Insolvency practitioners are authorized and licensed personnel who work hand in hand with an insolvent limited company, individual, and partnership. Licensed practitioners can either be solicitors, insolvency specialists or accountants acting within a law firm or accountancy.
Qualification of Insolvency practitioners
• Must have a valid license
• Must have cleared with insolvency examinations body (JIEB exams);
• Should have acquired experience and knowledge in insolvency duties;
• Must have satisfied a regulator (also called an authorizing organization) that they are suitable and fit to perform as a competent IP.
Duties of the Insolvency Practitioners
Although their duties vary slightly basing on the specific sort of procedure, the basic roles of the IP involve assessing company asset in a detailed way possible. This will entail a sum of tasks, involving handling the company creditors, especially when the need for rescue procedure arises like administration, giving the recommendation about how the firm may get rid of liquidation as well. Much of their duty is investigative, as well, as this specialist has a legal responsibility to scrutinize the activities of the firm directors to inspect for the likelihood of fraudulent or unlawful activity.
A licensed IP has a capability of undertaking appointments in and advising on, all official insolvency procedures comprising of, receiverships, liquidations procedure, bankruptcy, company voluntary procedure, individual voluntary schedules and management.
A procedure of recovering fund borrowed to a company and hand it to the company into the IP for a ‘secured creditor.
The insolvency practitioner normally can handle dealings within their proper duties:
• Individual voluntary arrangements
• Winding up petitions
• Company voluntary arrangements
• Creditors’ Voluntary liquidation
• Members’ Voluntary liquidation
The insolvency practitioner is hired to carry out difficult situations. For instance, their major task is to attempt to liberate a business. They sell the properties of the company or individual who owes cash. IP also collect fund due to the company or individual. They also agree on creditors’ entitlements and issue the fund gathered after disbursing costs.
The IP’s duty involves handling many rival interests, but typically their key role is to cater for the creditor’s interests. Even though creditors can provide information of their entitlements, IPs will disagree on the claims till they are certain that money will be available.
Furthermore, the IP will provide guidance to a borrower instantly before an official insolvency procedure begins. The Certificate of Insolvency offers a valuable overview of the duties of an IP.
It covers the fundamental principles but does not include an explanation of insolvency law in details or the whole thing about the duty of insolvency practitioner. It states how you can get rid of common misunderstandings.