The appointment of a liquidator will have significant effects on the company. The effects will include the following:
- The company’s directors and employees will not be able to make any decisions on behalf of the company. The appointed liquidator is the only person who can make decisions on behalf of the company;
- In most situations, the company will cease normal trading activities immediately unless the company can be sold as a going concern (ie the business has some commercial value as a going concern);
- If the liquidator makes the decision to cease trading activities immediately, then the liquidator would normally:
a. Freeze the company’s bank account;
b. Terminate the employees; and then
c. Identify and secure the company’s assets. Once the liquidator has confirmed that the assets are owned by the company (and not under finance), then the liquidator will make arrangements for them to be valued and then sold.
- Any legal proceedings against the company will be automatically stayed without leave of the court.
If you would like to understand the effect of liquidation on the company, please call Australian Company Liquidators on 1800 731 155.
The information provided in this site is general in nature and should not be relied upon for your specific circumstance. Call us on 1800 731 155 for a free initial consultation to discuss your specific issues.