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Apollo Shoes Case Study

Crystal Alvarez
Crystal Alvarez
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Apollo Shoes Case Study
Anderson, Olds and Watershed
Certified Public Accountants
Letter to the Audit Committee
To: Apollo Shoes Audit Committee
From:
Date:
Subject: The Audit of....
The following memo aims to outline the results of the audit of Apollo Shoes, give recommendations
to improve the company's operations, and provide justification for our qualified opinion.
For their accounts receivable confirmation as of December 31, 2017, Mall–Warts stated that they
had entered into involuntary bankruptcy on November 3, 2017. After having adjusted their balance
due for shoes that were wrongly shipped to them in the amount of $5,765,081.85, Mall–Wart had a
balance due of $14,784,144.03. Due to the unlikeliness that this amount is to be collected, we have
proposed that this amount be written off in full to bad debt expense. However, Larry Lancaster has
decided not to record this entry in hopes that Apollo Shoes will still be able to pay the amount in
full. When ignoring the adjustment for the wrongful sales, in which Larry believes Mall–Wart will
pay, Mall–Wart accounts for 40% of the company receivables. The fact that Mall–Wart has declared
bankruptcy is too material to ignore, and we are unable to give an unqualified opinion. We disagree
with Larry's analysis of the situation, and therefore have given the 2016 financial statements a
qualified opinion.
There are a few other matters, unrelated to the qualified opinion, that we believe should be made
aware to the audit committee. They are as
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Apollo Shoes Case Study
Questions And Concerns Regarding Your Football Club Facing...
Dear Mr James,
Further to your questions and concerns about your football club facing problems currently. This is a
common practice in the UK that football clubs face financial problems due to their debts exceeds
from their assets. In recent years many football clubs went into administration. This situation arises
where football clubs unable to pay their debts. Therefore, they went insolvent or in to liquidation.
The company shareholders passed the special resolution to put the company in to bankruptcy or
liquidation. All process done under the Insolvency Act 1986 , the Bankruptcy and Diligence etc.
(Scotland) Act 2007 and Debt Arrangement Scheme (Scotland) regulations 2011. I start with your
concerns about the arrestment of your corporeal and incorporeal moveable assets (Possessed by you
or in the hands of a third party) by the creditors which you fear they might arrest due to the debts
that your club unable to pay. Arrestment procedure set out in s 73A of the Debtors (Scotland) Act
1987( the " 1987 Act") this section provided that an arrestment in execution must follow a decree in
respect of the debt due to the creditor and a schedule of arrestment must be served upon the debtor
together with debt advice and information. Section 73E of the 1987 Act provides that the arrestment
attaches the lesser of (i) the sum due by the arrestee to the debtor or (ii) the sum due by the debtor to
the arrester, plus expenses, and interest. It is not possible for the creditor to arrest
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Apollo Shoes Case Study
The Problem Of Football Club
Further to your questions and advice you require about your football club facing currently. This is a
common practice in the United Kingdom that football clubs face financial problems due to their
debts exceeding their current assets. In recent years, many football clubs went into liquidation,
administration process. This situation arises where football clubs are unable to pay their debts
because they could not control their massive expenditures. Therefore, they went insolvent or in to
liquidation. To sum up this process, the company shareholders passed the special resolution to put
the company in to liquidation or administration or Creditors take the matter to court and get the
court orders against potential debtors. All processes are done under the common law and statutes
such as Insolvency Act 1986 , the Bankruptcy and Diligence etc. (Scotland) Act 2007 and the Debt
Arrangement Scheme (Scotland) regulations 2011 and the Company Act 2006. The creditors may
arrest your company assets through the process of diligence.
I start with your concerns about the arrestment of your company assets in the hands of a third party
(bank accounts, tickets, outlets etc.) by the creditors which you fear they might arrest due to the
debts that your club is unable to pay. Arrestment procedure set out in s 73A of the Debtors
(Scotland) Act 1987 (the "1987 Act") this section provides that an arrestment in execution must
follow a decree in respect of the debts due to the creditor and a
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Apollo Shoes Case Study
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Apollo Shoes Case Study

  • 1. Apollo Shoes Case Study Anderson, Olds and Watershed Certified Public Accountants Letter to the Audit Committee To: Apollo Shoes Audit Committee From: Date: Subject: The Audit of.... The following memo aims to outline the results of the audit of Apollo Shoes, give recommendations to improve the company's operations, and provide justification for our qualified opinion. For their accounts receivable confirmation as of December 31, 2017, Mall–Warts stated that they had entered into involuntary bankruptcy on November 3, 2017. After having adjusted their balance due for shoes that were wrongly shipped to them in the amount of $5,765,081.85, Mall–Wart had a balance due of $14,784,144.03. Due to the unlikeliness that this amount is to be collected, we have proposed that this amount be written off in full to bad debt expense. However, Larry Lancaster has decided not to record this entry in hopes that Apollo Shoes will still be able to pay the amount in full. When ignoring the adjustment for the wrongful sales, in which Larry believes Mall–Wart will pay, Mall–Wart accounts for 40% of the company receivables. The fact that Mall–Wart has declared bankruptcy is too material to ignore, and we are unable to give an unqualified opinion. We disagree with Larry's analysis of the situation, and therefore have given the 2016 financial statements a qualified opinion. There are a few other matters, unrelated to the qualified opinion, that we believe should be made aware to the audit committee. They are as ... Get more on HelpWriting.net ...
  • 3. Questions And Concerns Regarding Your Football Club Facing... Dear Mr James, Further to your questions and concerns about your football club facing problems currently. This is a common practice in the UK that football clubs face financial problems due to their debts exceeds from their assets. In recent years many football clubs went into administration. This situation arises where football clubs unable to pay their debts. Therefore, they went insolvent or in to liquidation. The company shareholders passed the special resolution to put the company in to bankruptcy or liquidation. All process done under the Insolvency Act 1986 , the Bankruptcy and Diligence etc. (Scotland) Act 2007 and Debt Arrangement Scheme (Scotland) regulations 2011. I start with your concerns about the arrestment of your corporeal and incorporeal moveable assets (Possessed by you or in the hands of a third party) by the creditors which you fear they might arrest due to the debts that your club unable to pay. Arrestment procedure set out in s 73A of the Debtors (Scotland) Act 1987( the " 1987 Act") this section provided that an arrestment in execution must follow a decree in respect of the debt due to the creditor and a schedule of arrestment must be served upon the debtor together with debt advice and information. Section 73E of the 1987 Act provides that the arrestment attaches the lesser of (i) the sum due by the arrestee to the debtor or (ii) the sum due by the debtor to the arrester, plus expenses, and interest. It is not possible for the creditor to arrest ... Get more on HelpWriting.net ...
  • 5. The Problem Of Football Club Further to your questions and advice you require about your football club facing currently. This is a common practice in the United Kingdom that football clubs face financial problems due to their debts exceeding their current assets. In recent years, many football clubs went into liquidation, administration process. This situation arises where football clubs are unable to pay their debts because they could not control their massive expenditures. Therefore, they went insolvent or in to liquidation. To sum up this process, the company shareholders passed the special resolution to put the company in to liquidation or administration or Creditors take the matter to court and get the court orders against potential debtors. All processes are done under the common law and statutes such as Insolvency Act 1986 , the Bankruptcy and Diligence etc. (Scotland) Act 2007 and the Debt Arrangement Scheme (Scotland) regulations 2011 and the Company Act 2006. The creditors may arrest your company assets through the process of diligence. I start with your concerns about the arrestment of your company assets in the hands of a third party (bank accounts, tickets, outlets etc.) by the creditors which you fear they might arrest due to the debts that your club is unable to pay. Arrestment procedure set out in s 73A of the Debtors (Scotland) Act 1987 (the "1987 Act") this section provides that an arrestment in execution must follow a decree in respect of the debts due to the creditor and a ... Get more on HelpWriting.net ...
