Company Administration Collingbourne Ducis in Collingbourne Ducis

Contact Us

Company administration is a formal insolvency procedure designed to rescue an insolvent company or, if immediate liquidation is impossible, achieve a better outcome for creditors than that. 

The purpose of administration is to protect the company from legal actions. The administrator assesses and manages the company’s affairs, primarily rescuing the company as a going concern.

Company administration is crucial in the UK’s corporate landscape, particularly for businesses grappling with financial distress. 

This legal mechanism offers a lifeline to insolvent companies or those on the brink of insolvency. 

It provides a structured approach to protecting assets, managing liabilities, and potentially reshaping operations to ensure survival. 

Recieve Free Advice

An organisation that demonstrates insolvency could risk being shut down due to financial issues. 

If a business chooses company administration in Collingbourne Ducis, it will be appointed by an insolvency practitioner who acts as the administrator. 

The Administration Process in the UK

The Administration process is designed to rescue the company if possible or to achieve a better outcome for creditors than liquidation. 

The administration process in the UK is detailed, from initiation to exit.

Initiation

A company can enter administration when it cannot pay its debts, meaning it is insolvent. The directors can initiate the administration, which can be voluntary or forced by creditors. 

The process begins with filing an application to the court, or in some cases, it can be done out of court through a notice of intention to appoint an administrator.

Roles of Directors and Creditors

Once the company becomes insolvent, directors are responsible for acting in the best interests of creditors. 

Creditors, particularly secured creditors, can trigger administration if they believe it will increase their chances of recovering debts.

Appointment of an Administrator

The court typically appoints an administrator, although in some cases, a qualified insolvency practitioner can be appointed without court involvement. 

The administrator’s role is to take control of the company, assess its financial position, and decide on the best course of action to maximise returns for creditors.

Administrator's Responsibilities and Powers

The administrator has wide-ranging powers, including managing the company’s business, disposing of assets, and negotiating with creditors. 

Their primary duty is to the creditors, ensuring that the process follows the legal framework and aims to achieve the best possible outcome for all stakeholders.

During Administration

The administrator begins by immediately controlling the company’s assets, reviewing financial records, and assessing the business's viability.

They may continue trading the business, restructure operations, or negotiate with creditors to reorganise debt if deemed beneficial.

Exit from Administration

The administration process can conclude in several ways:

  • Restructuring: The company may be restructured, allowing it to exit administration and continue operating under a new financial plan.

  • Sale: The business or its assets may be sold as a whole or partly to repay creditors.

  • Liquidation: If a rescue or sale is not possible, the company may enter liquidation, where its assets are sold, and the proceeds are distributed to creditors.

Creditors are paid based on the priority established by law, with secured creditors typically receiving payments first, followed by unsecured creditors. Shareholders are last in line and often receive nothing if the company’s assets are insufficient.

Get In Touch

How to Appoint an Administrator Collingbourne Ducis

Directors can appoint an administrator if they believe it is in the best interests of the company and its creditors. This is often a voluntary step to protect the company from creditors' actions while formulating a rescue plan.

Before appointing an administrator, assessing whether administration is the appropriate course of action is essential.

Administration is typically considered when a company is insolvent or at serious risk of insolvency and when there is a realistic prospect of rescuing it or achieving a better outcome for creditors than immediate liquidation.

Key indicators of insolvency are when a company cannot pay its debts as they fall due or when ongoing legal actions or creditor pressure threaten its operations.

Find Out More

How Does Administration Affect Company Directors?

When a company enters administration, directors lose control over the business. The appointed administrator manages the company to rescue it or maximise returns for creditors. Directors must cooperate fully with the administrator, providing necessary information and access to company records.

Directors remain legally obligated to act in creditors' best interests. They risk personal liability and disqualification from future directorships if found guilty of wrongful or fraudulent trading before administration.

While directors may retain their titles, their authority diminishes significantly. They cannot make operational or financial decisions and must comply with statutory requirements unless the administrator assumes these duties.

