Factoring and Invoice Discounting Helpline

As a business Director you can be held personally liable for your actions and the actions of the business as a whole. This means that you can be responsible for significant amounts of money and you can be at risk of receiving prison sentences for certain types of misconduct.

Going through Administration or insolvency can be very stressful and overwhelming, and it can be confusing and daunting knowing what you should do for the best. To help you there are a few do's and don't for directors.

Do's

• Act as quickly as possible as soon as you think there may be financial difficulties
• Notify the board, and hold regular board and management meetings
• Keep accurate minutes of meetings, so there is a record of what you have been doing to resolve the insolvency
• Keep a written record of all difficult decisions taken
• Keep accurate and up to date financial records, have a clear picture of assets and liabilities
• Sell assets for their true market value
• Submit tax returns and accounts on time, and pay taxes when they are due
• Respond to petitions within the time frame stated otherwise your business facilities may be frozen
• Communicate with staff, creditors, customers and your bank
• Make a plan for dealing with the insolvency and get the board to support it
• Take advice from professionals and keep a record of what they say

Don'ts

• Don't keep trading if your are insolvent, unless you are sure you can turnaround your business
• Don't write cheques or arrange more credit if you cant repay it
• Don't accepts orders if your can't fulfill them
• Don't lie to your bank or creditors
• Don't pay creditors in preference
• Don't ignore final demands, judgments or petitions
• Don't wait to see how things work out- take immediate action
• Don't resign- as a Director you are responsible for implementing a procedure to deal with the insolvency
• Don't waste time blaming people for what has happened - instead take action to resolve it

Professional advice

Business turnaround specialists and insolvency practitioners are experienced in dealing with businesses in or facing insolvency so it is worth taking some free advice before you decide on a course of action. A professional will be able to explain all the options available to you, plus the risks and benefits of each choice; they will also be able to help you put your chosen plan of action in place.

To understand the whole range of options and to get help choosing the right one for your business contact us on 0800 597 4757 or enquire online using the form opposite.