Group News
Seeking advice - a strength not a white flag
The prospect of meeting with an Insolvency Practitioner is often met with dread – we don’t take it personally, and are reassured at the end of the meeting that our intentions are clear – we're there to help. The warning signs of financial distress are rarely invisible. It is that the instinct to keep going, to hope conditions improve, can override the harder conversation about what actually needs to change. Our role is to avoid a business going through a formal insolvency process where possible and support business change.
IPs do not have access to a secret formula that directors lack. What we offer is the ability to step back and look at the whole picture at a moment when directors are, understandably, deep in the day-to-day - focused on making payroll, getting through an inspection, managing a difficult supplier. Sometimes what a business needs most is someone who can take that holistic view.
Any credible recovery plan needs to account for more than one outcome - a plan that only works if everything goes well is not really a plan. Directors need to think through Plan A, Plan B and, if necessary, Plan C. If Plan C is a formal insolvency process, it is far better to have considered that early and prepared accordingly than to arrive at it unprepared and out of options.
Planning ahead protects creditors, but it also protects directors from the legal consequences of failing to meet their duties.
In practice, creditor management, including engaging with HMRC, is often where Plan A starts. HMRC liabilities can have a habit of building up, partly because trade suppliers, who need to keep delivering, tend to get paid first. By the time the HMRC position becomes visible, it can already be substantial.
Our Business Advisory Team agreed over 222 formal Time to Pay arrangements last year, allowing businesses to address their liabilities and continue trading. The importance here is ‘formal’ as we do occasionally see businesses who believe they have a Time to Pay arrangement in place but do not.
The businesses that find their way through are usually the ones where the director made one good decision early enough to matter: they called someone. The people best placed to point them in the right direction are usually already involved in the business, the accountant, the solicitor, the existing lender. Those trusted advisers know the business, and they know when specialist support is needed.
The single most important piece of advice is simply not to wait.
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Leonard Curtis is a trading style of Reach Commercial Finance Limited, registered at Riverside House, Irwell Street, Manchester, M3 5EN. Company Register number is 09056450. Reach Commercial Finance Limited is authorised and regulated by the Financial Conduct Authority, FRN: 753686. Reach Commercial Finance Limited is an authorised credit broker and not a lender. We work with an unrestricted number of lenders to find a potentially suitable arrangement for your consideration. ICO registration ZA069234 and you can check via www.ico.org.uk. We will receive commission from lenders. Different lenders pay different amounts depending on different commission models. For transparency we work with the following commission models: fixed fee, fixed rate of commission, percentage of the amount you borrow and rate for risk (this is based on the risk profile of the business). Further details of the commission model, calculation and amount will be disclosed to you throughout your customer journey. Privacy notice.
Leonard Curtis Legal Limited is a limited company, registered in England and Wales with registered number 09820186. Registered office: Riverside House, Irwell Street, Manchester M3 5EN. Leonard Curtis Legal Limited is registered with the Solicitors Regulation Authority with number 626004.