Getting prepared for the new small business rescue legislation

Friel Stafford > Blog > Business > Getting prepared for the new small business rescue legislation

Getting prepared for the new small business rescue legislation

  • Posted by: Tom Murray
  • Category: Business
Fresh Start

It is very positive news to see that the new Small Company Rescue Process legislation has now passed all legislative stages and is being sent to the President for signing.

The Minister’s press release from yesterday may be read on link below:

https://lnkd.in/eWbEHrh

With the well flagged tapering off of Government supports coming quickly this autumn, and with many companies finding trade sluggish upon reopening, with this timely news, Directors of struggling micro and SME’s companies attention needs to be focussed on being best prepared to avail of this new procedure.

Whilst it is well flagged and documented what the procedure is about – consideration needs to be given as to how to be best positioned to successfully enter the process and then exit repositioned on solid financial foundations.

I would strongly suggest that Director’s with the help of their accountants

  1. Commence preparing a pack of information for the Process Advisor such as:
  • a brief history of the company,
  • an organisation chart,
  • summaries of property leases and finance leases,
  • summary of employees’ salaries and employment history
  • an excel spreadsheet of all creditors to include postal and email addresses,
  • cash flow forecasts and trading forecasts
  • Statement of Affairs.

2. Appoint an experienced Insolvency Practitioner to guide you through the process.

3. Bring management accounts up to date,

4. Submit all tax returns. In particular, ensure that you have adjusted your VAT returns if you have not paid a supplier within the required 6 months.

5. Avoid directors putting monies into company now. Ideally, wait for SCARP process, as “new monies” can be very persuasive to creditors.

6. Review if trade creditors have valid Retention of Title clauses.

7. Obtain valuations of buildings, plant & machinery.

8. Consider impact on any ongoing insurance claim for business interruption

9. Consider implementing a “pay freeze” in respect of certain creditors?

10. Consider implementing a redundancy program?

11. Surrendering leases to landlords (and thereby quantify their claims now)?

12. Open up a new bank account with another bank to avoid set off of accounts.

There is a lot to take in. In this contest, we continue, as we have done since 1994, to operate a Free / No Obligation confidential helpline by phone, 01 6614066 and by email, info@frielstafford.ie for accountants and their clients.

We are also happy to provide free in house CPD training to your team and / or your network the new proposed legislation on Small Company Rescue.

If you wish to discuss any of our services, or obtain a fee quotation, on a confidential basis, don’t hesitate to contact me on:

Tom Murray tom.murray@frielstafford.ie Mobile: 087 834 9495

Author: Tom Murray