mce-anchorWhat is the voluntary administration process? In...

mce-anchorWhat is the voluntary administration process?

In short, the voluntary administration process allows a company experiencing cash flow or solvency problems breathing space from its creditors to restructure.

It is generally a short period of approximately one month, whereby the directors hand control of the company to an independent administrator.

In that month, the administrator secures and protects the assets and assesses the business to provide a recommendation to creditors on whether they should:

1. Liquidate the company, or
2. Execute a deed of company arrangement (DOCA) – meaning compromise the debts in some way and allow the company to continue in existence, or
3. Return the company to the control of the directors.

Importantly, the final decision on the future of the company rests with the creditors.

- See more at: https://www.franchise.edu.au/home/t...y-administration-process#sthash.M1O0E0BQ.dpuf