  • 7. The Insolvency Of Human Nature And The Nomological Notion The Insolvency of Human Nature and the Nomological Notion: A Refutation of Machery As one examines Edouard Machery's "A Plea for Human Nature," it is clear that there are a number of critical themes to examine within the nomological context set forth (Machery 2008). In a very salient sense, Machery posits that the set of characteristics that humans are most often inclined to posses, are indeed representative of human nature and are a consequence of the species' evolution (Machery, pp. 3, ll. 56–58). Moreover, Machery puts forth that the existence of human nature does not circumscribe a tie within the human species (Machery, pp. 3–4, ll. 85–90). Herein, Machery also notes a class formation within a biological context that includes ... Show more content on Helpwriting.net ... Yet in the case of the former, one can reason that what is deemed common sense, could easily vary across time and place, so as to make such judgments more akin to conjecture rather than fact. In the case of the latter, while apt modern sciences may in some regard be able to depict what anguish is from a physiological standpoint, quantifying the degree of physiological change and its resultant effects would be extremely variable and call in to question the arbitrary title of "anguish." Indeed, empirical physiological results and common sense conjectures would likely fall on an enormous spectrum. For example, empirical data might detail some mean regarding hormonal levels, while themes regarding perception might feature general sensibilities formed by individuals and groups. To be sure, one would likely find a host of other factors in which one could confirm their own bias about the nature of anguish. Herein, such broad ranges of results would have not characterized anguish, human nature, or what people tend to posses, but rather merely that humans have fairly rudimentary and vacillating senses. Moreover, there is not much of a sense of what is at stake, as generalizations about given groups could be deemed as their given "nature," only to change across ... Get more on HelpWriting.net ...
  • 9. Finance, Cash Flow and Insolvency Report Finance, Cash Flow and Insolvency Report Background Information on Owensport Owensport a sole trader intends to setup a business manufacturing a new style of multi–gym in the Reading area. Here are the following fixed assets that he will require to run his business: * Premises * Machinery * Equipment (Office) * Vehicle Working capital * Labour * Spare Parts * Telephone * Stock * Lighting/heating/electric How to pay for the assets For Owensport to purchase his fix assets he should looking init two terms of finance, medium term finance is any thing from borrow money from 1–5 years. The last term of finance is a long–term finance which ... Show more content on Helpwriting.net ... Using hire purchase also means that you are not laying out such a large sum initially, compared with
  • 10. the buying out right, which can be helpful with cash flow. However the payment you make will consist of capital, as well as interest parts of payments. Hire Purchase, involves the whole capital value of the vehicle (VAT included) being paid off plus interest over the chosen terms of the contract. It therefore delivers a fixed amount of equal and unchanging payments and then Owensport will own the vehicle. Hire Purchase gives some cash flow advantages over outright purchase, but not to the extent of contract hire, lease purchase. Advantages * Fixed term and fixed equal, unchanging payments * Assets is owned by user at the end of the contract * Cash flow advantage over Outright purchase * Taxation advantage on high value vehicles over Contract Hire and Lease Purchase. Disadvantages * Once you have entered into this agreement it is hard to escape the payments if you no longer require the asset. * High deposits are generally used. * This is classed as a debt on your balance sheet, which could make it difficult for future borrowing. * Can be more expensive due to VAT changes. * Deprecation charges are yours. Leasing If a company leases am equipment they, are not the owner of it although the company be able to buy ... Get more on HelpWriting.net ...
  • 12. Procedures For Support The Assessment Of Units And The... 16. ASSEMENT 16.1. Have the staff, resources and systems necessary to support the assessment of units and the award, accumulation and transfer of credits and, where necessary, the recording of exemptions. 16.2 Have arrangements in place that allow for recognition of prior learning (RPL) (where appropriate). 17.0 TERM AND TERMINATION 17.1 A Centre approval license granted under this agreement shall, subject to earlier termination in accordance with this agreement, continue for a minimum period of three years from the date upon which it is granted and shall continue thereafter until termination by either party giving to the other not less than six month notice in writing, such notice to expire on an anniversary of the date on which the Centre approval license was granted. 17.2 Approval of any approved course shall, subject to earlier termination in accordance with this agreement, continue for a minimum period of three years from the date upon which the approval is granted and shall continue thereafter until termination by either party giving to the other not less than six month notice in writing, such notice to expire on the anniversary of the date on which the approval was granted. 17.3 Asset™ may terminate the Centre approval license and/or the approval of any and all approval courses forthwith by notice in writing if the Centre is in breach of this agreement and shall have failed to remedy the breach (where the breach is capable of remedy)within 30 days of receipt of ... Get more on HelpWriting.net ...
  • 14. Where a company is unable to pay its debts as and when... Where a company is unable to pay its debts as and when they fall due for payment in the ordinary course of business and is deemed to have 'fallen from grace', the debtor would be technically insolvent and must apply for voluntary liquidation or a creditor may make a statutory demand for payment under Section 9 of the Insolvency Act. They are no longer in a position to handle their own estate's affairs. In the liquidation of the estate of an insolvent person, a trustee is appointed to oversee all activity of the insolvent and act on their behalf. A trustee or liquidator is appointed to investigate the debtor's financial affairs, establish the reason why the debtor is in the insolvent position, investigate possible offences, and identify ... Show more content on Helpwriting.net ... The trustee or liquidator must keep separate financial records for each bankruptcy or liquidation, and these are open to inspection by the committee of creditors. There must be sufficient residue to cover all costs of sequestration including legal fees, curator fees, and remuneration for the trustee and distribution costs . Section 74 of the Insolvency Act also allows the trustee to continue and run the debtor's business on his behalf until the debtor company is fully rehabilitated. In that instance the purpose is to sell the assets of the liquidated company either as a going concern or piecemeal, whichever would in the opinion of the trustee or liquidator be to benefit the committee of creditors. Completion of administration The actual sale of the property is done by way of public auction as provided for by Section 77 of the Insolvency Act. At the end of the liquidation, when a trustee or liquidator has released and distributed all the assets, they will arrange a final meeting of creditors. They will send notice of this meeting to all creditors they are aware of, as stipulated in Section 100(2) of the Insolvency Act. At this meeting, the trustee or liquidator will report on what they did during the bankruptcy or liquidation and will give creditors a summary of their receipts and payments. After the ... Get more on HelpWriting.net ...
  • 16. Australian Bankruptcy Law History Australian Bankruptcy Law Contents Executive Summary 2 History of Australian Bankruptcy Law 3 The Beginning 3 The English Root 3 The Adaption and the Bankruptcy Act of 1966 5 The Debate 6 The Reform 6 For the Change 6 Against the Change 6 Conclusions & Recommendations 7 Citations & References 8 Executive Summary The purpose of this report is to examine the history, and the development of the Australian Bankruptcy Law. Through reviewing historical information, the origins of the current Bankruptcy Law are explored. Furthermore, the development of Corporate Insolvency Laws in Australia from 1901 through to 2001 Corporations Act is studied. The last part of this report reviews the ongoing debate on the ... Show more content on Helpwriting.net ... By 1571, the "Statue of Elizabeth" followed, and confined the practicing of the act solely to tradesmen as well as proclaiming bankruptcy as a legal status. Furthermore, in the same year, "Fraudulent Conveyances Act" was charted which rendered transactions conducted with the intent to defraud or delay creditors, were to be void (Bathurst, 2014). In other words, transfer of fund to a trustee as such or intentional hiding the amount beyond the reach of the reach of the creditors, is considered unlawful, therefore voided. This concept was the seed to the section 121 of the Bankruptcy Act 1966. As the initial act was sought out to promote merchants and tradesmen to conduct business on British shores, nothing of the act was focussed on rehabilitating the debtor back to society. Of many punishments, losing an ear for failing to pay back a sum would have to be one of the harshest penalties, followed by imprisonment for life. It was only in 1705 when insolvent tradesmen were allowed to be discharged upon obtaining the approval from 4 out of 5 creditors. While it may seem trivial, it was the beginning of the shift towards the debtors' rehab. The bankruptcy legislations required a reform as the number of bankruptcies increased due to the increase in commercialisation and trades conducted through credits. The reforms occurred throughout the early 19th century beginning with the ... Get more on HelpWriting.net ...
