When a company becomes insolvent they must lodge an insolvency notice with ASIC. The Corporations Act 2001 (Cth) requires these notices to be published and made accessible to the public. .
What is Insolvency?
Insolvency is when a company is no longer able to pay its debts by the required time. If a company continues to trade while they are insolvent there may be serious penalties. Therefore it is crucial that you know when your company has become insolvent.
There are three main insolvency procedures:
- Voluntary administration
This is when an independent registered liquidator is appointed to wind up the company. The liquidator sells the company’s assets and then redistributes the money to the creditors. Once a company goes into liquidation then it usually cannot be saved and is dissolved.
This is when a voluntary administrator is appointed to take control of the company and look into the company’s affairs and provide recommendations on what the company should do next.
This is when a receiver is appointed by a secured creditor. The role of the receiver is to sell the company’s secured assets to repay the debt to the creditors.
What is an Insolvency Notice?
An insolvency notice informs the public of the uncertainty surrounding a company’s financial position or other matters relating to the company’s closing. It provides creditors with information regarding upcoming meetings and the contact details of the people working on the issue. Insolvency notices are lodged and published on ASIC’s published notices website. Examples of what a notice may cover includes winding up applications, deregistration of the company and notices relating to schemes of arrangements.
For more information on insolvency notices please contact 1300 337 997 or fill out the form on this page.