WHAT IS VA
What is Voluntary Administration?
Voluntary Administration is a formal insolvency process designed to provide companies with breathing space to explore their options. It's often the first step when a company faces financial difficulties but may still be viable.
During this process, an independent administrator takes control of the company to investigate its affairs, assess its prospects, and determine the best course of action for creditors and the company.
Key Objective
Breathing Space to Assess Your Future
The primary objective of a Voluntary Administration is to give a financially distressed company breathing room to assess its future and decide on the best path forward. By appointing an independent administrator, the company gains immediate protection from creditor action while a fair proposal is prepared for creditors. The aim is to maximise the chances of the company's survival or, if that's not viable, to achieve a better outcome for creditors than an immediate liquidation.
Benefits of Voluntary Administration
Voluntary Administration provides immediate relief and structured pathways to explore the best options for your business and creditors.
Creditor Protection
Immediate protection from creditor actions and legal proceedings
Time to Assess
Breathing space to properly evaluate your business options
Expert Management
Independent administrator takes control to maximise outcomes
Fair Process
Equitable treatment of all stakeholders and creditors
The Administration Process
A structured 25-day process designed to assess all options and determine the best outcome for the company and its creditors.
Appointment
Administrator appointed by directors or creditors
Investigation
Comprehensive review of business affairs and options
Creditor Meeting
First meeting within 8 business days of appointment
Decision
Second meeting to decide the company's future within 25 business days
Possible Outcomes
At the second creditors' meeting, creditors will vote on one of several options for the company's future. Each outcome is designed to maximise value for stakeholders.
Deed of Company Arrangement
The most common successful outcomeA DOCA is a binding agreement between the company and its creditors that allows the company to continue operating while paying creditors according to agreed terms.
Have Questions About Voluntary Administration?
Time is critical in financial distress situations. Our experienced team can help you understand your options and guide you through the process.
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