  • 18. The Insolvency And Employment Law The sale or transfer of an insolvent undertaking creates an interaction between differing bodies of law. The main statutes are the insolvency and employment law, principally although not exclusively encapsulated by TUPE (TUPE, 2006). The interaction between these laws is of particular interest to this study. Insolvency legislation is focussed upon the rescue of the company and employment legislation is concerned with employee protection. The interaction between the afore mentioned legislation is inevitable, with the potential for employment protection and business rescue to be characterised by tensions. Employment law is intended to ensure protection for the employees' existing rights especially in matters relating to remuneration and can directly interfere with the attempt to transfer the struggling business with minimal financial liabilities (Thornton, 2014). There is certainly the opportunity for the divergent intentions to directly conflict during the insolvency related transfer. Pragmatically, an obvious tangible asset for cost reduction in a business rescue is often jobs. TUPE restricts the new employer's options and had been described as impinging on new owner's discretion to make financially cogent decisions (Thornton, 2014), consequently TUPE can also actually impact on entrepreneurial freedoms. Whilst recognising employee protection is necessary, if the business is unable to continue then subsequently this results in loss of all jobs. Thus from an external ... Get more on HelpWriting.net ...
  • 20. Why Bob Can Be Removed As A Director 1.0 Introduction: To begin in advising Ann, it is important to distinguish between the different options she may have as a company director and as a shareholder in Clippers Ltd. It is also important to remember that Bob is also a director and a shareholder. Therefore, there are two discreet issues here: would Ann be able to remove Bob as a Director (this option will not remove Bob as a shareholder). Alternatively, Ann may wish to petition for a winding up of the company, Clippers Ltd as the basis to firmly end Bob's involvement in Clippers. However, this option is likely to raise considerable debt issues in relation to the rights Mo will have for the return of her investment and the money owed to Dry Ltd. 2.0 Removal of Bob from ... Show more content on Helpwriting.net ... If Ann wishes to use this CA 2006 procedure, she must ensure that all of the formalities are complied with, including the need for notice to be given to all shareholders, including Bob, so that he has a right to protest his removal as director at a meeting. However, the success of this depends on whether Mo will have voting right in respect of this motion which is contingent upon her dividends being in arrears. On the basis of the facts the cumulative profits of the business would be at £70,000 which would entitle Mo to around £3,500 of dividends. As the facts suggest that Mo has only received £2,500 dividends, it seems likely Mo will be able to vote on this resolution on the basis of the articles of association. If Ann is fully determined to remove Bob from Clippers Ltd, then the only option may be to wind up the company which would bring Clippers Ltd to an end and allow Ann the freedom to commence a new company. If Ann decides she firmly wants to end Bob's involvement by winding up the company, she may be able to petition the court for a 'just and equitable' winding up of the company. Under section 122(1) (g) of the Insolvency Act 1986 (IA) a "company may be wound up by the court if the court is of the opinion that it is just and equitable that the company should be wound up". In Ebrahimi v Westbourne Galleries Ltd House of Lords confirmed this ... Get more on HelpWriting.net ...
  • 22. What Are The Advantages And Disadvantages Of Leverage... Banks typically need equity and need to make debts to fund loans and other operations. A bank's indebtedness is primarily composed by deposits, borrowings owed to other banks, and bonds released by the bank itself in the capital market. On the other hand a bank's equity is determined by subtracting the amount of a bank's liabilities from the amount of its assets; for a bank, equity largely coincides with capital. Regulation of bank capital is necessary in modern economy because without it a bank could potentially hold very modest capital and in case of losses become insolvent and unable to repay its creditors, including savers and deposit holders. Capital serves as a cushion that should allow banks to withstand even substantial losses without ... Show more content on Helpwriting.net ... The rule merely imposes a minimum proportion of assets (or a maximum proportion of debt) to equity, but those assets are not supposed to meet any specific requirements, especially in regard to their riskiness, so a bank's capital, in a system which uses the leverage ratio alone, could potentially consist solely of very high–risk assets. This can lead to a shift of the entire banking system towards riskier and riskier operations, due to the fact that, because the gearing ratio imposes an higher level of capital than that, that will be hold without regulation, and this is undesirable from the perspective of a bank, since it reduces its total amount of resources that can be invested for profit, a bank would be naturally induced to invest its remaining resources in high risk assets which usually promise an higher return of profit compared to low risk assets. Such results would be obviously counterproductive, considering that the intention of assuring a shelter from insolvency would be completely defeated in the case that the high risk assets would prove to be worth less than expected. In extreme scenarios the situation could be worse than the absence of regulation, if the existence of rules imposing leverage ratios were to induce a general sense among the public of soundness of the banking system, that may prove to be misplaced in the case that the solvency of the banks is ... Get more on HelpWriting.net ...
  • 24. A Brief Note On The American Legal System Class: Introduction to the American Legal System Student: Ais Lidzhanova Date: November 6, 2016 Research Project and Presentation Cross–Border Insolvency Legislation in the United States Many companies nowadays do not confine their activities to the territory of one state and expand their business to international markets. To do so, they inevitably enter into contracts with foreign parties or acquire property in the territory of foreign states. At the same time, business risks connected with the international transactions increase. Many companies become insolvent. The insolvency of transnational companies with cross–border relations is one of the greatest problems in economic and legal terms. First and foremost, the assets and liabilities of the insolvent company are located in many jurisdictions with their own bankruptcy laws. So, the conflict of laws is unavoidable. The company's creditors can also be found in different jurisdictions with their own regulation of creditors rights. The sensational bankruptcy of the Lehman Brothers Bank is one of the many examples of cross–border insolvency, when 75 court actions in 16 jurisdictions were filed. However, since there is no uniform international legislation of cross–border insolvency, it is important to learn the legislation of different countries. As for the United States, The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 ("BAPCPA") was enacted on October 17, 2005, and included Chapter 15. Chapter 15, ... Get more on HelpWriting.net ...
  • 26. Essay On Deepening Insolvency Originally only a theory of damages, the term 'Deepening Insolvency' refers to the wrongful prolongation of a corporation's life beyond insolvency, thereby resulting in damage to the corporation caused by increased debt, dissipation of assets, decreased reputation etc. Insolvency is generally understood, from a balance sheet perspective, as a financial condition such that the sum of the entity's debts is greater than the fair value of a company's assets. What deepening insolvency cases have also focused on, however, is cash flow insolvency–when a company incurs debt that would be beyond its ability to pay in future years–and low capital insolvency–when a company engages in a transaction or business that its capital base cannot support. When an insolvent company and its creditors are harmed by a fraudulent act or negligence of ... Show more content on Helpwriting.net ... In an article written by Sabin Willet, it was stated that "a new loan, however onerous or ill–advised, can never 'deepen' balance–sheet insolvency. Every new loan involves an infusion of capital that sets off the added debt–so the insolvency remains the same, not deeper. Shareholders are not injured by deepening insolvency; their injury is total upon the initial insolvency. The dead cannot get deader. Although a corporation's creditors may be harmed by deepening insolvency, the creditors are not the corporation; that they may suffer harm as a corporation's insolvency deepens does not mean that the corporation does. If deepening insolvency were valid, a cause of action would also have to exist for diminished solvency." Not all cases agreed to the judgment of Lafferty case. In the judgment of In re Global Serv. Group LLC , though the court recognized the loss faced by the company, it refused to see deepening insolvency as an independent cause of action in tort. The court stated – "This may be bad banking, but it isn't a ... Get more on HelpWriting.net ...
