Why Liquidators Ask For Funding

A common question I am often asked as a Registered Liquidator is:

“If a company is in liquidation, how do you, as the liquidator, get paid?”

It is a good question. Generally, the costs of any liquidation are met from the available assets of the company, with proceeds distributed in accordance with the statutory priority regime under Section 556 of the Corporations Act 2001 (‘the Act”).

However, many companies that are wound up have little or no assets available to fund the liquidator’s investigations or recovery action.

During the course of a liquidation, a liquidator may also receive funding from other external sources including:

• Director Contributions

• ASIC Assetless Administration Fund