Voluntary Administration And COVID-19

If your company is struggling to stay financially viable, or you may suspect that it is insolvent, you may be considering voluntary administration. Voluntary administration is an insolvency process where an external administrator manages your company's assets while it restructures. Businesses complete this process in aims to hopefully avoid liquidation. This article explains how voluntary administration works, including:

• how it differs from liquidation;
• the processes involved;
• the effect on creditors; and
• whether to utilise this restructuring technique amongst the COVID-19 pandemic.

What Is Voluntary Administration?

Voluntary administration is a restructuring process which provides a mechanism to maximise the chances of your company continuing. At the very least, voluntary administration provides a better return to your company's creditors.