  • 28. How Does Joseph Conrad Present The Ethical Insolvency Of... Joseph Conrad's Heart of Darkness demonstrates the questionable connection between the civilized and uncivilized, colonizers and colonized. It additionally indicates how Kurtz affected the locals, and took them under his immediate control by keeping up a legitimate position.The locals with losing their awareness made Kurtz a man with a perfectpersonality. Haziness and wickedness originate from Kurtz's conduct.Through his character "Conrad depicts the ethical insolvency of colonialism by indicating European intentions and activities as no better than African Fetishism and brutality."(Brantlinger, 1999:197).Through this novel, Joseph Conrad fundamentally concentrates on the colonial demeanor towards the colonized of that era. The way they dealt ... Show more content on Helpwriting.net ... At home, they were deferential of their administrations. However, in the colonized areas they used themilitary forces and constrained the natives to work without any inquiry.This is what was happening and that is why the indigenous individuals encountered the mental impacts of "othering."European social philosophy is a sort of methodology to win the heart of locals by demonstrating their purported blessing to civilize the savage individuals. Conrad uncovered the degeneration of white men in Africa with a unique ethical vision. The fundamental point of any of "otheringdiscourse" is to affirm the colonizers' predominance over their colonized subjects.It is a procedure to construct binaries described by "Others"; these others are enthusiastic, regressive and savage while White are self, modern, sane, or disciplined. The expression "othering" shows European state of mind towards different societies and creates two different categories; one is human and prevalent and the other is sub–par and sub–human. European intellectuals deliberately or intentionally created twofold clashes by depicting "Self" and "Other" representations through their writings. The locals are portrayed as savages, wild and threatening upon the civilized world. In this way, European social belief system is a venture or a framework that influences the brain of the indigenous individuals to push them to trust themselves as subjects. Accordingly, "social colonialism" manages the issue of self–versus other and orient versus ... Get more on HelpWriting.net ...
  • 30. Chapter 11 Audit Case Study In the event that you are experiencing issues with funds and are thinking about obligation solidification or chapter 11, you may likewise be thinking about procuring a liquidation legal counselor. Obviously for the individuals who are in a money related trench or nearly monetary demolish, thinking of additional assets to pay a chapter 11 legal advisor can be out and out inconceivable. In spite of the deficiency of cash, it is regularly best to in any case consider at any rate counseling with a liquidation attorney before you start the procedure. The fundamental motivation behind a chapter 11 legal advisor is to help an individual or business experience the legitimate systems for recording liquidation. Legal counselors are intended to help manage lenders, meet with the court frameworks to set up installment arrangements or ... Show more content on Helpwriting.net ... This does not generally mean it is insightful to manage without an insolvency legal counselor, however, as most represent considerable authority in simply monetary law. Unless the court case would be effectively simple or you definitely know an awesome arrangement about the legitimate framework for this situation, a chapter 11 attorney can assistance from getting to be overpowered with the legalities of the framework. From the begin, a great insolvency legal counselor ought to help you to figure out which section of liquidation to record and will offer sound reasons why. In the event that you don't know anything about the diverse sections, this is a fantastic motivation to start counseling a legal counselor. Numerous legal advisors will even offer a free conference where you can just case the exhortation and proceed onward to deal with the rest of the case yourself. Regularly, however, legal counselors will charge by visit or by action, for example, showing up at the courthouse or recording printed ... Get more on HelpWriting.net ...
  • 32. Business Management Advantages And Disadvantages Sometimes it is inevitable that a company with a healthy business can go from stable and successful to insolvent due to a one off event. There is always a possibility for a company to face with insolvency especially when the company does not have the adequate cash flow to meet demands such as payroll and paying invoices. Hence, it is important to take steps to protect the company against it. One way a company can prevent itself from being insolvent is to carry out a 'Corporate Voluntary Arrangement' (hereinafter referred to as CVA). 2.1 What is CVA? CVA is a legally binding agreement between a company and its creditors either to delay payment or to reduce the payment of outstanding debts. Its objective is to restructure the company's debts so that it can be paid over a fixed period of time. Previously, ... Show more content on Helpwriting.net ... This is because interest and charges are generally frozen and companies are given additional time to defer repayment and to carry on its business to facilitate the recovery from the debts owed. In addition to that, the effect of moratorium in CVA is also legally binding. Once a proposed CVA is approved, no legal proceedings can be taken by the creditors against the company as long as the agreed terms are adhered to. Company directors can now be given more time to restructure and consider other options to improve their position as creditors can no longer threaten to wind up the struggling company. As for the disadvantages, it is important to note that CVA only applies to private companies and it does not extend to public company or any companies regulated under Central Bank of Malaysia or the Capital Markets and Services Act 2007 or a company with its property or undertaking charged to a secured creditor ... Get more on HelpWriting.net ...
  • 34. The United States Postal Service: At the Brink of Insolvency The United States Postal Service: At the Brink of Insolvency Business 510 – Managerial Economics Final Project Submission February 25, 2012 Executive Summary this report takes a look at the United States Postal Service financial problems, which brought it to the brink of insolvency, after losing more than $25B in the last 5 years. It analyzes factors and performance and postulates corrective actions to bring USPS back to financial solvency. Both microeconomic and macroeconomic factors affecting the firm were analyzed while identifying its strengths, weaknesses, opportunities and threats. USPS products and services demonstrate its strengths with its monopoly of the mailing industry and as a government franchise with an open ... Show more content on Helpwriting.net ... Shipping Services include but not limited to Priority Mail, Express Mail, Bulk, Parcel Post and Bulk International Mail. Mailing services have set floor prices but generally doesn't have any set ceiling price up to the allowed maximum size and weight limits (usually 70 pounds for each package). The same holds true for shipping services. All these services are offered through a network of more than 32,000 Post Offices, stations and branches, plus thousands of contract post units, Community Post Offices, Village Post Offices, retail establishments selling postage stamps and other services including the internet, www.usps.com. Additional services offered are sale of Postal Money Orders, leasing of Post Office boxes and sale of post cards or greeting cards. International mail and package services are also available to more than 190 countries (Annual Report to Congress, 2011). The current First–Class Mail stamp costs $0.45 increased 2.1% starting in January 2012 that was announced in October 18, 2011. Postal Service Mail pricing is set by the Board of Governors and approved by the PRC. Shipping services pricing is set by law covering both the institutional costs allocation and attributable costs. The institutional cost allocation is determined by the PRC and is currently set at 5.5%. Thus the shipping cost is the sum of 5.5% institutional costs (comparable to transaction costs) and attributable cost, representing the direct cost of the mailing or ... Get more on HelpWriting.net ...
  • 36. The Acquired Rights Directive 77 / 187 / Eec With further refinement in Giuseppe d 'Urso, Adriana Ventadori and others v Ercole Marelli Elettromeccanica Generale SpA and others, [1992] C–362/89, IRLR 136 ECJ and Spano and Others v Fiat Geotech and Fiat Hitachi, [1996] C–472/93, IDS Brief 558, EJC. These two cases clarified that the sale of an insolvent business as a going concern is within the scope of the Acquired Rights Directive 77/187/EEC. It is interesting to note the House of Lords in the select Committee Report on the Amended Directive, 1996 affirmed this approach (Hardy, 1996). Although the case of d'Urso v. Ercole [1992] was considered in the context of Italian law, the judgment differentiated between special administration proceedings with the intention of liquidation and continued trading whereby the rescue attempt was under the direction of a court appointed administrator, which was definitely within the scope of the Acquired Rights Directive 77/187/EEC. This meant it could assist in formulating persuasive arguments in similar circumstances in UK submissions. In the case of Spano v Fiat Geotech SpA and Others [1996] the CJEU again considered, Special Administration and its intention to improve the economic situation of the ailing business. The judgment stated the economic and social objectives within the procedures are designed to avoid liquidation and promote continuation of the business, concluding that the preservation of employees' rights in such circumstances were within the auspices of the ... Get more on HelpWriting.net ...
