A process commonly used, designed to preserve a company’s business, whilst its directors with the help of an insolvency practitioner, decide whether or not the business can survive or whether the business and assets can be sold to produce a better result for the creditors.

Anything owned by a company or individual that can be taken by law for the settlement of debts, this can include debts owed to the company or individual.

Person authorized by the County Court to collect a debt for a creditor, serve Court documents and execute warrants.

The procedure designed to deal with the affairs of an insolvent individual for the benefit of his/her creditors. A bankruptcy order will be made by the Court against the individual signifying that they are unable to pay their debts and depriving them of their property which is then realized for distribution amongst their creditors.

A procedure whereby a company sets out its proposals to repay some or all of its debts over a period of time to creditors or shareholders. The amount to be repaid and the length of time required to repay it will form the basis of the proposal. There is limited involvement by the court and the scheme is under the control of a supervisor.

The winding up of a company ordered by the Court, usually following a petition presented by a creditor.

The most common corporate insolvency process. It is usually commenced by resolution of the shareholders, but is under the effective control of the creditors, who can choose the liquidator.

A procedure whereby an individual makes a proposal to repay some or all of their debts over a period of time to creditors. The amount to be repaid and the length of time required to repay it will form the basis of the proposal. This scheme requires the approval of the Court and is under the control of a supervisor.

Person licensed by one of the Chartered Accountancy bodies, the Law Societies, the Insolvency Practitioners’ Association or the Department of Trade. The only person who may act as an Office Holder in an insolvency. Persons claiming to be insolvency practitioners, but who do not hold a licence may not be able to help you. The status of anyone claiming to be a licensed insolvency practitioner can be confirmed by contacting one of the regulatory bodies listed above.

Term for what the business owes. Can be long-term loans of the type used to finance the business or short-term debts or money owing as a result of trading activities to date.

Applies to companies or partnerships. It involves the gathering in, realization and distribution of the assets and usually the closing down of the business. There are three types of liquidation – compulsory, creditors’ voluntary and members’ voluntary.

A solvent liquidation where the shareholders appoint the Liquidator to realize assets and settle all the company’s debts, plus interest, in full within 12 months.

An officer of the Court and civil servant employed by The Department of Trade Insolvency Service who deals with bankruptcies and compulsory liquidations.

A company in administrative receivership is said to be in ‘receivership.

Alteration to the financial or operational aspects of the business to streamline procedures.

A creditor who holds security, such as a mortgage, over a person’s assets for money owed. A secured creditor gets paid first out of the proceeds of the sale of the security.

A person who has agreed to be, and is registered as, a member, such as a shareholder of a limited company.

In the case of a private company, this procedure might be a cost-effective procedure following a sale of assets and payment of creditors in full. It is not strictly an insolvency procedure, since it is not governed by the Insolvency Act or does not require a licensed insolvency practitioner. It is an alternative to an MVL.

A creditor who does not hold security (such as a mortgage) for money owed. More commonly used to refer to an ordinary creditor who has no preferential rights, although, in fact preferential creditors will almost always be unsecured. In any event, the last in the queue, ahead only of shareholders