PBC announce dividend from liquidation

PBC are pleased to report that having already paid preferential creditors in full a dividend of 9.72 pence in the pound was paid to unsecured creditors of GLA Stroud Limited when it was anticipated no funds would be available.

The company was placed into creditors’ voluntary liquidation on 4 June 2014 after the preceding company voluntary arrangement it had entered failed due to circumstances out of its control.

Joint liquidator, Gary Pettit, said, “Asset realisations in any construction industry insolvency can be complex but in this case they were significantly higher than originally anticipated with the retentions due to the company being recovered with the assistance of Leslie Keats.  Also, book debt recoveries were at 95% of the ledger which was achieved by pragmatic negotiation and assisted by good record keeping by the company in the first instance”.

Administration & Creditors’ Voluntary Liquidation

One common mistake that business owners, the press and many others make is to ask ‘is my business bankrupt’ or ‘can my business be bankrupt’. It is only possible for an individual to be bankrupt so a company will go through the process of liquidation or administration. In short, if you are looking at a company that is not in a position to pay the creditors and the situation is clearly not a short term issue then you may need to enter administration or liquidate.

This video clearly explains what the different processes are and Gavin Bates, one of our licenced insolvency practitioners with over 25 years experience, takes you through your options.

Northamptonshire Business Leader to Take Centre Stage at National Awards

A leading Northamptonshire businessman will take centre stage at national awards that will take place at Wembley stadium.

Gary Pettit, the managing director of PBC Business Recovery has been selected as a judge for the SME National Business Awards 2017 which were launched in July 2017 as a result of the continued success of the SME Business Awards around the UK.

The awards are directed at SMEs which at 98% of all businesses are the main engine of the UK economy.

“I am delighted both personally and for PBC Business Recovery that we have been asked to undertake such an important role in this influential and prestigious Awards.” said Gary.

PBC Business Recovery and Insolvency is a specialist business rescue and insolvency practice that provides practical, helpful advice and solutions to a variety of businesses and individuals with financial problems.

“Entering awards are a fantastic way to grow any business.” Gary continued. “An SME only needs to reach the finals of the awards to experience their profile and their promotional opportunities.”

“This is a great opportunity for SMEs from across Northamptonshire to get to Wembley later this year and be part of an amazing evening that will see the cream of UK business crowned.”

Businesses can enter up to 3 categories. There will be a selection of highly experienced and respected judges and each entry is judged by up to 4 of our panel.

Finalists will be chosen following the preliminary judging and they will be announced online on 4th October 2017.

The awards will culminate in a glitzy black-tie final at the iconic Wembley stadium on 1st December 2017.

The evening of celebration will recognise all the finalists and allow every business that reaches the final the opportunity to promote their incredible achievement.

Further information on the awards can be found at www.smenationals.co.uk

You can watch a video promoting the Awards at https://youtu.be/SdKLYldl9WQ

What is the difference between Corporate and Personal Insolvency?

When you realise you are potentially in a position where you or your company is insolvent you will need to take action as soon as possible. It is sadly not uncommon for corporate and personal insolvency to be bedfellows, but they are different so you will need to make sure you are approaching it from the right perspective. One of the very early discussions we often need to have with our clients is the difference between their personal and corporate financial responsibilities. Kym Carvell explains how to answer the question ‘what is personal insolvency’ and the difference between that and corporate insolvency in this video. She also discusses some of the confusion surrounding the liability status of sole traders and the common reasons why some companies can become insolvent.

What is a Voluntary Arrangement?

Voluntary Arrangements (VAs) are not a universal panacea for financial difficulties but they can be a way of resolving your financial issues to the satisfaction of everyone concerned. In this video licensed insolvency practitioner and director here at PBC, Gary Pettit, will explain what a voluntary arrangement is and what it can do.  Many people are aware of the basics of a VA but are unsure of a range of specifics such as can a company have a voluntary arrangement and do all creditors have to abide by the terms of a voluntary arrangement?  Gary will answer some of the more common questions we are asked about VAs and how they are used.

Personal Insolvency Rates – Women Overtake Men

figures

Every quarter the Insolvency Service produce statistics which confirm how many businesses fail, broken down by insolvency type:, liquidations (whether they are compulsory or voluntary) administration or company voluntary arrangements (CVAs).

At the same time similar statistics are released for individuals, divided into bankruptcies, debt relief orders or individual voluntary arrangements (IVAs). There are very few details about the number of debt management plans.

When these are released, the details will always make that day’s news and as is normal with the media they focus on the worst points.

In general terms, corporate insolvency appointments have been failing from their recent highs reached during the financial crash in 2007/08 (although failures were much higher in the early 1990’s). Personal insolvency appointments have also been falling, although in the last year there has seen a steady rise. Historically men have always had higher rates of insolvency than women but since 2014, women have overtaken men.

