The current economic outlook is to say the least, uncertain. Economic questions cloud the future. Interest rates, inflation, and the ongoing implications of Brexit have an impact. As does the consequences of global warming and the conflict in Europe and further afield. Forthcoming elections both here and abroad also make it harder to understand a business’ viability trading forward.
The Macroeconomic Environment Impacts Businesses
There will always be insolvencies. This does not have to be a reflection of the directors and individuals involved. Businesses fail for many reasons. Often this is not a result of decisions taken by directors or stakeholders. These issues are frequently outside of day to day trading decisions. And more likely to be a result of the macroeconomic environment.
Making the decision to cease to trade or perhaps liquidate a company, will be a difficult one. BUT in the right circumstances, a positive decision. A decision that should not be viewed as a stigma. In fact, such a decision could help protect a director from exposure.
What might seem to be a multitude of issues can be resolved through liquidation, thereby providing the opportunity to rationalize or recommence trading with a new business that is better equipped into the future.
Many directors naturally worry about employees, unpaid bounce back loans, overdrawn directors loan accounts and personal guarantees that might have been given. These however need not be problems and in the first instance, before taking any decisions, these can be talked through to examine the issues to facilitate a strategy which may result in the rescue of the company. Or at the very least provide directors with the information to move forward armed with the knowledge to protect their future and take the right decisions.
Understanding when to get advice from an Insolvency Practitioner
When creditors start piling on the pressure, it’s crucial to seek advice ASAP to spot and tackle any issues head-on.
Local insolvency practitioner Hayley Maddison, Director of Maidment Judd says
Advice is free, confidential and of no obligation to take immediate action. Seeking professional advice should not be viewed as admitting defeat but as a sensible, proactive and responsible action for any company director to take.
Don’t put off getting advice from a licensed insolvency practitioner. Seeking advice sooner, opens up more options and can protect directors’ personal positions. Because by understanding what you can and can’t do, ensures you make the right decisions.
Do get in touch if you would like to discuss your accounting or tax needs – you can call us on 01992 444466 or email directors@hbaccountants.co.uk
The information contained above is for general guidance purposes only. Whilst every effort has been made to ensure the contents are accurate, please note that each individual has different circumstances and it is essential that you seek appropriate professional advice before you act on any of the information contained herein. HB Accountants can accept no liability for any errors
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