Choosing the right insolvency practitioner for your UK business is very important. You may be looking for someone to help you close your business or to get help turning it around with the aim of restoring profitability. Either way these are specialist skills, which is why you need a dedicated professional.

The choice you make now could affect the desired outcome for your company. It could also have a big bearing on those who work for you. Furthermore, it will be the key factor in determining how the process goes for you. This can be a very stressful time and having a professional on hand to guide you through the process can make it so much easier for you and your staff.

What do insolvency practitioners do?

First, however, it is a good idea to look at exactly what insolvency practitioners do. Once you understand their role you can get a clearer picture of the skillset they require to help you.

The role of an insolvency practitioner can be varied and is not defined in any one way. However, everything they do involves working with insolvent companies. This could be overseeing a restructuring of the business in order to make it profitable. Or it could be helping to close the business down in the least damaging way possible, ensuring that creditors get paid back or at least negotiating agreements with them to help give you some space.

Ultimately, their main aim is to do whatever it takes to achieve the best possible outcome for the business in question.

How to find an insolvency practitioner

Before you make your choice, you need to find at least one insolvency practitioner. You can do this in several ways. Firstly, you can ask people who may have been in similar situations if they know of anyone. A personal recommendation is always useful, especially when it comes to financial matters.

If this search comes up blank, then you can simply do a quick Google search to see what you can find online in your local area. This should bring up a number of names and then the process of choosing can begin.

How to choose

There are several key factors that you need to keep in mind when making your choice. The first has to do with being licensed. In the UK, insolvency practitioners must be licensed to practise. They should be members of the required professional bodies who oversee the industry. In the UK and Ireland these are:

• Insolvency Practitioners Association
• Institute of Chartered Accountants of England and Wales
• Institute of Chartered Accountants in Scotland
• Institute of Chartered Accountants in Ireland

It is very important that whoever you choose has the relevant licence from the above bodies. Only then will they be able to carry out many of the main jobs associated with insolvency such as liquidation, administration or setting up a Company Voluntary Arrangement.

The next key thing to look for is experience. While all licensed insolvency practitioners are required to meet a certain standard in order to be part of the professional body, they are not all equally experienced or skilled. You should select a few practitioners and then arrange to meet them to get a better idea of the experience they can bring to the table.

An experienced IP will ask you lots of relevant questions about your business in order to establish your current situation and what might be involved in their work. You should also ask them about their relevant experience and find out if they have worked in similar circumstances before.

If you do not think they have the right experience for you, then think very carefully about whether to take on their services. Remember that this is a very big decision for your business.

You should also ask them about contacts. These can be very useful and can help to speed the whole process up. As time will be costing you money, the quicker you can get the situation resolved the better. If they know people who are going to prove useful in the process, then this can be very handy.

As this is going to be a difficult and stressful time, you also need to find someone who you can work with in close quarters. You will need to build up trust and develop a good working relationship as quickly as you can.

Of course, there is one major consideration that we have not yet discussed: the cost. Insolvency practitioners are there to help you resolve difficult financial situations but they are not free. You need to get an estimation or quote for their services. Some will give you a free consultation. Others will be on the clock the whole time.

Remember that the cheapest option is not always the best option and that going for a more expensive option might save you money in the long run. If they are able to reorder your business and make it profitable again then they will be well worth their fee. Or if they are able to buy some time with your creditors or negotiate a better settlement then this also makes it a great value deal.

Use the information that you have available to make your choice. Look at reviews online from trusted sources as these will tell you most of what you need to know. Ask for references if possible and make sure you do your research – don’t just go for the first one you find.

So, as you can see, there is a lot to think about when choosing an insolvency practitioner. But, as it is such an important decision, it is well worth going through all of the above before you make your choice.

If you would like more information about how to choose an insolvency practitioner, get in touch with a member of our team. We will be happy to give advice as and when we can and we’re always happy to help. Call Leading Business Services on 01603 552028.