Administration can impact directors emotionally and professionally, affecting their reputation and career prospects. After administration, their future role depends on whether the company is rescued, sold, or liquidated.

The Difference Between Administration and Liquidation

Administration aims to rescue or restructure a company to maximise creditor returns. An administrator takes control, manages the company, and explores options to keep it running or sell it as a going concern. If rescue isn't possible, the company may still avoid liquidation.

Liquidation involves closing the company and selling its assets to pay creditors. A liquidator is appointed to oversee the winding-up process, leading to the company's dissolution.

Administration focuses on saving the business, while liquidation focuses on closing it down and settling debts.

What Are The Duties of an Administrator in the UK?

An administrator in the UK has several key duties when managing a company in administration:

  1. Rescue the Company: The primary duty is to try to rescue the company as a going concern, ensuring it can continue to operate and avoid liquidation.

  2. Maximise Creditor Returns: If rescuing the company is not feasible, the administrator must work to achieve a better outcome for creditors than would be possible through liquidation.

  3. Manage Company Affairs: The administrator takes control of the company, managing its assets, operations, and financial affairs to protect and preserve value.

  4. Secure Assets: The administrator must secure and protect the company’s assets from depreciation or unauthorised actions.

  5. Communicate with Stakeholders: The administrator must keep creditors, employees, and other stakeholders informed about the administration process and any decisions made.

  6. Distribute Funds: If the company is sold or assets are liquidated, the administrator is responsible for distributing the proceeds to creditors in accordance with legal priorities.

  7. Comply with Legal Obligations: The administrator must adhere to all relevant UK insolvency laws, including filing necessary documents with the court and Companies House.

These duties ensure that the administrator manages the company effectively during the administration process to maximise returns for creditors and, if possible, save the business.

Costs Associated with Company Administration

The costs of company administration in the UK typically include:

  • Administrator’s Fees: Administrators charge hourly rates, usually between £200 and £600 per hour, depending on complexity and their experience.

  • Legal Costs: Legal fees range from £10,000 to £50,000, depending on the case's complexity.

  • Disbursements: Expect additional expenses for travel, asset valuation, and advertising, typically adding £5,000 to £10,000.

  • Employee Costs: Continuing operations may require paying wages and redundancy, which can vary widely based on the company size.

  • Asset Management Costs: Securing and selling assets usually range from £5,000 to £20,000.

  • Final Reporting: Final reports and closure preparation might cost around £2,000 to £5,000.

Administration costs usually exceed £50,000, depending on the case's specifics.

Get A Price For Administration

How does company administration impact employees?

During administration, employees' contracts generally remain in place. The administrator can decide whether to retain or dismiss employees based on the company's circumstances and recovery strategy.

Employees are considered preferential creditors, meaning their wages, holiday pay, and other benefits are prioritised in the administration process. However, any arrears owed to employees beyond a specified amount may not be fully covered.

Can a company continue trading during administration?

A company can continue trading during administration if the administrator believes it is in the best interest of the creditors.

This can help preserve the business's value, maintain customer relationships, and potentially lead to a more favourable outcome, such as selling the business as a going concern.

The administrator oversees trading operations, ensuring they are financially viable. Risks include the potential for further financial losses, which the administrator must carefully manage to avoid worsening the company's financial situation.

What happens to contracts and leases during administration?

Contracts are not automatically terminated during administration.

The administrator can choose to continue, renegotiate, or terminate contracts based on the best interests of the creditors and the recovery plan.

The administrator similarly handles leases. If the lease benefits the company, the administrator may continue it; otherwise, they may negotiate with landlords to terminate or amend the lease terms.

What happens if the administration is unsuccessful?

If the administration process does not lead to the recovery or sale of the business, the company will typically proceed to liquidation. In this case, the administrator will shift roles to liquidate assets, pay creditors, and dissolve the company.

This often means reduced recoveries for creditors, as assets are sold off piecemeal. For employees, it typically results in job losses and claims for unpaid wages through liquidation.

How does administration affect company shareholders?

