An licensed insolvency practitioner (IP) is licensed to help companies in financial distress and administer formal insolvency processes like liquidations, company voluntary arrangements, administration and receiverships. They are often appointed by creditors, the courts or the directors of a distressed company. They are also able to offer advice on insolvency matters before formal insolvency proceedings start and can help you save your business in a time of crisis.

Insolvency practitioners must have a licence to practice which is issued, on an annual basis, by their regulator – known in the industry as a Recognised Professional Body. This ensures that they are complying with their statutory duties and delivering the high standards expected of them. This is achieved through regular inspections of their practices and a requirement that they file reports with the RPB. In the case of severe compliance issues, such as poor quality work and systems, or if the insolvency practitioner is deemed to be acting against their statutory duties, they can face sanctions which may lead to their licence being withdrawn.

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Whether an IP is employed to rescue your company in a CVA or act as liquidator of a solvent business, they will provide a comprehensive report on the results of their investigations and actions. They will also charge a fee for their work which can be either fixed or capped based on the type of insolvency procedure undertaken. The fee can be deferred for the duration of a CVA or drawn from asset realisations if the company is being liquidated.