Nxt Manchester — Jan./Feb. 2009 - (Page 20)

We are currently responding to a significant increase in calls for advice from businesses in trouble. PROFILE Paul Stanley Partner Begbies Traynor Businesses involved in insolvent trading are storing up serious personal financial trouble, warned Manchester’s Paul Stanley, a partner at Begbies Traynor. Personal stakes are high for directors— as they may be found personally liable. He said if they need help, they should contact qualified advice as soon as possible. “We are currently responding to a significant increase in calls for advice from businesses in trouble,” said Paul. “When we meet the directors of these companies, it transpires that, not only are the companies usually insolvent but they have been for some time. They may not be aware of insolvency legislation. Therefore, they have been putting their personal financial situations at risk without knowing.” Paul said his company has to explain that, under the insolvency legislation, a company is defined as being insolvent either when its assets are less than its liabilities or if the company can’t pay its debts when they are due. “If you are up against your overdraft limit and payments to creditors are overdue then the company is insolvent,” said Paul. He said the insolvent umbrella also covers the idea of sitting on a property that has significant equity if it cannot be realised to raise funds. “The problem for directors comes if they continue to trade after they know the company is insolvent,” said Paul. “In such a case, if the position of creditors gets worse and they end up by getting a smaller dividend than if ‘‘ Personal Liability Shock in Store for Insolvent Directors ‘‘

Table of Contents Feed for the Digital Edition of Nxt Manchester — Jan./Feb. 2009

Cover Contents Editor's Notes Nxt Challenge MediaCityUK 2009 - The Vision The Lowry Hotel Nxtbook Stateside Nxtbook Europe Colin's Spinning Jenny Puts Manchester on the New Media Map Personal Liability Shock in Store for Insolvent Directors Key Tips to Generate Web Site Revenue Economy: Business Rescue Taxman Drives a Hard Bargain on Travel Expenses Server-Hosting Sector Goes Green Don't Let the Credit Crunch Affect Your Health The Changing Face of Manchester Salford University Appoints MediaCity Director Century Turns Real Nxt News Events

Nxt Manchester — Jan./Feb. 2009

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