During administration, shareholders generally have limited influence, as the administrator acts in the interest of creditors. Shareholders may be consulted during the process, but their control over company decisions is minimal.

The value of shares typically declines significantly, and shareholders may lose their entire investment if the company is liquidated or sold at a loss.

How is the outcome of the administration process determined?

The outcome depends on the company’s financial health, the potential for restructuring, and the interests of the creditors.

The administrator assesses these factors to determine whether to restructure, sell, or liquidate the company.

The administrator must balance the interests of secured creditors, unsecured creditors, employees, and shareholders to achieve the best possible outcome for all parties involved.

How long does a company stay in administration?

Administration usually lasts up to 12 months, but this period can be extended with the creditors' or the court's consent.

If the administration needs to be extended beyond 12 months, the administrator must seek approval from the creditors or apply to the court for an extension, explaining the reasons for the delay.

What is the role of the court in company administration?

The court plays a crucial role in the administration process, particularly in appointing administrators, approving certain decisions, and resolving disputes.

The process usually begins with a court application to appoint an administrator. Subsequent legal proceedings may involve court hearings to address creditor disputes, approve the sale of assets, or extend the administration period.

How are unsecured creditors treated during administration?

Unsecured creditors are typically lower in the repayment hierarchy than secured creditors and employees. Depending on the company's asset realisation, they may receive only a portion of their debts.

While unsecured creditors can file claims, the amount they recover depends on the available assets after secured creditors and preferential creditors have been paid.

What happens to directors' personal guarantees during administration?

If directors have provided personal guarantees for company debts, creditors can still pursue these guarantees during administration. The directors may be personally liable for the guaranteed amounts.

Directors must carefully assess the risk of personal guarantees, as they can significantly impact their finances if the company enters administration and cannot meet its obligations.

Can company administration be challenged or reversed?

Creditors or other stakeholders may challenge the administration process if they believe the administrator is not acting in their best interest. Challenges typically involve court applications to review the administrator’s decisions.

It is rare, but possible, to reverse the decision to enter administration, particularly if the company’s financial situation improves unexpectedly or if there was a procedural error in the administration appointment. This would require a court application and strong justification.

What are the success rates of company administration in the UK?

The success of company administration varies depending on the industry, the company’s financial health, and market conditions.

Administration can successfully restructure or sell businesses, but not all companies are saved.

Studies and industry reports suggest that while some companies successfully emerge from administration, many ultimately proceed to liquidation, especially if the administration was initiated too late or if the market conditions are unfavourable.

What are the alternatives to company administration?

  • Company Voluntary Arrangements (CVAs): A CVA allows a company to agree with its creditors to pay off debts over time while continuing operations. This option is often less disruptive than administration.

  • Pre-Pack Administration: In a pre-pack administration, the sale of the company's assets or business is arranged before the company enters administration, allowing for a swift transfer of ownership and operations.

  • Liquidation: If the company cannot be saved, creditors might opt for liquidation, in which the company’s assets are sold to pay off debts and subsequently dissolved.

Contact Our Team

We cover Collingbourne Ducis (Wiltshire)

Get in touch

We aim to get back to you in 1 working day.


