The Insolvency Firm Supporting SME Directors in Financial Distress
Boutique & Experienced. Insolvency Firm Specialists.
Expert Insolvency Practitioners for Business Restructuring & Turnaround.
As a leading insolvency firm in Australia, IRT Advisory has vast experience in advising businesses in financial difficulty, often through no fault of their own. If any of the five points below ring true, you should consult an insolvency practitioner now. Speaking with an insolvency expert early is the best way to protect your business before the situation gets out of control.
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We are specialists in Business Restructuring, Business Turnaround and Corporate Recovery.
Hear Directly From IRT Experts
What is an Registered Insolvency Practitioner?
A corporate insolvency practitioner is a qualified, experienced, licensed and insured accounting professional who helps deal with companies that cannot pay their debts. In Australia, they are called Registered Liquidators, authorised under the Corporations Act and regulated by ASIC.
They administer formal processes such as voluntary administration, liquidation, and small business restructuring. Their role is to independently assess the company’s financial position and manage the process in accordance with the law, while acting in the interests of creditors as a whole. Beware of persons holding themselves out as ‘insolvency experts’ who are unqualified or unregistered.
When should I contact an insolvency expert?
You should seek advice as soon as you are concerned your business may be unable to pay its debts. Warning signs can include ongoing cash flow problems, unpaid tax or creditors, increasing pressure from lenders or suppliers and enforcement action commenced by creditors or the ATO.
Obtaining advice early can give directors more options, including the possibility of restructuring the business or negotiating with creditors. Early advice can also help directors understand and manage their legal duties if the company may be insolvent.
How much does an insolvency practitioner cost?
The cost of engaging an insolvency practitioner varies depending on the complexity of the matter and the type of work required. Factors such as the size of the business, the number of creditors, the quality of the company’s records, and whether assets need to be realised can all affect the time involved.
In most formal insolvency appointments, the practitioner’s fees are subject to creditor approval and must be reasonable for the work performed. Before accepting an appointment, an insolvency practitioner will usually provide an estimate of the likely costs and explain how their fees will be calculated.
Who regulates insolvency practitioners in Australia?
In Australia, insolvency practitioners who handle corporate insolvency matters are regulated by the Australian Securities and Investments Commission (ASIC). Registered liquidators must meet strict professional and ethical standards and are subject to ongoing regulatory oversight.
In addition to ASIC regulation, many insolvency practitioners are members of professional bodies such as the Australian Restructuring Insolvency & Turnaround Association (ARITA) and the Association of Independent Insolvency Practitioners (AIIP), which promote professional standards and best practice within the profession.
What is the difference between a liquidator and an insolvency practitioner?
An insolvency practitioner is a broad term used to describe professionals who administer formal insolvency processes for businesses and individuals that cannot pay their debts.
A liquidator is a specific type of insolvency practitioner appointed to administer the affairs of a company. Their role is to realise the company’s assets, investigate its affairs, and distribute available funds to creditors in accordance with the law.
Registered trustees in bankruptcy also come under the umbrella term ‘insolvency practitioner’. Their role is the administer the affairs of individuals who become insolvent, through either bankruptcy or a personal insolvency agreement.
Do I need an insolvency practitioner for a struggling small business?
Not necessarily, but obtaining early advice can be very helpful. If a business is experiencing financial stress, an insolvency practitioner can assess its position and explain the options available.
In some cases, the business may be able to recover through informal restructuring or negotiations with creditors. In other situations, a formal process such as small business restructuring, voluntary administration, or liquidation may be appropriate. Early advice can help directors understand their options and their legal responsibilities.
How do I find a registered insolvency practitioner?
You can verify a professional’s credentials by checking the ASIC Registered Liquidators register. It is also highly recommended to work with members of ARITA or AIIP, who are committed to the highest professional and ethical standards in Australia. IRT Advisory offers access to experienced, registered practitioners ready to assist.
What does an insolvency practitioner actually do?
Their primary role is to investigate the financial affairs of a distressed company, identify available assets, and determine the most equitable path forward for all stakeholders. This may involve restructuring the business to ensure continuity, negotiating with creditors (such as the ATO), or liquidating assets to repay debts.
What happens to directors during an insolvency process?
Directors remain key stakeholders but (with the exception of Small Business Restructuring) they lose control of day-to-day operations once an external administrator or liquidator is appointed. They are required to assist by providing company records, completing a Report on Company Activities and Property (ROCAP), and making themselves available for questions. Directors may also be subject to review regarding potential breaches of duty, insolvent trading or preferential payments. However, directors can limit their potential personal exposure by cooperating fully and acting in good faith throughout the process.
Under Small Business Restructuring, directors remain in control of the company throughout the process but are required to work with the Restructuring Practitioner to develop and implement a restructuring plan.
Can an insolvency practitioner help me avoid bankruptcy?
Yes, in many cases an insolvency practitioner can help explore options aimed at reducing the potential for personal bankruptcy. By reviewing the financial position of the business and its directors, they can identify potential restructuring strategies, negotiate with creditors, or implement a formal restructuring process where appropriate. The personal exposure of company directors can be mitigated with the right strategies adopted at the business level.
Seeking advice early is important, as it often provides more options and may help resolve financial difficulties before they escalate.
How do insolvency appointments affect employees and creditors?
Employees generally have priority entitlements in a liquidation, covering unpaid wages, superannuation, leave, and in some cases redundancy. Entitlements other than superannuation can also be supported by the Commonwealth’s Fair Entitlements Guarantee (FEG) scheme. Creditors are notified of the appointment and receive detailed reports outlining the company’s financial position and estimated returns. While in many cases unsecured creditors may not recover the full amount owed, professional management of the process ensures that assets are realised fairly, distributions are transparent, and statutory reporting obligations are met.
