AUSTRALIAN CAPITAL LENDING HELPS WITH YOUR WIND-UP LETTER
Winding up a company can be an emotional experience for any business owner or director, but it is a completely natural and common event in the Australian small business landscape. It can occur for many reasons; either you have reached retirement age, you are chasing a career dream in another sector, you are no longer physically able to run a business, or you believe your business has reach its financial peak and you wish to ‘get out while you’re ahead’. To do this, however, a range of steps must be taken – and if they are not executed in a proper, compliant manner, you could face unwanted problems down the road. At Australian Capital Lending, our team of financial professional boast plenty of experience helping businesses to neatly and officially cease operations.
THE STEPS TO WINDING UP A SOLVENT COMPANY ARE AS FOLLOWS:
Company Directors Must Make A Declaration Of Solvency
As per the Australian Securities and Investments Commission (ASIC), the majority of directors must make a Declaration of Solvency. This means, they must state that their belief is the company will be able to meet all its existing debts, from employees to stockists, within of 12 months of the initial stages of the winding up process. Australian Capital Lending can make sure this is realistic, and handled in a professional and cordial manner, as this can often be a tough period for a group of directors. Also, we can make sure the forms are lodged in a correct manner.
Company Members Must Pass A Special Resolution
After the successful application of the solvency declaration, the company’s members and directors have three weeks (21 days) to pass a special resolution that, at a minimum, 75 percent of the members present are in favour of. If this goes through, the company must then appoint a liquidator, and lodge another form to acknowledge this has been passed. Australian Capital Lending can help to lodge the forms, and appoint a highly recommended and responsible liquidator. The competence of the liquidator, at this point, is crucial – as delaying the process could derail the ‘wind up’
Public Recognition Of The Wind Up
The above processes must then be recognised on the ASIC Published notices website within of the next business day. This is on a strict deadline that involves a responsible approach and steady, experienced hand.
Liquidator Winds Up Company’s Affair
The appointed liquidator begins work on thoroughly investigating the company’s affairs. They study both the receipts and payments, assessing the health of the company’s finances and the likelihood that the company will fully be able to pay their debts. If the liquidator has any doubts that these payments will not be able to be met, they have to power to: convene a meeting of creditors, appoint a voluntary administrator, and/or apply to the court for the company to be wound up in insolvency. The latter of which it is crucial to avoid.
Liquidators Completes Winding Up Company And Lodges Final Documents
After filing a series of forms, and waiting out a process that lasts just over three months, the company will be registered and cease to exist barring court involvement by a member of the company or a creditor. This process is not as simple as waiting out idle time, and Australian Capital Lending’s financial specialists can advise you throughout the course of the process to ensure everything runs smoothly.
DO YOU REQUIRE ASSISTANCE WINDING UP YOUR BUSINESS IN A COMPLIANT, EFFICIENT MANNER?
Contact our experienced team of business professionals at Australian Capital Lending to ensure your finances are presented responsibly in the wind up of your company. We will ensure all the legal documents are water-tight, and no trouble arises in this painstaking process.
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