Phil MeekinView Profile
Although its primary motive is to save businesses rather than close them, an insolvency practitioner and the insolvency industry in general, doesn’t always have a positive public perception.
Insolvency and the professionals occupied in the industry are often perceived as a less than desirable one to encounter, with those needing its services regarded as failures or unsuccessful.
Why the bad reputation?
Professionals within the insolvency industry often get a bad reputation. A lot of this is down to non-regulated bodies claiming to be business advisors or turnaround specialists. These companies usually have few, if any, formal qualifications and little technical knowledge of insolvency legislation.
Additionally, insolvency practitioners get tarnished with the same brush as solicitors and lawyers; perceived as looking to close companies with a reverence.
In actuality, the majority of insolvency procedures are designed to help companies recover, allowing them to continue trading free of their old debts. Company closure through liquidation is often the last resort if the debt is too burdensome to recover from, or if previous attempts at other insolvency arrangements have failed.
Licensed and authorised
Consumers should be reassured an insolvency practitioner is licensed and authorised by The Secretary of State. Practitioners undergo a stringent series of tests on their technical knowledge by way of a series of exams. Additionally, an insolvency practitioner must have a specified number of hours of insolvency experience to apply for a licence.
Once receiving a licence, an IP must complete the requisite number of training hours per year to ensure they are up to date with the very latest technical knowledge.
An insolvency practitioner abides by a code of ethics which include integrity and competence. So, you should be confident when dealing with an IP that they will handle matters professionally. Remember, you can approach an Insolvency Practitioner directly for advice, and most will offer a free consultation at the very least.
Although insolvency practitioners tend to receive a bad reputation, perceived as relishing in the closure of businesses, their primary goal is to help a company recover from its debts to avoid closure.
Much of the insolvency industry’s negative stigma comes from companies claiming to offer advice and insolvency solutions, with little if any licensed experience. In actual fact, once qualified, IPs are monitored by regulatory bodies to ensure they maintain compliance.