Opting for a company voluntary arrangement
In case one is taking into consideration a company voluntary arrangement, there is a higher chance of success if action is taken early, just as the case is with most business rescue programs. If one feels that the business is facing financial trouble, it is advisable to seek expert advice sooner rather than waiting until a petition for winding up appears.
If a business is facing serious financial pressure but it can remain viable in case the debt is removed, then a Company Voluntary Arrangement (CVA) can be the appropriate solution.
A company voluntary arrangement is a mechanism which allows a business entity to propose a resolution to its creditors. The business then pays back a certain percentage of the debt over a fixed time frame, usually of three to five years. If the creditors agree, they in effect accept to receive reduced installments in full payment of the debt.
