Calendar Wednesday, December 19, 2018

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Radford Invitational XI

JOBA Management Services© prides itself on being a financial supporter of community sport.

 

We take great enjoyment in being associated with Radford cricket and their involvement in Country Cricket Week each year. Read More...

Insolvency & Reconstruction Solutions PDF Print E-mail
Individuals/ Sole Traders/ Partnerships

 

 

 Informal Intervention / Reconstruction

 

 

At JOBA Management Services we specialise in rescuing individuals (and small to medium sized businesses) from formal insolvency administrations.

 

One of the major advantages of a reconstruction process is that it is private and allows an opportunity to negotiate outcomes with key stakeholders.

 

The purpose is to preserve not just the assets, but if a business is involved, continue as a going concern.

 

The key for individuals (and stakeholders) and their advisors is to identify and acknowledge that problems exist and take pro-active steps before it is too late. 

 

The single biggest impediment to implementing a long term and successful informal turnaround management stragegy is time.

 

The process is informal is because it is not strictly governed by legislation.

 

 

 

Identifying Problems

 

 

The Australian Securities and Investments Commission (ASIC) has succinctly listed ‘Signs that may indicate that your Company is at risk of insolvency’ which, by analogy, applies to individuals / sole traders / partnerships in part or in whole:

 

• ongoing losses

 

• poor cash flow

 

• absence of a business plan

 

• incomplete financial records or disorganised internal accounting procedures

 

• lack of cash-flow forecasts and other budgets

 

• increasing debt (liabilities greater than assets)

 

• problems selling stock or collecting debts

 

• unrecoverable loans to associated parties

 

• creditors unpaid outside usual terms

 

• solicitors’ letters, demands, summonses, judgements or warrants issued against your company

 

• suppliers placing your company on cash-on-delivery (COD) terms

 

• issuing post-dated cheques or dishonouring cheques

 

• special arrangements with selected creditors

 

• payments to creditors of rounded sums that are not reconcilable to specific invoices

 

• overdraft limit reached or defaults on loan or interest payments

 

• problems obtaining finance

 

• change of bank, lender or increased monitoring/involvement by financier

 

• inability to raise funds from shareholders

 

• overdue taxes and superannuation liabilities

 

• board disputes and director resignations, or loss of management personnel

 

• increased level of complaints or queries raised with suppliers

 

• an expectation that the ‘next’ big job/sale/contract will save the company.

 

 

 

Further issues may include (but not limited to):

 

• significant unmanageable credit card debt;

 

•  family breakdown;

 

• Partner / beneficiary disputes;

 

• Reliance on second and third tier lending for normal advances; and

 

 • Partner / beneficiary disputes.

 

 

   

 

Formal Administrations

 

 

In the event that a formal personal or corporate administration is unavoidable we have numerous preferred registered liquidators and registered trustees who will accept appointments.

 

Not all administrations are necessarily terminal and where possible JOBA Management Services will work with you in formulating a strategy that will maximize your net wealth at the end of the process bearing in mind any statutory responsibilities.