  • 38. Insolvent Trading Executive Summary This research report documents the findings of an empirical study of judicial findings (of superior courts) relating to the duty to prevent insolvent trading. The duty to prevent insolvent trading is the most controversial of the duties imposed upon company directors. Those who support the duty argue that it provides appropriate protection for the unsecured creditors of companies. Those who oppose the duty argue that it has the effect of making directors unduly risk adverse which can result in directors too quickly putting companies into voluntary administration or liquidation for fear of personal liability (which may have a negative financial impact on unsecured creditors). Overview Key points ... Show more content on Helpwriting.net ... Second, provisions such as section 588G may be deterring qualified people from becoming company directors and the provisions may be having this effect precisely in relation to those companies in financial difficulties which require the best possible expert assistance from directors. The major argument used to support the insolvent trading provisions is that they are necessary to protect the interests of creditors. As stated, insolvent trading provisions have generally ensured a conservative approach by directors when the company is experiencing financial difficulties. The potential alternative effects of such a decision are: 1. to preclude the company from trading out of its temporary insolvency, thus resulting in creditors not being fully paid in respect of their debt; and 2. to avoid the company dwindling away assets and further reducing any return to creditors. 4 What to do if you suspect financial difficulty If you suspect your company is in financial difficulty, get proper accounting and legal advice as early as possible, as this increases the likelihood of the company surviving.  An insolvency practitioner can conduct a solvency review of your company and outline available options, these may include refinancing, restructuring or changing your company's activities, or appointing an external administrator. The three most common forms of external administration are: 1. voluntary administration 2. ... Get more on HelpWriting.net ...
  • 40. Insolvency and Final Exam BUSL301 Final exam Session 1 2013 The exam does not include: Lecture Area 1–4 Lecture Area 9 [Week 10] (Takeovers / Financial Services and Markets) The Role of Auditors / ASIC Investigation (these are both in Lecture Area 7 [Week 8]) Everything else is examinable – that is, within the range of material that may be included in the final exam Part A of the exam (20 marks) is multiple–choice (10 x 2 marks per question) Part B of the exam (40 marks) has 2 problem style questions requiring written responses (15 marks each) and 1 short answer style question (with 5 questions worth 2 marks each). Look at the Unit Guide and the Assessment Guide Also on iLearn are: Coversheet for the exam Practice Questions Answer Guide to Practice Questions ... Show more content on Helpwriting.net ... (c) Only shareholders can call a general meeting of the company's shareholders. (d) In voluntary administration the directors share the running of the company with the administrator. PART B Question 1 Ben is a graphic designer and shareholder in Snowzone Pty Ltd ("Snowzone") a profitable graphic design company. He holds 200 of the 1,000 issued shares. The other 800 shares are divided equally between the other 16 graphic designers in Snowzone. Two of these other 16 graphic designers are the directors of the company. Ben did not support the election of these directors but a majority of the other shareholders voted for them. The company has paid dividends to the shareholders from time to time but not for the last 3 years. Snowzone uses computer hardware supplied by Nicola Pty Limited. The 2 directors of Snowzone, Larry and Ron, are in fact shareholders in another computer hardware supplier, Zabriski Pty Limited, and they, together with some of the shareholders of Snowzone favour a change in the hardware supplier to Zabriski Pty Limited. The directors accordingly call an extraordinary general meeting so that the shareholders can vote on a change of the hardware supplier. Ben has consistently voiced his opposition to a change to Zabriski Pty Limited. Ben has also recently begun ... Get more on HelpWriting.net ...
  • 42. Australian Insolvent Trading Introductions Company's business responsibility goes to the directors for the different subject's matter of the common law and statutory duties, with their honesty, positive faith and ability towards the company so that the company is prevented from insolvent trading. Insolvency affects not only the shareholders and employees but also the taxation authority, creditors and customers. Safe harbour, a provision set out for the trading companies to provide valid and authentic tax information through registered agent. This essay will show how the safe harbour provision will lead the directors on insolvent trading which results the company to restructure without any losses. Australian government has induced the significant policy considerations for ... Show more content on Helpwriting.net ... In the case of Hall v Poolman, where the court held that : (2007) NSWSC694) In some cases, it is not commercially sensible to summon the administrators or to abandon a substantial trading enterprise to the liquidators as soon as any liquidity shortage occurs. In some cases a reasonable time must be allowed to a director to assess whether the companys difficulty is temporary and remediable or endemic and fatal. HARRIS, Jason. Relief from liability for company directors : recent developments and their implications. [online]. UNIVERSITY OF WESTERN SYDNEY LAW REVIEW; (12) 2008: 152– 175. Availability: ISSN: 1446–9294. [cited 22 Aug 15]. In this case, court analysed that directors were attempting to sort out the problem of the debt reorganizing by sale of the asset and pay their creditors and restructure to restore solvency but it was also unclear that the reorganizing was actually attempted to sort out the insolvency or just in hit and trail so that they could actually come out of debt. So sometimes court also refer to commercial judgment which is based on expert advice to prospects for resolving the disputes with the creditors and regain ... Get more on HelpWriting.net ...
  • 44. The Case Of Salron V. Salomon & Co Ltd. PART A The issue is whether Mr Kenneth Lay is liable to contribute to the company's debts or not. Mr Lay is a separate legal entity under s.16 (2) Companies Act 2006. This is similar to the case of Salomon v Salomon & Co Ltd (1897) where Mr Salomon was held to be a separate legal identity from the company. However, according to company law there are exceptions in which the court is willing to lift the corporate veil. The court will lift the corporate veil where certain circumstances occur such as fraud, improper or wrongful acts. Mr Lay gambled away all of the company's assets and reserves which is a wrongdoing under s.361 Insolvency Act 1986. He knew that there was no reasonable prospect of avoiding insolvency as the company was bankrupt and failed to minimise the potential loss to the company's creditors. Therefore, s.214 (2) IA 1986 applies in this case and the court may declare that Mr Lay is to be liable to contribute to the company's debts as this is a wrongful trading under s.214 IA 1986. This is similar to the case of Brooks v Armstrong (2015) where the three principle conditions for wrongful trading were outlined. Furthermore, he carried on business affairs with no intent to pay the company's debts and for fraudulent purposes. This is an offence under s.993 CA 2006 and s.213 IA 1986. This is similar to the case of Contex Drouzhbu Ltd v Wisemen And Another Ca (2007) where the representation was made fraudulently as the director knew the company was insolvent and ... Get more on HelpWriting.net ...
  • 46. Insolvency Practitioners The rules regulating the independence of insolvency practitioners serve an important purpose in the profession; to secure public confidence in the impartiality and effectiveness of the regulations and discipline of the insolvency system. The purpose of my report is to comment on the expectations imposed upon liquidators including whether the Walton Constructions Pty Limited (2014) FCAFC 85 ("the Walton case"), sets an unrealistic standard. The importance of the Walton case is for insolvency practitioners to recognise the legal principles that can be drawn from the decision. Although I am able to appreciate the ideals behind the results of the Walton case and the standard this sets, my findings indicate that the decision made by the high court ... Show more content on Helpwriting.net ... There is a clear shift towards principles based regulation in the insolvency profession. The leading purposes of the Code is to provide broad principles that can be applied to a multitude of circumstances with the aim of averting practitioners from justifying a particular course of action via a loophole in the Act. The results of cases such as the Walton case serve as a reminder to practitioners that the Act merely provides a minimum benchmark as to the appropriate course of action and that practitioners should have regard to the requirements of the code when considering a new appointment. Interestingly, Honourable Justice Robertson made the following comment in the Walton case being that he does not regard the Insolvency Practitioners Association of Australia's guide as extrinsic material appropriate or permitted to be taken into account in construing s 60 and 436DA of the Act. Although this is the case, the Code is still pertinent to practitioners. As stated by Miss Alicia Hill and Jessica Patrick "although the Code cannot be directly taken into account in construing legislation, it has a very important place in regulating insolvency ... Get more on HelpWriting.net ...