Once a year the Insolvency Service produce more detailed personal insolvency statistics. The main headlines are:

  • The total insolvency rate increased for the first time since 2009, and increased in all regions of England and Wales between 2015 and 2016.
  • The North East continued to have the highest insolvency rates, while London had the lowest.
  • Nine out of ten local authorities with the lowest insolvency rates were in London or the South East, whilst seven out of the ten areas with the highest rates were located in coastal areas.
  • Insolvency rates increased for all age groups except 55 and over, with those aged between 18-44 showed the biggest rises.

 

When I review these figures I am always interested in the details. For example Corby has been in the top 10 of the worst local authority areas in terms of personal insolvency rates.  As mentioned above the majority are seaside towns which have their own issues due to the seasonal economies in which they operate.  Being based in Northampton we are aware that Corby still has elements of poor families struggling to make ends meet in low paid jobs.  In our experience these will often be cases in which credits cards and loans have been built up, possibly in a period when there has been a loss of income or ill health or just simple overspending.  Commonly once the debt has been built up they find it almost impossible to repay the debt because of the low income and so a downward spiral begins.

So what can the individual do?

The first thing required is to be honest with yourself and the situation. Sit down and summarise who you owe money to and how much.  Next produce a budget detailing your income and necessary spending.  Hopefully this should leave a surplus and you can then plan how to reduce your debt using this surplus.

You may find you need additional help and PBC have always offered help to individuals and will outline all the options open to them from refinancing, a debt management plan, IVA’s and bankruptcy, alone with many others. Our advice is simple: take action as soon as possible rather than leaving it too late.

Initial meeting are free of charge and confidential. We hope to understand your position, answer your questions and lay out the options available to you in order for you to consider which is the best way forward for you.

UPDATED TOTAL- Charity Walk Completed!

Kym and Jamie completed their 80 mile charity walk for Ronald McDonald Houses earlier this month. They have currently raised £2,047 and have therefore exceeded their amended target of £2,000, which itself was double their original goal.

 

Kym’s daily blogs, reproduced below, provide the highlights of their four days walking:

 

Day 1 blog: I’ve seen Wembley Stadium, Regents Park, Grenfell Tower (so sad), nesting moorhens with chicks and swans with cygnets, a green woodpecker, some handsome dogs (shame about some of the owners) and a lorry driver about 3ft away mount the pavement and take out a bollard (male naturally)! I’ve learned that London cyclists are rude and my efforts to teach them manners whilst amusing for me, were largely wasted, Jamie can’t multi task and his attempts to look at his glasses while holding a drink meant that I would end up wearing it! I’ve learned that Billie-Marie is back in Alder Hey which has made us more determined and that there are a lot of generous people out there, thank you so much to everyone who has donated. Day 1 done we’re on our way home tired and dirty. Day 2 starts at 7am tomorrow as we had to cut today a little shorter than planned because Jamie somehow has managed to lock his lovely wife Naomi out of their home!

 

Day 2 blog: Tough today as the heat made it hard! Today we’ve seen 3 herons, a red kite and a couple of guys appearing to be picking nits from each other’s hair! It was a more picturesque walk today along the canal path, a lot less pavement pounding. Well-mannered cyclists, friendly people except one rude guy at Watford where we also saw the days first builders bum and thankfully the only one! Is that really necessary? Must be quite uncomfortable and draughty! Jamie is suffering nasty blisters today and I have put the blister pack “in a safe place” but can’t remember where! Sorry J! Our other silly moment was forgetting to pay for parking in Northampton! Oops! Half way through now time wise though a few more miles to cover the next 2 days so early start tomorrow for day 3! We can do this!!

 

Day 3 blog: Off to an early start today at Tring. As my back and shoulders are surprisingly sorer than anything else I’ve decided to ditch the back pack, use a bum bag and let Jamie carry the weight! Not sure this look will catch on again so may try to up the game tomorrow and rock in socks and sandals as well! The new waist attire has taken a soaking with Jamie’s 2nd throw of a drink over me as has my phone! Today I’ve seen the most beautiful countryside and my senses have been assaulted by the less pleasant aromas that come with it! I’ve seen horses running together, a couple of boat cats, stunning wildlife and a doberman belly flop into the canal to chase geese which naturally flew away leaving the dog unable to get back out again! Help was at hand and all ended well but it was funny. Everyone we’ve met has been lovely despite Jamie’s groans of pain about his blisters! In fairness they are really bad poor lad. My legs are feeling it now but we’re almost there and I’m determined to finish even if I do so on my hands and knees.

