This case study demonstrates how a Company Voluntary Arrangement can give businesses the opportunity to survive. If the CVA is dealt with properly, despite the initial fears, creditors will work with the company and its directors if there is a sensible plan and Company Voluntary Arrangement experts are called in at an early stage.
In this instance, the company had became untenable in its current state and something needed to happen to resolve paying HMRC, as HMRC were not prepared to allow the tax problems to continue and some of the supplier accounts had been placed on stop.
Unusually, this CVA was able to provide a full return to creditors of 100p in the £ within five years, without any debt being written off, compared to an estimate of 4p in the £ on voluntary insolvency.
Read the full article on our sister site, Cashsolv.