  • 48. The Collapse of Hih – Solvency and Audit Risk The Collapse of HIH – Solvency and Audit Risk Following the collapse of HIH, considerable debate, comment and speculation have arisen regarding whether and at what point HIH became insolvent. When a company is close to insolvency, the risk associated with auditing that company is considerably higher than for one that is solvent. This report investigates methods of determining insolvency, the roles of directors and auditors, and the level of audit risk associated with HIH prior to its collapse. There is general agreement that the concept of solvency relates to having the capacity to meet debts as they fall due. An insurance company is solvent if it is able to fulfil its obligations under all contracts at any time (or at least under most ... Show more content on Helpwriting.net ... Cross guarantees exist where a subset of companies in the corporate group (the "closed group") guarantee the debts of each other. A regulatory–approved Deed of Cross Guarantee has existed in Australia since 1991. All subsidiaries party to a Deed of Cross Guarantee must make a solvency statement. HIH and its subsidiary, FAI insurance had cross guarantees in place. As a result of the cross guarantee, HIH adopted a "group enterprise perspective" when attesting to its regulatory solvency position. The company treated insurance subsidiaries as if they were part of a singular corporate group and "netted–off" related company assets and liabilities in several APRA annual returns . This contributed to the fact that the auditors did not identify that some subsidiaries were potentially insolvent. The risk that a company is insolvent is a component of audit risk, which should be taken into account by auditors. Audit risk is defined as "the risk that that the auditor will give an inappropriate audit opinion when the financial report is materially misstated". Auditors risk issuing an unqualified audit opinion on financial statements that are materially misstated or omit material transactions; therefore the procedures used in the audit must be planned according to the identified audit risk. The components of audit risk are inherent risk, control risk and detection risk. Inherent risk is the risk that the financial statements contain a material ... Get more on HelpWriting.net ...
  • 50. The Financial Difficulties Of The Insolvency Firms Are... Insolvency firms are becoming increasingly familiar with the restructuring and regeneration of local pharmacies due to the increased financial pressures in the changing landscape of the industry. There are approximately 4,022 pharmacies in Australia that inject $16.2 billion worth of revenue into the economy each year (IBIS World, 2015). Despite this, a combination of lowering prices and intensifying competitive pressures has resulted in an increasing number of bankruptcies in the industry, a notable example being the Pulse Pharmacy Group (IBIS World, 2015). In 2012, Guild President Kos Sclavos reported that 120 pharmacies had gone bankrupt in the past year and a further 300 were in 'financial distress' (Daniels, A 2012). Whilst this ... Show more content on Helpwriting.net ... Competition has also increased for the residual revenue streams, as there has been a growth in non– registered pharmacies that sell cosmetics, beauty products and other general retail products. These stores would not be subject to the strict ownership and location rules placed on official pharmacies and as such may benefit from more convenient store positioning. Figure 1: Revenue Growth Figure 2: Main Revenue Drivers (IBIS World, 2015) (IBIS World, 2015) 1. PHARMACEUTICALS BENEFITS SCHEME (PBS) The pricing structure of prescription drugs is regulated through the Pharmaceuticals Benefit Scheme (PBS). The Pharmaceuticals Benefits Scheme (PBS) was introduced by the Commonwealth Government in 1950 with the aim to lower the cost of drugs to the Australian Public (IBIS World, 2015). This scheme governs 80% of prescription machine and as such has reshaped the pharmacy industry as 62% of revenue comes from these products (KordaMentha 2015). The government establishes an Approved Price to Pharmacists that they will reimburse to pharmacies, however the pharmacies themselves can negotiate lower purchasing costs from drug suppliers so that the profit margin is increased as displayed in Figure 3 (KordaMentha, 2015). Pharmainfocus reported that in instances chemists are earning 50% profit margins due to negotiations with manufacturers, whilst still ... Get more on HelpWriting.net ...
  • 52. Insurance In Ancient Greece, bankruptcy did not exist. If a man owed and he could not pay, he and his wife, children or servants were forced into "debt slavery", until the creditor recouped losses via their physical labour. Many city–states in ancient Greece limited debt slavery to a period of five years and debt slaves had protection of life and limb, which regular slaves did not enjoy. However, servants of the debtor could be retained beyond that deadline by the creditor and were often forced to serve their new lord for a lifetime, usually under significantly harsher conditions. In the Torah, or Old Testament, every seventh year is decreed by Mosaic Law as a Sabbatical year wherein the release of all debts that are owed by members of the ... Show more content on Helpwriting.net ... The Joint Stock Companies Act 1844[9] allowed people to create companies without permission through a royal charter. Companies had "separate legal personality", the ability to sue and be sued, and served as an easy mechanism for raising capital through the purchase of shares (an equitable title) in the company's capital. The Act's corollary, to bring the existence of these "legal persons" to an end was the Joint Stock Companies Winding–Up Act 1844. The Limited Liability Act 1855 produced a further innovation. Before, if a corporation had gone broke, the people that lent it money (creditors) could sue all the shareholders to pay off the company's debts. But the 1855 Act said that shareholders' liability would be limited to the amount they had paid in their shares. So if you had invested £100 in a company, but now the company owed millions of pounds, the creditors could not come after you for the debts. You would lose £100 and no more. Your liability to pay debts was limited to the value of your shares. The Joint Stock Companies Act 1856 consolidated the companies legislation in one, and the modern law of corporate insolvency was born. Finally, the Bankruptcy Act 1869 was passed allowing all people, rather than just traders to file for bankruptcy. Debtors' prison, Fleet Prison, Marshalsea Prison, King's Bench Prison, Debtors' Act 1869 Charles Dickens, Hard Times, Mr Micawber in David Copperfield Modern development[edit] United ... Get more on HelpWriting.net ...
  • 54. The Insolvency Of The United Kingdom Economic recession is often mirrored by an increase in insolvency predicated transfers in turn creating an increased scrutiny of the surrounding law. The insolvency proceedings in the United Kingdom (UK) are underpinned by the Insolvency Act 1986, together with the amendments via the Enterprise Act 2002. Cessation of trading can occur as a result of Court intervention, a voluntary resolution passed by a general meeting or Company voluntary resolutions arrangements with its creditors. The principle differences of these proceedings are the objectives; liquidation is focussed upon realising and distributing assets, while administration is concerned with rescuing the company as a going concern. Another possible outcome is an insolvency device, receivership is limited to secured creditors which involves recovering a secured amount without winding up of the company. In providing further context it is useful to consider the origins of employee protection. Originally in the UK, it was common law based and terminated upon cessation of the business, regardless of any subsequent continuation, Ready Mixed Concrete (South East) Ltd v. Minister of Pensions and National Insurance, [1968] 2 QB 497 (MacKenna, 1968). The right to choose an employer was further explored in Nokes v. Doncaster Amalgamated Collieries Ltd [1940] 2 QB 497 with the conclusion that the right to choose should be restated, which individually may have been advantageous but could also jeopardise employees' jobs ... Get more on HelpWriting.net ...
  • 56. The Nature Of Eto Trading Co Ltd V. The nature of ETO in the context of business was effectively reconsidered in Thompson v. SCS Consulting Ltd & Ors [2001] EAT 34/00 with the emphasis for subsequent Employment Tribunals (ET) to consider if the principle reason for dismissal was demonstrably linked to the survivability and continuity of the business. The Employment Appeal Tribunal (EAT) affirmed the ET decision and the necessity of reviewing any evidence suggesting collusion between transferor and transferee regarding dismissals, together with consideration of the available funds for business continuation at time of the dismissal. By way of commentary based on a number of EAT decisions, the actual findings were dependent upon the timing so if occurring just prior to the transfer period, these were likely to be judged directly associated with the transfer. Conversely the casual link is more challenging to prove if the time delay was significant. To assist further analysis it is useful to consider Ibex Trading Co Ltd v. Walton & Others [1994] IRLR 564 EAT. In this case the employees were dismissed on the 16th October, 1991 with the effective date being the 4th November 1991, with the offer to purchase of the business on the 11th November and completed on the 13th February 1992. The EAT reaffirmed the ET decision that the dismissal was fair, as it was only connected with a possible transfer and not necessarily the actual transfer, and therefore it had not contravened the meaning of Regulation 8(1). In this ... Get more on HelpWriting.net ...
