insolveny-in-ireland-when-insolvency-can-be-to-your-benefit-2-300x200When you come to the point that your business is experiencing insolvency, the courts may determine that you need help due to your company’s financial status, and though examinership can be helpful, you should remember that an examiner is appointed by the court and you must do what they say. Failing to follow their instructions will result in your business being liquidated.

Working for Creditors

At this stage of the game, you are no longer working for yourself, but for your creditors. This is an important distinction and it is the job of the examiner to determine if your business can do this and how. Which is why it is imperative that you follow their instructions to the letter. On the other end of the process, your business could become solvent again.

Examiners can be Invited

An examiner is someone who comes into your business and basically assesses it from top to bottom. They are looking to see if your company can meet its current obligations and if not they will advise you on how to do things better. If you begin to see signs that your business is floundering and want to avoid a court appointed examinership, it is wise to invite an independent firm to come in and basically do the same thing.

Turning things Around

In much, the same way you can come under stress, so can your business and turning it around can be difficult in both situations. Sometimes it means trimming the fat, cutting back on expenses when you are talking about business. It could even mean you must scale back on employees but if it means the difference between a functioning business and a liquidation situation, the short-term pain is worth the long-term goals.

This will require you to look at your business differently if you have any desire to come out of insolvency. Again, this is where examinership can be very beneficial. They will look at your business through fresh eyes and without the emotional attachments you have, which basically means they can make cuts that are simply too painful for you to execute. Since you are in the heat of the moment it might be difficult to see the simplest solutions to turning your business around.

There may come a time when examinership simply cannot help you save the business and you must liquidate. This is hard news for any business owner to hear, but remember these people are highly skilled and very thoroughly vetted, if they say the business is over you can take it to the bank. There is a temptation to ignore examiners findings, particularly when you have invited them into your business. Nevertheless, your interests will be best served by paying attention to what they have to say and following their instructions, even when you do not have to.

This article was written by Robert Potter of RP Consulting, a professional process and training company based in Dublin, Ireland. For more information and advice Contact Us here