Biddles Legal

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Insolvency and Bankruptcy Solutions

Insolvency matters take different forms and are most often always urgent. Ignoring the signs of insolvency and doing nothing is never the right solution and can only aggravate the financial distress. Whether you are having issues with a supplier, a customer, or the Australian Tax Office (ATO), the best course of action is to take expert legal advice as early as possible.

This is where Biddles Legal comes in. Our commercial insolvency team will collaborate closely with you to give advice on all aspects of administration, insolvency, and bankruptcy.

What Is Insolvency?

Insolvency is a legal term that refers to the inability to meet financial obligations—such as bills and debts—as and when they become due. There are many varied factors that cause corporate insolvency, including cash flow mismanagement, bad refinancing decisions, and legal problems.

If you are a director of a company and you allow your business to continue to operate while it is insolvent, you may be held personally liable for the unpaid debts your company incurs during this period. This can then quickly snowball into bankruptcy.

Financial Red Flags

There are red flags that indicate your business is in financial trouble. Here are the most common signs:

  • Persistent cash flow problems, including poor or negative cash flow and increasing debt
  • Problems with the ATO, such as overdue taxes, fines, and superannuation liabilities
  • Legal issues like solicitors’ letters, summonses, and judgements issued against you or your company
  • Management issues that disrupt normal company operations like board disputes and director resignations
  • Financing setbacks, defaulting on loans, or reaching overdraft limits, including failure to secure additional financing