What Should I Do If I Receive A Statutory Demand?

The very first thing you must do when receiving a statutory demand is pay attention. statutory demand IrelandThis is not something you can ignore or even put off for another day, these demands must be answered in a timely manner. A statutory demand is initiated by a creditor as a demand for payment, installments or security on a debt your business owes, and if left unanswered they can request bankruptcy on your company at which point the courts will appoint a receiver, examiner or liquidater to deal with the situation.

Insolvency Adviser

As soon as you receive this type of notification that your company is in distress you should be looking for some advice. There are insolvency consultants you could turn to for help; you may even have an in-house legal adviser who could point you in the right direction. Your answer to a statutory demand is going to be very dependent upon where your company is and if there is any hope of financial recovery. A good insolvency consultant can go through the information with you and point out areas where you could trim costs and begin covering your business debts.

Do it Yourself

Many business owners and individuals want to know if they can handle a statutory demand themselves, and in some cases you can but it will still require prompt attention. In some situations, these demands are issued but not valid, which means you can apply to the courts to have them set aside. Again, this is something you will want to address in a timely fashion, say within 18 days of receiving the statutory demand.

Set Aside Circumstances:
• You dispute the amount of the debt
• You have a counterclaim for more than the current demand against you
• Demand is below a specified sum
• You do not owe the debt

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Understanding the Role of an Insolvency Consultant

Today it is even more common for businesses to find themselves facing economic hardship; everyone is feeling the pinch from the economic downturn. When a business can no longer sustain itself or their liabilities far outweigh their assets, the business is deemed to be insolvent. When it looks like a company is headed down this path an insolvency consultant may be asked to step in and guide the business to firmer ground, or to liquidation. These individuals specialise in insolvency, particularly the laws concerning it.

Assessment

The first thing an insolvency consultant is going to do is look at the business as a whole to determine if restructuring is a possibility. They will check into management backgrounds, assess the assets and liabilities, test the market and then work to come up with a viable solution that is in the best interests of all concerned.

Options

Once the initial assessments are complete, an insolvency consultant will then take you through which options are available to your company. There are several ways to deal with financial difficulties including bankruptcy, liquidation, restructuring and more. Which of these is best for your business will depend on many factors such as whether or not it is a temporary situation. If the market appears to be recovering and your company is not too stretched, you may be able to continue trading.

Example:
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What Is Voluntary Liquidation?

Insolvency In Ireland - What Is Voluntary LiquidationEven today, there are companies that find themselves in financial difficulty and file for bankruptcy.  This drastic step is often unnecessary because there are other options that can be taken. Bankruptcy should be a distressed company’s last resort, as the other options are a lot less severe on the reputations and credit ratings of the company directors involved.

The saying “It’s not over ‘till the fat lady sings” applies just as much to a distressed business as to an opera.  A distressed business may appear to be ready for it’s final curtain call, but a company director needs to get the best professional advice he can at this time.  An insolvency consultant can assess the full business situation and can often work out if the company can be saved, or not. But even if the insolvency consultant advises that the business is not in a position to continue trading, they can advise on the appropriate course of action to take to wind up the company. One such alternative action is Voluntary Liquidation.

Voluntary Liquidation Explained:

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How an Insolvency Consultant Can Help Your Business

How an Insolvency Consultant Can Help Your BusinessThere can come a time in any business when things begin to go wrong, resulting in possible insolvency. When this happens, there may be a temptation to bury your head in the sand and not admit what is going on until it is too late to make positive changes. This is where an insolvency consultant can help your business tremendously, particularly if you invite them into the situation instead of waiting on a court appointed examiner or consultant.

Fresh Perspective
When you are on the inside of a situation, it can be very difficult to see a clear way out. Insolvency consultant professionals are trained to deal with financial situations of all kinds and their only focus is in getting your company financially fit again. This means that the barriers you may have to making the right cuts such as personal involvement or sentimental concerns are not going to be an issue.

Clear Cut

Just because you know your business is in trouble does not mean you have any idea on how to move forward to a successful conclusion. An insolvency consultant can give you a clear road map or step-by-step instructions on exactly what it will take to move your company from near bankruptcy to operating in the black again. They can hand you a surgically precise formula that can be passed to the right people within your organisation for implementation.

Future

In addition to helping, you return to solid ground an insolvency consultant can also give you some helpful tips and ideas on how to maintain your financial stability. You see, consultants are highly trained and vetted accountants who have a vast amount of experience in this type of situation and they can help you avoid this problem in the future.

Call a Code

There are times when insolvency is simply inevitable; your business has just gone too far into the red. This is another time when it is hard for someone close to the situation to actually give up and face the difficult decision to liquidate the business. While you can choose to ignore an insolvency consultant professional’s advice in this area, you should know that continuing to operate a business knowing it is insolvent could leave you personally responsible for huge debts and other sanctions.

An insolvency consultant can offer many different options and help your business out of financial difficulty. The key to this is being willing to listen to what your consultant has to say. When you hire a consulting firm yourself there is a temptation to “take it under advisement”, meaning you have no plans to follow the program. This will be the worst mistake you can make in business, especially in a failing business.

This article was written by Robert Potter of RP Consulting, a business recovery and insolvency specialist company based in Dublin, Ireland. For more information and advice on insolvency in Ireland go to http://www.InsolvencyInIreland.ie