Voidable Mitigation
Litigation can be an expensive and time-consuming exercise and today’s enterprise is looking for more than just assistance at the time an issue arises. SV Voidables can help you take proactive steps to mitigate your or your client’s risk of being pursued by Liquidators or Bankruptcy Trustees for voidable transactions.
Adopting a proactive approach requires starting well before a debtor becomes insolvent. It requires forensic due diligence of internal controls and documented trading terms and conditions, with the aim of applying consistent recovery strategies across all trade debtors. How to prevent litigation? Key indicators that Liquidators and Bankruptcy Trustees look at when deciding to pursue a creditor for voidable transactions are, as a non-exhaustive list:
- Excessive pressure by debtor collection teams within companies
- Statutory demands and other informal demands
- Long outstanding debts
- Round payments
- Dishonoured payments or post-dated cheques
A workable summary of s 91 of the ILRA
Problem | Solution |
|---|---|
We compare those terms to a Matrix analysis, which scores the terms relative to a cross-section of other terms and conditions in the market. That score can be provided to your lawyer to assist in drafting updated terms. | |
The Personal Property Securities Register (PPSR) | We undertake an audit of a sample of trade debtors to assess the effectiveness of the PPSR registrations. |
Internal controls over trade debtor recoveries | We perform a review of:
These are all issues that can leave you or your client open to recovery action being taken by Liquidators or bankruptcy Trustees. We can further assist by training employees to handle correspondence with debtors, so that they stay within the bounds of the good faith defence. |
How can SV Partners help?
At SV Partners, we provide our clients with an objective and defensible opinion of the value of the entity in question. Our valuations combine expertise with leading valuation and corporate finance knowledge. Please contact a member of our forensic accounting team on 1800 246 801 if you would like more information on how we can assist you with Valuation services.