AB Debt Advisor | Business consultant

AB Debt Advisor

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20.01.2022 Debtors Failing to Pay No matter how strong and healthy your business is, your debtors may not be. Say your business is owed $50,000 from a debtor. The debtor’s account has been recently started going into arrears and is now outside normal trading terms without permission.... You take the typical approach place the account on some form of stop, issue legal proceedings to recover the moneys. This results in you recovering $30,000. The remaining $20,000 is unpaid, but undertakings have been made to repay it. 3 months later the debtor enters into liquidation /bankruptcy. Because you have reacted to the growing debt of the debtor you have now acknowledged you believe the debtor had at least, potential insolvency issue. The Liquidator/Trustee reviews the financial transactions of the debtor, identifies that you have received $30,000, and requests repayment of that amount to him as a preferential payment. This is easier said than done, as it is quite likely, you will have spent that $30,000 and it wont be sitting in the bank. All of a sudden, you are faced with paying back money you don’t have, and the debtor still owes the outstanding $20,000, plus the $30,000 you now have to return. This is where strategic management of your debtors is important, and the big stick approach is not necessarily the best method. Talk to us to help improve your debtor collections.

14.01.2022 We are a boutique insolvency firm specialising in bankruptcy and liquidation. We pride ourselves on our passion of helping people in financial distress, our integrity in doing what we say, and achieving the best possible outcome for all parties. Bankruptcy, Liquidation, Insolvency are not dirty words.they could be your saviour. We are most suited to individuals, small to medium sized businesses, and work with the client to achieve the best solution to their problems. Fina...ncial stress has a debilitating influence on a person's ability to perform at their best. During periods of stress, most people turn into ostriches and bury their head in the sand, however in truth, talking to an insolvency practitioner may be the best decision you ever made. Knowing your bottom line allows the persons to properly assess their future actions and the impact on them, the creditors, the law, and most importantly, allows an opportunity to assess turnaround options/capacity. See more

08.01.2022 COVID Government Stimulus - Landlords/Tenants The Government introduced legislation restricting landlords from taking recovery action against tenants, and similar style legislations stopping Banks from evicting defaulting property owners. This restriction was set for 6 months and is due to expire in late September 2020. There is no indication this legislation will be extended, and it is questionable whether it is actually viable to extend. Whilst it is relatively easy for the... Banks to simply add on 6 months to the mortgage term (remembering interest on the debt wasn’t stopped during this period), landlords will face a far different prospect of recovering moneys unpaid during the 6 month period. Landlords will have to negotiate with the Bank to extend the mortgage and also negotiate with the tenant on recovering the arrears. Given rent is often one of the more expensive business costs, having to pay the normal monthly rent and a portion of the arrears will require a significant restructure of the business finances. This will have to be done under the ‘new normal’ of COVID/post COVID business revenue. It is important to note that simply using a Landlord’s position of power to demand ‘payment or eviction’ may not achieve the best financial income. This is where a skilled Insolvency Practitioner may be able to assist in helping restructure the business model of the landlord and the tenant.

04.01.2022 COVID Impacts on Supplies COVID is impacting the economy, much is obvious closed borders, Victoria in lockdown, AFL and other sporting events being thrown into disarray. The financial impact is obvious, we have just had our first recession since WW2. But looking a little wider, COVID is a worldwide influencer on economies. China as a major manufacturer has reduced production, and Melbourne is probably considered to be Australia’s manufacturing capital. The lockdown in Vict...oria means that local production has stopped overnight, and China is releasing much lower quantities than before. Consequently, retailers and add-on manufacturers are only able to gain access to stock already in warehouses, and eventually those supplies will run dry (if they haven’t already). Obviously, this condition will impact businesses in different ways. This condition is not something that can be readily addressed by Government stimulus if you cant leave your house, you cant work. What measures are you taking to prepare/protect your business from this scenario. Have you discussed with your suppliers and debtors how COVID is impacting on them if not why not?