Insolvency Practitioner Quiz

<p>ERIP creates a framework for the coordination of insolvency proceedings across different European Union countries. (C)</p> Signup and view all the answers

<p>The directors have already been disqualified by a court order. (A)</p> Signup and view all the answers

<p>To allow companies facing financial difficulties to restructure and avoid bankruptcy. (D)</p> Signup and view all the answers

<p>Continuing to trade a company after it has become inevitable that it will be liquidated. (A)</p> Signup and view all the answers

<p>The fate of employees is determined by the type of insolvency procedure used for the company. (A)</p> Signup and view all the answers

<p>An individual who acts as a director but is not formally appointed and registered. (D)</p> Signup and view all the answers

<p>To decide which insolvency practitioner will handle the case. (B)</p> Signup and view all the answers

<p>A compulsory liquidation is initiated by the creditors, while a CVL is initiated by the shareholders. (C)</p> Signup and view all the answers

<p>An outdated method for individuals to reach an agreement with creditors outside of bankruptcy. (A)</p> Signup and view all the answers

<p>The debtor must have significant assets, exceeding £300. (B)</p> Signup and view all the answers

<p>The process of converting a floating charge into a fixed charge. (B)</p> Signup and view all the answers

<p>The inability to hold any management position in a company for a period. (B)</p> Signup and view all the answers

<p>A CVA involves restructuring debts, while a CVL involves the complete dissolution of the company. (B)</p> Signup and view all the answers

<p>A person who, despite not being a director, exerts influence over the management of a company. (C)</p> Signup and view all the answers

<p>A formal agreement between a company and its creditors to restructure debts or make other financial arrangements. (D)</p> Signup and view all the answers

<p>To initiate legal action against a company that has failed to pay its debts, potentially leading to bankruptcy. (C)</p> Signup and view all the answers

<p>To manage the assets of a debtor in insolvency proceedings, distributing them to creditors. (A)</p> Signup and view all the answers

<p>A legal right granted to a creditor to take possession of a debtor's assets in the event of non-payment. (A)</p> Signup and view all the answers

<p>They provide legal protection to employees of a company that is undergoing insolvency proceedings. (A)</p> Signup and view all the answers

<p>A legal agreement whereby a debtor transfers their assets to a trustee for distribution among creditors. (C)</p> Signup and view all the answers

<p>A legal strategy for a supplier to retain ownership of goods until they are paid for. (A)</p> Signup and view all the answers

<p>To distribute assets to creditors and shareholders (C)</p> Signup and view all the answers

<p>Center of Main Interests (B)</p> Signup and view all the answers

<p>The company can pay its debts in full with interest (C)</p> Signup and view all the answers

<p>To act on behalf of creditors during the approval process (A)</p> Signup and view all the answers

<p>Pensions Act 1995, section 75 (C)</p> Signup and view all the answers

<p>Any ordinary creditor without security. (D)</p> Signup and view all the answers

<p>To avoid insolvency through negotiated debt payments. (D)</p> Signup and view all the answers

<p>A court order for a company to enter compulsory liquidation. (D)</p> Signup and view all the answers

<p>Continuing to trade after it becomes clear that insolvency is imminent. (A)</p> Signup and view all the answers

<p>Insolvency Act 2000 (A)</p> Signup and view all the answers

<p>To assist with liquidation and insolvency matters. (D)</p> Signup and view all the answers

<p>The partnership assets of an insolvent partnership. (B)</p> Signup and view all the answers

<p>Protection from creditor remedies while a voluntary arrangement is being arranged. (B)</p> Signup and view all the answers

<p>A CVA aims to restructure the company and keep it operating, while a pre-pack involves selling assets and leaving liabilities behind. (D)</p> Signup and view all the answers

<p>Pre-packs are typically faster and less complex, allowing for a swift resolution to the company's financial troubles. (D)</p> Signup and view all the answers

<p>The administrators, the company's management, and potential buyers (B)</p> Signup and view all the answers

<p>Pre-packs are often favoured in situations where a quick resolution is needed, while CVAs might be more suitable for long-term restructuring. (A)</p> Signup and view all the answers

<p>They represent the company's commitment to working towards a successful restructuring. (A)</p> Signup and view all the answers

<p>Unsecured creditors may see a CVA as an opportunity to maintain a business relationship with the distressed company. (B), CVAs provide unsecured creditors with a chance to gain a portion of future revenues, while a pre-pack typically results in no further returns. (C)</p> Signup and view all the answers

A legal agreement for a partnership to resolve financial troubles with creditor support.

Once approved, a PVA binds all creditors regardless of their involvement.

A pre-pack is a sale of a company's assets agreed before insolvency.

To preserve value for the business, creditors, and shareholders.

A CVA keeps the business intact, a Pre-Pack transfers ownership while leaving liabilities behind.

CVAs are public processes with all creditors engaged, leading to increased involvement.

Owner-managed businesses often choose CVAs to restructure and survive financial issues.

Unsecured creditors may support a CVA for better future revenue and relationships with suppliers.

A proposal by directors for partial or full payment of debts.

Liquidation ordered by courts due to unpaid creditor petitions.

A person or entity owed money.

A meeting for creditors to appoint insolvency practitioners or consider proposals.

An insolvency solution for individuals with low liabilities and minimal income.

Release from liability granted to a bankrupt after a bankruptcy order.

Removal of a director's right to manage a company for misconduct.

Winding-up of an insolvent company by shareholder resolution.

A legal mechanism allowing suppliers to retain ownership of goods until payment is received.

A compromise or arrangement between a company and its creditors under the Companies Act 2006.

A creditor with security over the debtor’s assets, prioritized in payments.

A charge or mortgage on assets to secure repayment of a debt.

Personal bankruptcy term used in Scotland under the Bankruptcy (Scotland) Act 1985.

An individual who gives directions to a company’s directors without being an official director.

A formal notice demanding payment of a debt within 21 days, leading to potential bankruptcy.

Laws ensuring employee contracts transfer automatically during a business sale.

Process that ends a company’s existence by distributing assets to creditors/shareholders.

An official receiver or licensed IP assigned to wind up a company's affairs.

A shareholder or subscriber of a company undergoing insolvency.

A suspension of creditors' legal rights against a company or individual.

Breach of duty regarding a company's funds or property by its directors or managers.

An insolvency procedure where creditors agree to terms with a debtor.

A company-initiated liquidation, not imposed by a court.

A court order to place a company into compulsory liquidation.

Insufficient assets to meet debts or unable to pay debts on time.

A licensed individual authorized to handle insolvency matters.

A protection court order for a debtor during a voluntary arrangement process.

Recognition of a debt or a court decision after trial.

An IP acts on behalf of creditors in insolvency matters.

IP is compensated from the assets of the insolvent company or individual.

Employee fate depends on the insolvency procedure used.

Employees of a closing insolvent company may be entitled to redundancy payments.

The IP reports director conduct for potential disqualification, unless it's a voluntary arrangement.

Continuing to trade when liquidation is inevitable, causing losses to creditors.

European Regulation coordinates insolvency proceedings across EU countries.

A preventative restructuring option for solvent companies in France.