Why it’s important to speak to a licensed insolvency practitioner

If you’re concerned about the financial position your company is facing, or you’re an individual seeking financial support, it’s important to get advice as soon as you can. Going straight to an insolvency practitioner will cut out any resemblance of a ‘Middleman’ and remove any possible unregulated advice. Often people who provide financial advice are not licensed or regulated to do so, unlike licensed insolvency practitioners such as those at Wilson Field.

How do I know if an IP is Licensed?

Certain procedures, such as liquidation, can only be carried out by a licenced insolvency practitioner. All insolvency practitioners need to be licensed and regulated by a regulatory body such as the ICAEW. They must also follow the regulations in the Insolvency Act 1986 and the Insolvency Rules 1986.

There are financial advisors and ‘unlicensed insolvency practitioners’ who can give advice. However, it is worth noting these advisors may:

• Not follow regulations as per the Insolvency Act 1986.
• Charge an up-front fee before acting.
• Be a third party that could charge their own fee before passing you to an insolvency practitioner.
• Not thoroughly explain the process your company is entering.

There are various licensing and regulating bodies for insolvency practitioners, which you can check to ensure you’re speaking to a licensed insolvency practitioner.

We are licensed by the ICAEW

Wilson Field has Insolvency Practitioners who are licensed by the Institute of Chartered Accountants in England and Wales – which means we are licensed to provide advice and undertake insolvency appointments.

When may I need an insolvency practitioner and what do they do?

By getting in touch with an insolvency practitioner, they will be able to advise you on the best way to proceed with any financial difficulties your company is facing. They will look at what you are trying to achieve as an outcome for your company, what solutions could be available, and what works for you on a personal level. As part of an insolvency practitioner’s duties, they will also look to maximise profits for a creditor in any kind of liquidation or repayment plan.

As a director, you must be aware of your company’s financial position at all times and watch out for signs of deterioration. Common warning signs of a struggling (or soon-to-be struggling) business include, but are not limited to:

• Lack of finance to support your company’s growth strategy.
• Cash flow problems.
• Falling profits.
• Accrued debts with HMRC.
• Inability to pay liabilities when they fall due. 

Insolvency Practitioners will also look help individuals who are looking at personal financial problems. This could be through looking at bankruptcy options, or repayment plans.

How do I know if my company is solvent?

There are specific tests that a director can do to help establish the solvent position of their company. However, these tests cannot say as a certainty whether your company is solvent or insolvent.

• Cash Flow Test
  If a company cannot pay their bills and liabilities as and when they fall due, they may be classed as insolvent.
• Balance Sheet Test
  If your company’s liabilities exceed the value of its assets, then the company is insolvent. What you owe to creditors should not be more than the value of your company’s assets.
• Legal Action
  Your company could have received warning signs from creditors, with threats of legal action such as County Court Judgements, statutory demands or winding-up petitions.

Are you looking for an insolvency practitioner? We can help

We are a licensed insolvency practice firm and our initial advisors can offer, free, confidential and impartial advice exploring your financial situation and will help you look at what kind of outcome you desire and then look at the best ways of moving forward.

We will then offer a free meeting with one of our consultants who will then explore your options in greater detail, with no obligation.

If you do require one of our services, our licenced and regulated insolvency practitioner will carry out the right procedure and process with you.

In summary

An insolvency practitioner can carry out a wide variety of roles for both companies and individuals that require help. They offer help and advice regarding all aspects of insolvency, including business finance and turnaround procedures. Some financial advisors may claim to offer advice and services, but unless they are licenced, they will not be able to provide these services. The main obligation of an IP is to the creditors of the company or individual and give them the best possible return

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