  • 58. Book Report On Republic Of Debtors Essay Book report on Republic of Debtors This book is written by Bruce H. Mann and published by Harvard University Press in 2002*. It is about the relationship between creditors, debtors and society culture underling the American bankruptcy act in 1800 and the new republic trends. In 1800, American published new bankruptcy act, and it brings huge change to our life. It has both good and bad influences. Bruce Mann wants to use this book to show that every different kind of economics transformations would boost America moving into Revolutionary era, no matter if it failure at moral or others. Mann wrote his book as third person point of view and analysed each cases such as female debtor and medical business, he said: "Observing debtors, creditors, lawyers, judges, legislators, ministers, writers, and others struggling with how the law should address the inability of men and women to repay their debts, whether through insolvency, bankruptcy, or imprisonment. At bottom, they were struggling with the place of failure of the new republic." (Mann, 5) The purposes of showing all the different law cases are letting readers fully understand the issues of American economic culture. This book is majoring in the audiences who are interested in legal business area, due to the detail analysis of influences from debtors. Bruce Mann used semi – formal writing style, it makes readers easy to understand his ideas, but also have clarity on the legal terms, for example: "The Pennsylvania statute ... Get more on HelpWriting.net ...
  • 60. Essay On Bank Resolution TRIGGERS FOR BANK RESOLUTION – RECENT DEVELOPMENTS AND ROAD AHEAD Chapter 1: Concepts and definitions Bank resolution is an evolving concept that is at the threshold of complete definition. While the term 'bank resolution' is a relatively recently engineered concept, various references and forms of it have developed over the last decade. The BCBS Supervisory Guidance on Dealing with Weak Banks, 2002 refers in detail to the characteristics of a weak bank and the various methods of dealing with them, including bank resolution. While this Guidance Paper refers to bank resolution as restructuring or closure of a weak bank, the IMF paper on Managing Systemic Banking Crises, 2003, refers to bank resolution as the intervention or takeover of insolvent or non–viable institutions by the authorities. Almost ten years later, after the experiences of the financial crisis, the definition of bank resolution has narrowed down to the special arrangements for banks that are failing or likely to fail. This more niche definition is utilized in post–financial crisis context, since earlier intervention (i.e. prior to the state of insolvency of a bank) is necessary to avoid greater systemic damage to the financial system. Bank resolution has now evolved to a more specific intervention mechanism where authorities identify problem banks before they become insolvent and take action to restore the bank to viability to prevent financial instability. Related concepts such as recovery and ... Get more on HelpWriting.net ...
  • 62. The Pros And Cons Of Insolvency Insolvency is the time when an individual, corporation, or other organization cannot meet its financial obligations for paying debts as they are expected. Insolvency can occur when certain things happen, some of which may include: poor cash management, increase in costs, or decrease in cash flow. A finding of insolvency is imperative, as particular rights are empowered for the creditor to exercise against the insolvent individual or organization. For example, exceptional debts may be paid off by dissolving assets of the insolvent party. Prior to proceedings, it is common for the insolvent entity to meet with the creditor in order to attempt to arrange a substitutable payment method. It is conceivable that a business may be "insolvent" in cash ... Show more content on Helpwriting.net ... Economies with good bankruptcy procedures are those that augment the total estimation of recovered debt at low cost. India needs to increase the recovery rate in order to determine creditors' to reinvest in viable firms and to continue lending by diminishing the time and cost to resolve insolvency and by selling in going concern, taking into consideration the fact that recovery rates are higher in going concern sales than in piecemeal liquidation. By taking these activities India will, have more developed credit ... Get more on HelpWriting.net ...
  • 64. The Problem Of Australia Insolvency Law Essay Introduction In fact, Australia insolvency law is known as one of the best insolvency law in western country. It provide a stable and fair circumstance for economy growth. The complete set of organizational structure make sure that the procedures are functional correct. The effective supervisory mechanism and detail rules can protect the legal interest of creditors. The creative voluntary administration provide precious opportunities for insolvent company to restart their business. However, recently, the insolvent trading law are cited as a reason why investors refuse to get involved in a startup. The negative impact of insolvent trading laws are regarded as the stumbling block of innovation and ambition. This article analyses the statement critically basis on historical data and cases. After discussing the necessity of the reform, the author provides some detail solution for the issue and give some comment on other people' suggested reform. Analysis In order to analyses the statement that "our current insolvency laws put too much focus on penalizing and stigmatizing the failures," the purpose of insolvency laws and the situation of the laws should be acknowledged first. Research conducted in The Early History of Bankruptcy Law (Levinthal, 1918) expresses that "In Ireland there was a practice of 'fasting on ', in which the creditor would stay at the debtor 's doorway to compel payment. The logic was that other members of the society would not allow the debtor to let the ... Get more on HelpWriting.net ...
  • 66. Director's Duty of Care Major Assignment: Directors' Duties Case Part A: Whether the directors are in breach of their duties of care, skill and diligence Issue1: who owes the duty? According to S 9, the person who is appointed to be a director or the person who is appointed to be an alternate director and is acting in that capacity, is a director of the company. (S9) As we can see from the case, Peter Pansy, Fred Fuchsia and Marie Gold are directors of the company, and Alison Astor who is appointed to fill a casual vacancy on the Board is also a director; therefore, they all owe duties. As the executive directors appointed a skilled person to manage the Australian wide floral delivery service on the internet, the pointed person is also a director. In a ... Show more content on Helpwriting.net ... (ASIC v Rich (No 2) (2003) 21 ACLC 672) Alison Astor was appointed to fill a casual vacancy on the Board, but he did not attend board meetings. As one of the minimum standards of care, skill, diligence proposed by the NSW court of Appeal stated, the directors need to contribute a certain time and effort to the company and attend board meetings regularly. As we can see from this case, Alison Astor did not exercise the required degree of diligence by failing to attend board meetings, so he had breached his duty of care. Part 2: Whether the directors are in breach of their duty to avoid insolvent trading. ISSUE #1 Who owns the duties? Directors including de facto directors and shadow directors are the only persons who have the duty to prevent insolvent trading. (textbook219) According to Section 588G, the director of the company that incurs a debt and is insolvent or becomes insolvent by the debt should have reasonable grounds for suspecting that the company is insolvent or becomes insolvent.( 588G) As mentioned in the Part A, all of the directors mentioned above own the duties. ISSUE #2 To whom In this case, the directors are owed duties to the company as a whole and also creditors. ISSUE #3 What are the duties? * When does a company incur a debt? Beside the deemed debts, there are other types of debt that are related to S588G. (text) A specific amount and incurring voluntarily by the company are two of principles ... Get more on HelpWriting.net ...
