Insolvency Law Flashcards
When the company is in difficulty what 2 options does it have?’
Liquidation or administration
What does liquidation do?
What does administration do?
Winds up the company
aims to rescue company
Liquidation
What two types are there?
What two types of voluntary are there?
When will the business go into compulsory?(3)
Voluntary and complusary
Members voluntary
Creditors voluntary
When they are unable to pay their debts
When it is just and equitable
When they do not have a trading certificate
When distributing assets what is the order in which this is done?(7)
Fixed charges Costs Preferred debts Floating charges Unsecured ordinary creditors Deferred debts Members
When paying costs what does this include?(3)
Costs of getting in assets
Liquidator remuneration
Incidental costs
What is included in preferential debts?(3)
Employee wages
Accrued holiday pay
Contributions to occupational pensions funds
What happens at a certain percentage when paying unsecured ordinary creditors?
It is ring fenced
What do deferred debts include?(2)
Dividends declared but not paid
Interested accrued on debts since liquidation
