The appointment of Opus Restructuring & Insolvency as provisional liquidators to supervise the continuing trading and eventual winding down / closure of Hogganfield care home in Glasgow and Skye View in Airdrie in early June is just the latest bad news for the Scottish residential care sector, which had already been experiencing the largest number of closures for many years
What happens to the funds raised by Insolvency Practitioners (IPs) after they are appointed as Administrators or Liquidators? This is a mystery to almost everyone outside the insolvency profession and is so often the source of huge misunderstanding and upset amongst those stakeholders who find themselves at the end of the queue for distributions. The best way is to look
Fortunately, few people have any direct experience of a company failure. When they do, the priority ‘waterfall’ for distribution of what’s left in the pot after a business has gone through Administration or Liquidation comes as a mystery. In an ideal world, there would be enough money to go round, but, in reality, it is rarely that straight forward. Due
Following our first three articles on business devaluation during insolvency, we now turn our attention to the liabilities in the balance sheet. What is often not realised is how a business’s liabilities can grow faster than Jack’s Beanstalk once the business has transitioned from a going concern to a financial downturn ending in insolvency proceedings. This can occur on a
In this third instalment on the devaluation of a business during insolvency, we turn our attention to current assets. These assets can not only shrink alarmingly in value during insolvency proceedings, but can also, in some circumstances, actually turn into net liabilities. How can current assets lose value? Inventories Inventories include a wide range of different items. From raw material
In our first article in this series, we looked at the mystery of why apparently solvent companies end up heavily devalued and paying almost nothing to their unsecured creditors if they have the misfortune to file for insolvency. Now we dive into more detail into the conflict between book values and real life realisations in an insolvency context, starting with a