  • 68. The Pros And Cons Of Bankruptcy Premise of enacting the Insolvency and Bankruptcy Code, 2016 The Insolvency and Bankruptcy Code, 2016 came into force in August 2016. It is believed that the acid test for the Insolvency and Bankruptcy Code 2016 would come when the case involving Kolkata based Nico Industries is adjudicated. The adjudication process signals whether a sick company can be shut down within 180 days of the case being registered. While more than 1000 applications have been filed, 100 of them have been admitted by the arbiter in the National Company Law Tribunal or NCLT that is expected to decide the fate of these non–financial firms within 180 days. That aside, one begs to examine the nitty–gritties of the Code itself. What is Bankruptcy? Firstly, we must define as to what bankruptcy is? Bankruptcy is a legal status imposed by a firm or individual unable to meet obligations. Before the passing of the Bankruptcy Code, the legal framework in India with regard to this sphere suffered from a lack of clarity and certainty in jurisdictions. Decisions were often appealed, overstayed or overturned by judicial forums with concurrent jurisdictions. This has led to unnecessary delays often leading to misuse of this shortcoming by debtors. Therefore in this regard, the need for a new legislation was recognised. There were many reasons for this; 1. ... Show more content on Helpwriting.net ... Firstly, that Indian banks are ridden with debt. There is also a significant rise in Non–Performing Assets as well as restructured loans while the bad debts amount to 11% of the lending. 2. There was a growth in loans from 3.49% in 2013 to 8.3% in 2015. 3. Corporate bad loans constituted 56% of the total bad loans of state–run banks. 4. The number of companies pending litigation was ... Get more on HelpWriting.net ...
  • 70. Ambiguous Concepts Of Insolvency Between Temporary Lack Of... 1. Ambiguous concepts of insolvency between temporary lack of liquidity S588G impose a duty on directors stop a company trading while it is insolvent or would become insolvent. The provision requires directors take any reasonable steps to prevent incurring debts and maintain the maximum abilities to pay the present creditors or protect future creditors. The ultimately objective is to protect the creditors. According to S588G, as long as the directors suspect that the company is insolvent or would become insolvent and fail to prevent a company from insolvent trading, he or she would potentially personal liable for all the debts incurred since insolvency. Under S95A, A company is insolvent if it is unable to pay all its debts when they become due for payment (Hanrahan, 2015). It is difficult for directors to figure out whether the company is temporary lack of liquidity or insolvent. Furthermore, the uncertain local and global economic conditions would make them feel hesitant about whether the decision they make will save the company not. This provision put significantly personal liabilities on directors' shoulder. Directors special without company share directors would rather to simply give up saving the company by winding up or appointing an administrator than put their personal wealth on risk even though there is a chance to rescue it. One of the objective of appointing an voluntary administration is to put a company into a temporary" safety zone" from its creditors and ... Get more on HelpWriting.net ...
  • 72. Directors Duty Directors' duties in Australia are designed to promote good governance and ensure that directors act in the interests of the company – including putting the company's interests ahead of their own (A Guide to Directors' Duties and Responsibilities, 2008). In the case of OHS Solutions Pty. Ltd. in order to give advice it must first be known what are the duties and responsibilities of a director and officer. There are three sources of law in which directors' duties are enforced: the common–law (judge made), the Corporations Act 2001 (Commonwealth) (the "Corporations Act") and a company's constitution (A Guide to Directors' Duties and Responsibilities, 2008). There are both general law and statutory law duties that are owed by the director to ... Show more content on Helpwriting.net ... Referring to the case of Quick v Stoland (1998), there are four factors taken into account: All of the company's debts as at the time in order to determine when those debts were due and payable; All of the assets of the company as at the time in order to determine the extent to which those assets are liquid or are realisable within a time frame that would allow each of the debts to be paid as and when they become payable; The company's business as at the time in order to determine its expected net cash flow from business by deducting from projected future sales the cash expenses which would be necessary to generate those sales; and Arrangements between the company and prospective lenders such as its bankers and shareholders in order to determine whether any shortfall in liquid and realisable assets and cash flow could be made up by borrowings which would be repayable at a later time than the debts (James & Topp 2012). Furthermore there must be an objective test applied for reasonable grounds for suspecting that a company is insolvent. Also identifying if the director was knowledgeable. It must be referred to what a reasonable director from a similar size company would do in the same situation. Referring to the case of Hall v Poolman (2007), two companies had wounded up owing a substantial ... Get more on HelpWriting.net ...
  • 74. There are Four Types of Insovency: Voluntary... This essay aims to describe whether the law provides protection for the creditors who are not secured where the buyer becomes insolvent, and if the secured creditors can benefit from the retention of title clause or floating charge. Insolvency is the legal term that describes the situation where a debtor, which is usually a business or a person, is not able to pay his debts when they are due or in the usual course of business . Insolvency occurs from cash flow and recession. There are four main types of insolvency, voluntary arrangements, bankruptcy , administration and winding–up . Creditors are crucial beneficiaries at the process of insolvency and the law should provide them with the necessary tools to let them keep playing an active role in this process. When a company goes under, it drifts with many of its creditors. The term 'credit' is used to describe someone's financial standing, or to describe some form of financial accommodation. In this assignment we are concerned with credit in the sense of financial accommodation, which is fixed and floating charges. A creditor is someone who borrows money and repays this at a later date with interest and charges. Moreover, the Consumer Credit Act 1974 was created to regulate credit agreements. Later, the 2006 Act, aimed to create an ombudsman scheme, which would permit borrowers to challenge their case in court, enchase the powers of the Office of Fair Trading and allow debtors to confront unfair relationship with ... Get more on HelpWriting.net ...
  • 76. Bankruptcy Vs Bankruptcy Law Canadian law for bankruptcy and insolvency are different from the ones from other countries. The lawyers looking after these cases are often specialized in these laws that are in practice in Canada. Taneja Law is fortunate to have some of the best Bankruptcy and Insolvency Lawyers who can meet the laws laid down in the Canadian Law books. Our lawyers work in favor of both business owners and common people in Canada who face the charges of bankruptcy and insolvency. Considering Bankruptcy in the Canadian Law: If your business in run by you only or by a team of partners, then the court cannot separate the asset of your business from that of your own. In such a situation, it can be concluded that a business bankruptcy, in turn, is a personal ... Show more content on Helpwriting.net ... Some of the purposes of BIA are as follows: BIA permits an unfortunate victim of circumstances who is honest but is unable to pay off his debts. The BIA discharges from his debts, but that can be conditional. This can be taken as an opportunity to start again, and then pay back to his debtors. BIA does this just as its responsibility to rehabilitate an insolvent so that he can stand on his feet once again. BIA allows an investigation to find out the reasons behind financial affairs of the insolvent 'bankrupt'. This is just to find out the problems that he faces while running his financial activities. It does everything by setting aside the settlements, preferences, and other types of transactions that the insolvent makes. At Taneja Law, we are fully concerned about the financial and social conditions of the bankrupts, and that is why we take these cases with full sincerity, and our Bankruptcy and Insolvency Lawyers put their best efforts to make things good for them. We work with expertise and experience to help our clients face these cases and win them these cases in the ... Get more on HelpWriting.net ...
  • 78. The Case Of Salomin V Salomon & Co Ltd. Mr Lay is a separate legal entity under s.16 (2) Companies Act 2006. This is similar to the case of Salomon v Salomon & Co Ltd (1897) where Mr Salomon was held to be a separate legal identity from the company. However, according to company law there are exceptions in which the court is willing to lift the corporate veil. The court will lift the corporate veil where certain circumstances occur such as fraud, improper or wrongful acts. Mr Lay gambled away all of the company's assets and reserves which is a wrongdoing under s.361 Insolvency Act 1986. He knew that there was no reasonable prospect of avoiding insolvency as the company was bankrupt and failed to minimise the potential loss to the company's creditors. Therefore, s.214 (2) IA 1986 applies in this case and the court may declare that Mr Lay is to be liable to contribute to the company's debts as this is a wrongful trading under s.214 IA 1986. This is similar to the case of Brooks v Armstrong (2015) where the three principle conditions for wrongful trading were outlined. Furthermore, he carried on business affairs with no intent to pay the company's debts and for fraudulent purposes. This is an offence under s.993 CA 2006 and s.213 IA 1986. This is similar to the case of Contex Drouzhbu Ltd v Wisemen And Another Ca (2007) where the representation was made fraudulently as the director knew the company was insolvent and unable to pay. Although the company was bankrupt, he still insisted to others that the company was ... Get more on HelpWriting.net ...