The Liquidator will;
- Take control of, and realise the assets of the insolvent company
- Distribute available funds to proven creditors
- Investigate the affairs of the company
- Report to ASIC any issues found through the investigation process
- Consider various legal actions against debtors, creditors and others
The effect of a Creditors’ Voluntary liquidation?
When a liquidator is appointed, the directors powers are immediately suspended.
The liquidator takes control of the company and reports to the creditors and the ASIC. The directors are obliged to assist the Liquidator in the winding up process.
Once appointed, the liquidator will take control of, and sell the remaining assets as well as undertake an investigation in order to explain the reasons for the company’s failure.
What is expected of directors in a Creditors Voluntary Liquidation? Directors are required by law to assist the liquidator. In this regard, the liquidator may require a director to provide:
- details of all the assets and liabilities of the company at the date of liquidation
- all the company’s books and records
- explanations of transactions of the company
- explanations of the use of company funds or property
If the Liquidator believes there has been any breaches of the Corporations Act, he will report to the ASIC and the creditors who will consider the appropriate course of action in the circumstances.