can tailor content to yourself and give you the best possible experience.
FA Simms. Free business rescue and insolvency advice.
We take a personal approach to business rescue and insolvency, and have done since we were established in 1978.
By working in partnership with you and your client to understand their business challenges and aspirations, we can often find a solution to save the business and set it up for a more successful future.
A big part of moving forward is having the right knowledge at the right time.
We offer AIA members two benefits that will connect you and your clients to one of our licensed insolvency practitioners when and where you need them.
A free business rescue and insolvency helpline.
Our nationwide team of business rescue experts and licensed insolvency practitioners are on hand to give you guidance on any personal and corporate procedure. The call - and all advice - is completely free. You can get in touch on 08450 705959
A 20% discount on our services.
If your client needs advice and support through their business’ financial challenges, they can speak to us without obligation or charge. Should they choose to use our services, they’ll benefit from 20% off any of our fees if they’re referred by you.
They can call us on 08450 705959 or visit one of our offices across the UK. You can find a full list of our locations here
Free access to our anti-money laundering compliance software AMLCC (usually £299+VAT per year)
AMLCC makes it easy to reduce your risk of exposure to money laundering. Created in partnership with supervisory bodies, AMLCC’s online platform features every tool that accountants and bookkeepers need to stay AML compliant.
AMLCC offers comprehensive firm and client risk assessments, a complete online training programme, an automatic audit trail, suspicious activity reporting, sanctions compliance…and more.
As an AIA member you can access the AMLCC standard package free of charge. AIA will send you a discount code along with your practising certificate. This code can be redeemed when ordering or renewing the AMLCC product. If you’re an existing subscriber to AMLCC, please retain the code and redeem it when renewing your AMLCC subscription.
AMLCC also offers a complete digital client onboarding service, including biometric ID verification checks as a standalone service - quicker, easier and more accurate than doing it yourself. This service can be purchased on a Pay As You Go Basis.
There is much doom and gloom about the UK economy right now with the coronavirus pandemic set to cause the deepest recession in Britain for 300 years. Many companies, large and small, face the prospect of administration. But rather than fear it, could it be a blessing in disguise?
The Azzurri Group has recently been sold out of administration, saving around 5,000 jobs.
Steve Holmes, chief executive of Azzurri Group, said: “Despite being a successful operator, the immediate loss of revenue during lockdown meant that we have had to make some incredibly difficult decisions to protect the business for the long term.
“Additional investment has enabled us to preserve the majority of our restaurants, stores and jobs and I am confident that, under TowerBrook’s ownership, Azzurri will navigate the period ahead successfully.”
How could administration benefit the company?
The‘breathing space’ administration affords is one of the main benefits, but it is far from the only one.
Move forward debt free
Negotiating deals to pay off creditors means you can move your business forward debt-free. This increases your scope for investment in technology, staff, product development and marketing/PR. It could also give you a competitive advantage over rival businesses carrying a debt burden.
Create a more agile business
Too often companies operate a business model‘because we’ve always done it that way’. Streamlining is an inevitable part of the administration process, giving you the opportunity to work better with customers, suppliers and staff.
For example, the coronavirus pandemic has shown many firms that they can operate without having to rent office space (or they can vastly reduce their office-space requirements).
Mike Hampson, chief executive of Bishopsgate Financial, told the ‘thisismoney’ website the company is“ditching [its] swanky offices in London”. The business employs 18 people but following the lockdown he has realised that the staff only needs to meet a couple of times a month to operate, and all will be working remotely.
Save jobs – and the wider economy
Unlike insolvency, where all jobs are lost, administration means there’s a good chance some jobs will be saved.
And by continuing to trade, your company is helping others by doing business with them – and so the wider economy. The government benefits too, from an increased tax take and spending less on social security programmes.
Enhance your business reputation
Taking a company into administration and bringing it out the other side leaner and more fit-for-purpose shows you have solid business acumen and are not afraid to make tough decisions when they need to be made.
Types of Administration
Administrations generally resolve in four ways: with a CVA, with a pre-packaged insolvency sale, with a healthy, stable business, or with liquidation/dissolution.
For the purposes of this article we will focus on the first two.
Company Voluntary Arrangements (CVA)
CVAsare a common way of dealing with potential insolvency. Working with a licensed insolvency practitioner (IP), you must work out a schedule for repaying your debt – also outlining what percentage of the debt you will be paying back.
A CVA is a formal arrangement that must be overseen at all stages by the IP, who ensures creditors are paid the right amount and on time.
Creditors vote to accept the proposal, and in many cases approve because they accept that having some of their debt repaid is better that none at all (which could be the case with liquidation).
The process has also been used by clothing store All Saints, Hotter Shoes and high street giant Debenhams.
Insolvency trade body R3 describes a pre-pack as: "Where the sale of a company’s business and/or assets is arranged before the start of an insolvency procedure then completed immediately or shortly after the procedure begins. Proceeds from the sale are used to repay the company’s creditors.”
Pre-packs take place when an IP agrees a pre-pack is the means of achieving the best possible returns for the company’s creditors (all pre-packs are overseen by an IP).
Bed retailer Dreams and Blacks Leisure are examples of where a pre-pack has been used successfully.
The Corporate Insolvency and Governance Bill
The focus of theCorporate Insolvency and Governance Act 2020, which came into force on 26th June 2020, introduces a formal‘moratorium’ - an initial period of 20 business days - during which no legal action from the majority of creditors can be taken against a company without court permission.
It will allow SMBs extremely valuable time to seek help from an IP - only a licensed insolvency practitioner can supervise a company entering a moratorium - and formulate a rescue plan.
Going into administration can be daunting. But with the right help it need not be the end of the line for your business. You could emerge debt-free (or with much less debt), leaner, with a clearer plan for the future.