This is the procedure that directors choose to bring down the business to a halt by appointing a licensed insolvency practitioner to sell assets and pay creditors and give any money remaining to shareholders due to bankruptcy. So how long does voluntary liquidation take?Voluntary liquidation can take between one and two weeks to be complete following a procedure:
- Submission of documents relating to voluntary Liquidation. This is to aid in the paperwork of the company’s assets and also a declaration that the company is giving its way out to allow selling of the assets. The documents submitted are:
- Solvency statement and last assessment that show assets at estimated realizable values with expected rank payments.
- Notification of the appointment of liquidator by members.
- Notification of the appointment of liquidator by creditors.
- Attachment of the declaration of solvency.
- For anyone wondering ‘how long does voluntary liquidation take?’, company declaration of solvency and last assessment of assets and liabilities.The company has to give out the assets to declare its readiness to give out its assets.
- Members of resolution
- Publication of the decision for voluntary liquidation.
Consequences of liquidating a company
- Damage entitlement
When a company orders a liquidation it means that a notice of company dismissal to all employees is given.
- All the directors will have no powers when the liquidator has been appointed.
- The properties cannot be disposed by the company as it loses power over them.
- The company can carry on business only for the
purpose of completing the liquidation process.
Order of distribution of assets
There is a hierarchy of asset distribution according to priority enforced by the courts. First off are the secured creditors getting the upper hand and are paid off before there is a distribution and after this the part of paying remaining debts are paid as follows:
- All the charges and expenses that were made during the liquidation.
- Salaries and all the wages that the employees owe.
- Then the unsecured creditors
- Any debt that became due to before the process
- Dividends of profit and debts owed by shareholders
How long does voluntary liquidation take for your company? Liquidation is the last sign to show that the company has failed immensely and cannot stand on its own anymore. The sensitivity of the matter requires that the company is dissolved so that auctioneers are not sent by debtors who would sell assets at a very big loss to only gain their debts and not to sell the assets with the correct pricing.