Skip to

Gallery

Other locations available for company administration collingbourne ducis
Rivermead North Newnton North Bradley Morgan's Vale Quemerford Upper Castle Combe Mannington Wick Netheravon Swindon South Newton Lower Woodford Bratton Quidhampton Crudwell Redstocks Winterbourne Earls Gladstone Parade Manningford Abbots Box Hill East Hatch Crooked Soley East Kennett Odstock Buck Hill Harnham Bagshot East Grimstead Woolley Green Mile Elm West Yatton Garsdon Ridge Blagrove Stert Newton Coped Hall Trowle Common Kellaways West Kennett St Andrews Ridge Woodcock Lydiard Plain Crockerton Green Short Street East Knoyle Westrop Erlestoke Hinton Parva New Town North Burcombe Eysey Lye's Green Chapel Barton Melksham Haydon Wick Boscombe Lower Village Dogridge Upper Pickwick Kington St Michael Mount Sorrel Upper Woodford New Town Middle Woodford Misselfore Norrington Common Lower Stratton Lane End Chicksgrove Bradford Leigh St Paul's Codford St Mary Heddington Wick Petersfinger West Hill Wadswick Lover Covingham Ham Rushall Hitcombe Bottom Wexcombe Kingston Deverill The Gibb Shaw The Green Allington Great Bedwyn Sodom Lawn Burbage Church End Biddestone Ash Brake Amesbury West Ashton Avebury Nettleton Sevenhampton Cuckoo's Knob Chisbury Townsend Corsley Sherston Parva Cowesfield Green Newtown Ogbourne Maizey Swallowcliffe Ugford Sopworth Barrow Street Mere The Spa West Hatch Lower Wraxall Seend Purton Common Hillmead Ablington Fonthill Bishop Cloatley Chedglow Old Town Tidcombe Milkhouse Water Sutton Mandeville Westcourt Bulbridge Berwick St James Hudswell Vastern Filands Firsdown Littleton Drew Queen Street Draycot Fitz Payne Old Sarum Rollestone Peckingell Lower Chute Hook Whitbourne Moor Manningford Bohune Cleverton Charlton All Saints Bowden Hill Fiddington Sands Littleton Westrop Catcomb Brookside Pinckney Green Southcott Whitepits Castle Eaton Avebury Trusloe Shalbourne Lower Everleigh Hilmarton Nythe Widbrook Potterne Wick Hannington Wick New Mill Little Bedwyn Lacock Foxham Limpley Stoke Laverstock Sherston Blunsdon St Andrew Eastleaze Enford Ferne Woolley Melksham Forest Giddeahall Ashton Common Strangways Netton Winterbourne Monkton The Stocks Hoggington Pole's Hole Alton Priors Pitton Middle Winterslow Clanville Chilton Foliat Bridgemead Longfield Cloatley End Wilsford Grittenham Pickwick Homanton Upper Westwood Fovant Middlehill Colerne Perham Down Urchfont Neston Hamptworth The Ham Gasper Sells Green Little Somerford Ram Alley Ditchampton Stoke Farthing Common Platt New Town Old Wardour Norton Ferris Rivar Dilton Marsh Newtown Stanley Lower Upham Liddington The Marsh Easton Grey Marston Bottlesford Huggler's Hole Chicklade Cuckoo's Corner Seend Cleeve Gorse Hill Christian Malford Wilton Littlecott Fifield Forewoods Common Mildenhall Lydiard Tregoze Berwick Bassett Badbury Wick Axford Imber Purton Burcombe Bohemia New Town Littleton Panell Allington Bar Britford Overtown Faulston Ragnal Durley West Amesbury Larkhill Donhead St Mary Sherrington Ogbourne St George Milston Bromham Penhill Coate Wincombe Kington Langley Nettleton Green Lockeridge Henley Holloway Cowesfield Gate South Tidworth The Fox Blackland Market Lavington Dunge Foscote Corton Fox Hill Marston Meysey Fisherton de la Mere Brixton Deverill Donhead St Andrew Shute End Calcutt Tytherton Lucas Idmiston Sutton End Yarnbrook Longhedge Greatfield Pewsham Sevington Redlands Stanton St Bernard Wingfield Bell Hill Elm Cross Little Salisbury