Company Administration FAQs

Company Administration FAQs

What is an Administration order?

An administration order is an official procedure which protects a company whilst primarily focusing on rescuing an insolvent company.

How much protection does an Administration order provide?

The order stops creditors from taking any further legal action. These include the activity of bailiffs, landlords and even Revenue and Customs.

How much does an Administration order cost?

Depending on the time put into the process, the creditors will ultimately agree how the total cost of the Administration order is paid out. Usually, the payment is taken out of the recovery of assets where the director not being responsible for making payments.

What role do my secured creditors play?

These creditors must agree with the plan of action and be kept informed throughout the process.

Can any secured creditor appoint an Administrator?

No, this will need to be a fixed and floating charge holder.

How long does an Administration order last?

Usually for a 12 month period, however, it can be extended by the consent of the creditors or court.

Who runs the company during the Administration process?

The Administrators take over the running of the company.

What are the possible conclusions which can come out of the Administration process?

Depending on how the order proceeds, a company could:

  • Sell its assets through a management buyout or third party
  • Become liquidated (all assets are sold to pay off debts)
  • Agree on a Customer Voluntary Arrangement to agree on how creditors will be repaid
  • The company may be dissolved (simply stop existing)

About the Author

Mark Jefferson
Mark Jefferson is a seasoned commercial finance professional with over 25 years’ experience in financial services, much of that spent providing funding to SMEs. Mark has worked with many other firms in a similar situation to yours. Call Mark on 0800 157 7355 and you can also follow him on Google+

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