If your company is experiencing financial distress or going through tough times, then you may be considering getting some expert advice to help you navigate these choppy waters. This would ideally be in the form of an experienced insolvency practitioner.
However, unless you have dealt with an insolvency practitioner before, you may be unsure what it is they do and how they can help your business. When times are hard, the idea of paying someone a fee can seem like the wrong move. However, an experienced insolvency expert will be more than worth the investment.
Before you make any decisions, as a business owner it is always a good idea to find out more about what an insolvency expert will do for you and what value they can bring to your business, particularly during the first stages of financial distress.
What is an insolvency practitioner?
Insolvency practitioners, often referred to as IPs within the industry, are people who are licensed to act on behalf or either companies or individuals when they are experiencing acute financial distress. As well as finding solutions to these difficult situations, they can also help to liquidate or wind up the company in the best way possible – often through using Members’ Voluntary Liquidation to help keep hold of profits.
In general, a company director will approach an IP when finances are getting very difficult to handle and the business is heading towards trouble. However, there are times such as forced liquidation, when the courts will appoint an Official Receiver who will act as the liquidator.
Does an insolvency practitioner need to be qualified?
The short answer is yes, they do. But the route towards qualification can be very varied. Many IPs will have accountancy qualifications such as ACCA, ACA or CIMA. However, this is not a legal requirement and an accountancy qualification is not necessary to become an IP.