Southbrook Milton Chalford Little Cheverell Bulkington Preston Ramleaze Upper Wanborough Brinkworth Wilson and Kennards Yard Studley Green Tanis Rodbourne Bottom Lower Coombe Beckhampton Leigh Notton Chute Cadley Bishopstrow Mountain Bower North Wroughton Eastrip Spirthill Froxfield Milkwell Charlton Alvediston Inglesham Knowle Whaddon Dertfords Perry Green Southwick Downton New Town Ansty Coombe Rockley Ditteridge Groundwell Westwells Clearwood Steeple Ashton Murhill Park North Bleet Landford Broad Town Berryfield Plaitford Chapmanslade The Close Winterbourne Bassett Deptford Cholderton Farley Westwood Bonham Cherhill Hayes Knoll Purlpit Chute Forest Little Chalfield Stormore Chapel Knapp West End Lake Dursley Boyton Coulston Clatford Well Head Horpit Pewsey Tuckingmill Grittleton Honeystreet Stockley Kingshill Ludwell Badbury Wolverton Even Swindon Bremhill Wick Hornbeam Grange Fosbury Hampton Park Stopper's Hill Collingbourne Kingston Limpers Hill Theobald's Green Mere Down Stockton Coate Ebbesbourne Wake Ballard's Ash Kepnal Edington Piccadilly Rook Street Serrington Bullock's Horn Dorcan Hoopers Pool Brook Waters Durrington Netherhampton Great Somerford Draycot Foliat Knapp Hill Littlecott Draycot Cerne Bishopstone Whaddon Zeals Upton The Warren Ashton Keynes Oaksey Tidworth Nomansland Paxcroft Heytesbury Sutton Benger Hilcott Seagry Heath Milford Bisley Hilperton Whitbourne Springs Townsend Lower Seagry Crockerton Hindon Burton Hill West Grafton Alderton Stratford sub Castle Rodbourne Straight Soley Avon Warminster Horton Higher Pertwood Hill Deverill Paxcroft Mead Berwick St Leonard Temple Langley Burrell Upper Stratton Ashley Luckington The Square Henfords Marsh Mooray East Gomeldon Easterton Sands Allington Murcott Greenhill West Grimstead Marr Green Farleigh Wick Little London Bewley Common North Tidworth Foxley Rudge Stanton St Quintin Upper Inglesham Ogbourne St Andrew Thornhill Knapp West Winterslow Lavington Sands Braydon Side Castle Ansty Pinehurst Westbury Leigh Upper Seagry Greenmeadow Great Durnford Gutch Common Clevancy Bishopdown Callow Hill Kilmington Common Lopcombe Corner Castle Combe West End East Winterslow Abbey Meads Goatacre Tockenham Wick Teffont Evias Studley Great Wishford Aldbourne Great Ashley Penleigh Long Dean Poulshot Lyneham Hook Street Highworth Lower Zeals Westbury Box North Wraxall Dinton Clench Swallett Gate Knook Yatesbury Westwood The Pitts Broadbush Wyndham Park Broad Hinton Norton Bavant Bremhill Sutton Veny Keevil Ford Uffcott West Knoyle Homington Wanborough Clyffe Pypard East Everleigh Collingbourne Ducis Trowbridge Townsend Bulford Quemerford Gate Mount Cowdown Codford St Peter Wootton Rivers Cotswold Community Hawkeridge New Town Thickwood Conock Hannington Knowl Croucheston Monkton Deverill Liden Stitchcombe East Chisenbury Elston Oxenwood Bowldown Norleaze Windmill Hill Atworth Baverstock Landfordwood West Gomeldon Tilshead Sedgehill Bulford Camp Lower Blunsdon Wichelstowe Charlton Cadley Lydeway Fyfield Heddington Upton Scudamore Lower Wanborough Hankerton Cadley Corsley Heath Stourton Wilton Toothill Whitley Staverton Heywood Easterton Sunton Wilcot Salisbury Blue Vein Corsham Winterbourne Gunner Malmesbury Reybridge Winsley Calne Marsh Broughton Gifford Zeals Row Fonthill Gifford Barkers Hill Semley Oare Roundway Chiseldon Newton Tony Compton Bassett Bullenhill Willesley Chelworth Little Abbots Charlcutt King's Corner Chilmark Middle Coombe Upavon Broad