquidation and appoint a liquidator via a Creditors Voluntary Liquidation with the assistance of liquidation experts such as Deloitte. Once appointed the liquidator takes responsibility for dealing with all aspects of the company including engaging with its creditors, employees, the Revenue Commissioners and bankers.
This brings closure to a difficult position for the company's directors, with all the attendant anxiety and stress and allows the directors to move on to other things. Liquidation also helps to safeguard the directors’ legal position and personal financial exposure.
When should a company consider liquidation?
• If it is under pressure from its creditors such as the Revenue Commissioners and suppliers.
• If it is likely to be unable to pay its employees.
• If it has no reasonable prospect of raising investment to save the company.
• It is experiencing trading difficulties that is causing the directors to become concerned about their legal responsibilities and potential personal liability.
How can Deloitte help?
Our Creditors Voluntary Liquidation experts can guide you through all aspects of the Liquidation process by:
- Providing a free confidential consultation to assess the company’s options.
- Assisting you in putting a company into liquidation.
- Acting as liquidator of the company.
We regularly act as liquidators for companies of all sizes, in every sector of the economy. Our deep knowledge and experience of liquidations enable us to anticipate and mitigate many of the issues that can arise on appointment.