Day 4 blog: Off to an early start again and just finished! Woohoo 80 miles over 4 days completed with lots of laughs and groans of pain along the way. Today I managed to spill my own drink on me, thought I’d give Jamie a break from doing it! We’ve had donations from strangers including the owners of Zack the greyhound who took a liking to me, seen beautiful views including common terns, had a close encounter with a heron and learned that the names Rosie and Jane appear on more barges than any other name. I have asked myself over the last few days why I accepted this fundraising challenge from someone almost 30 years younger than me but we’ve done it! Would I do it again, hell yes! Growing old is compulsory growing up and acting your age is optional and the latter is my choice and the way I plan to continue. Most importantly, we’ve almost hit our target for Ronald McDonald House which is an amazing charity that gives so much help to families of sick children, more than I can begin to explain. Heartfelt thanks to everyone who has donated and to you all for your support and encouragement, much appreciated.

To donate, please click here.

Paying by card – know your rights!

Research by the UK Cards Association showed that, in 2016, 77% of national retail sales were made by card. It was also announced in the last few days by the British Retail Consortium that debit card payments overtook cash for the first time, no doubt increased by the use of contactless payment.

Most payments by credit card (including some charge cards) are protected by law: consumers have a legal claim against the card issuer where the goods or services cost between £100 and £30,000 and are not delivered.

In addition, for debit and credit cards (including pre-paid cards), the card schemes provide a system of “chargeback”. Chargeback schemes are voluntary schemes with the terms and conditions set by the card issuer and accordingly the rules vary from issuer to issuer.  However most schemes allow the card issuer to ask the merchant acquirer to reverse a payment made by card with no minimum or maximum limits.

It is unfortunately inevitable that some payments made for services will not be honoured when a retailer enters into insolvency. New guidance issued to insolvency practitioners states the appointed insolvency practitioner must issue a notice on the retailer’s website informing customers of whether their services or goods will be delivered, as well as informing them of the above rights.

The UK Cards Association has also issued a guide to card holder’s rights, which can be found here:

http://www.theukcardsassociation.org.uk/wm_documents/Credit%20and%20debit%20cards%20-%20A%20consumer%20guide%20June%202016%20FINAL.pdf

Ever Decreasing Circles

‘Living beyond means’ – a leading cause of bankruptcy

When you think of Ali Campbell you think of UB40, Shane Filan, Westlife and Martine McCutcheon may bring back memories of “Eastenders”. What they all have in common is being made bankrupt, which goes to prove cash is king.

There is an old joke about the husband who did not report his wife’s card stolen because the thief was spending less than she did. Excluding mortgages, household borrowing in the UK rose to £198 billion and with car financing increasing by 15% and credit card debt by 10% this represents the fastest growth in debt levels since 2005.  Statisticians suggest the average household could last just 32 days without any income and that more than 22% have savings below £500.

This depressing picture is indicative of how austerity has impacted on the general public. However, it does not reflect the true picture because the reports on personal debt do not include “Hidden” liabilities such as personal guarantees for third party borrowing or directors over-drawing on their loan accounts.  The worst case I have seen so far was a former partner of a failed legal practice whose Christmas present in 2014 were demands amounting to £11 million.  Try explaining that to your spouse!

At PBC we see people with personal debts ranging from less than £10,000 up to the poor sole mentioned above. Regardless of the quantum of debt they all endure the same; demand letters, High Court Enforcement Officers, threats of bankruptcy etc.  Admittedly, there are some who consult PBC where bankruptcy is the best option for that individual due to the overall circumstances.  Others, like our client with the unwanted Christmas present, entering into an individual voluntary arrangement (“IVA”) provided certainty and protected his career.

As implied, an IVA is not right for everyone. It is a deal with your creditors; a balanced compromise where there are benefits for both the client and their creditors and demonstrates being more beneficial than bankruptcy.  The key component from the client perspective is you must have something to offer, whether that is an income contribution or tangible offers, or a combination of both.

The principle message has (and will always be) take advice early. The longer you leave debt-related problems the more antagonised your creditors will become, the more cumbersome the debt and the less creditors will be persuaded to support any form of compromise you may wish to put forward.

PBC continue to support business

What is your most valuable business asset? I hope most readers will respond along the lines of,

“Our employees, of course.”

Last year the directors of PBC Business Recovery & Insolvency were delighted to support the Northamptonshire SME Business Awards. In fact, we were so pleased with it that we agreed to support the awards for 2017.  So, what does that have to do with the opening question?  Well, if you acknowledge your staff are your most valuable asset what are you doing to enhance the skill and efficiency of that asset?

The training and development of your staff can be one of the most astute investments a business can make. The more they learn, the more efficient they become and the more efficient they become the more competitive you will be in your field of trade.  Certainly, that has been our experience at PBC where I am not shy in claiming we have a team that is envied by our competition.  Meeting their training needs has brought success and, in turn, the staff have developed into a team that means they support one another in the challenges faced, with the result being PBC meet the expectations of advisors who refer clients to them.

So, why not demonstrate to the business world of Northamptonshire that you also push the training and development of your team.  Enter the 2017 awards and get the promotion you deserve.  You can read about the awards and obtain your application on http://www.northamptonshireawards.co.uk/.