Businesses today operate in an increasingly dynamic and competitive environment. Slowing growth patterns, increased competition and an uncertain economic outlook all present threats to performance and viability.
A company can face unexpected cash flow problems, even if it is trading profitably. Often it can trade out of temporary cash flow problems without external assistance. However, if this cannot be achieved, Voluntary Administration provides a framework for a company and its creditors to negotiate a compromise, whilst protecting the key stakeholders.
A Voluntary Administration is an invaluable tool available to companies facing financial stress. At times, it will be the only avenue available to a company to address its short term financial problems and return it to a position of financial strength.