Blunsdon Lower Studley Pewsey Wharf Waterhay Hackthorn Manningford Bruce Yarnfield Maddington Chapel Plaister Calstone Wellington West Kington Wick Westlea Rodbourne Stapleford Easton Royal Medbourne Gomeldon Sheldon Corner Orcheston East Grafton Whittonditch Etchilhampton The Prinnels Fifield Bavant Drynham Horningsham Walcot West Little Horton East Stowell Milbourne Wild Duck Mead Sem Hill Whiteparish Alton Bishopstone Fugglestone St Peter Upper Wraxall Okus Barford St Martin Marten Membury West Stowell Faberstown Huish Coombe Hyde Thoulstone Restrop Ratford Maiden Bradley Stibb Green Milton Lilbourne Churchfields Pie Corner Easton Huntenhull Green Compton Chamberlayne Allington Baydon Thingley Townsend Cricklade Hilperton Marsh Potterne Little Marsh Horsey Down Ivy Mead Tisbury Rollestone Camp The Linleys The Splatts Low Bridge Conkwell West Sharcott Westdown Camp Ludgershall Westbrook Brigmerston Seend Head East Tytherton Redlynch The Friary Roughmoor Horsedown Normanton Mid Wilts Way Tidworth Camp East Town Brooklands Latton Upper Upham Aughton Slaughterford Kingsdown Great Cheverell Sutton Row Littleworth Sedgehill Corner Woodlands The Pry Hurdcott Derry Fields Martinslade Westmead Holt Lower Chicksgrove Cold Harbour Nursteed Woodbridge Highway Lower Pertwood Underhill Church End Bishops Cannings Northbrook Steeple Langford White Cross Winterbourne Dauntsey The Middles Great Chalfield Mead End Turleigh Stratton St Margaret Greenman's Lane Alderbury Widham Hailstone Hill Crofton Minety Teffont Magna North End Yatton Keynell West Crudwell Lackham Corston Buttermere Leigh Delamere Brokerswood Bowerhill Bemerton Heath Marden Little Ashley Elcombe Bradenstoke Burton Hisomley Everleigh Devizes Bradford-on-Avon St Katharine's Henley Coombe Bissett Chittoe Heath Beechingstoke Hanging Langford Bushton Stratford Tony New Zealand Swan Clench Common Figheldean Washwell Chelworth Upper Green Chute Standen Wardour Calne Bowerchalke Preston Lower Moor Tollard Royal Compton Great Hinton Warminster Common Sandy Lane Kinghay Dauntsey Old Dilton The Common Marlborough Penknap South Wraxall The Rectangle Gore Cross Monkton Farleigh Broad Chalke Alton Barnes Green Hill Fox Holes Woodminton Outmarsh Longbridge Deverill Charlton Heath Upper Studley Easton Piercy Higher Coombe Southend Upper Town Little Durnford Shrewton Longstreet Porton Easton Town Wylye Hodson Cotmarsh Stoford Royal Wootton Bassett Portash Wedhampton Lower Stanton St Quintin Upper Chute Patney Eastcourt West Lavington Moredon Purton Stoke Ratfyn All Cannings Chippenham West Overton New Town Minety Common Charlton St Peter Burton Swanborough Sharcott Norton Ford Sturford Beanacre Lea Upper Minety Rudloe Ham Green South Marston Little Langford East Sharcott Lockeridge Dene Ramsbury Avoncliff The Shoe Charnage West Chisenbury Newbury Startley Bemerton Derry Hill Eastcott Wroughton Tytherington Marridge Hill Nunton Inmarsh Worton Bodenham Kingsdown Salterton Kilmington Woodsend Middleleaze Thornend Gastard West Kington Semington Chittoe The Causeway Eldene Chirton Bourton Birdbush Tockenham Manton Chelworth Lower Green Freshbrook Lydiard Green Rowde Brokenborough Haxton Jockey Green Berwick St John Lower Westwood Wilsford Eastrop Upper Chicksgrove Gare Hill Upton Lovell Alcombe Dauntsey Lock Winterbourne Stoke Walcot East Chitterne Town's End Hullavington Chatter Alley Stanton Fitzwarren Bapton Lydiard Millicent Fittleton Nettleton Shrub Woodborough Brunton