The liquidation Is a situation where the company faces financial difficulties or realizes that they are becoming Insolvent or Is likely to become Insolvent I. E. Not able to pay the debts. [Color T. And Antonio, 2009, When on finalization of allocation conducted by the liquidator It was found that the company will not be able to pay the debts of unsecured creditors, the company should be triggered because liquidation is considered as the orderly winding up of the Company. [ASIA Information Sheet, 2008] [2] The deregistration of the Company also results in the capital loss.
Once the company is triggered it no more remains the member of consolidated group as it ceases to exist. [Consolidated Reference manual, 2011] [3] Although it was find by the creditors liquidation that Mr.. Shifty and his company is not involved in the insolvency of the company this time but it was also found that they are engaged in similar kind of business from past 9 months. First of all it is a duty of the Director not to trade while insolvent I. E. Whenever taking any new debt it is the duty of the director to check that whether his company is in insolvency or avian the chance of become insolvent.
There are various penalties for the directors who continue to trade while being insolvent, civil penalty or pecuniary penalty of $200,000, in addition to this, compensatory penalties can also be imposed on the directors. The director may be held personally liable for the debts as a consequence to this. In order to take insolvent action against the director of any insolvent Company, it is generally presumed by ASIA that the company was insolvent throughout the period since it cannot shown that it failed to maintain proper financial records. As Mr..
Alan is also the chairman and majority shareholder of Broodmares Pity Ltd. Breadboards needs to borrow $1. 5 million to fund its latest purchase. It already has a large overdraft and has no unencumbered Question 3: Company A ( which markets computers software ) and company B ( which run a computer training college) Assume company C is not registered within the two – month period. What remedies does company Y have and against whom? Question 4: Stephen is in financial difficulty. He approaches his cousin, Julia, and asks if she is interested in purchasing his shareholding of 2000 shares in Rosenthal. Julia
