When appointed to a receivership case, a licensed insolvency practitioner assumes the role of receiver. Their goal is to ensure that the indebted company can find a way to repay what it owes, while preventing the lender from losing out on the value of the initial loan. Ultimately, their responsibility lies with the creditor.
Although an insolvency practitioner will always want to save a struggling business wherever possible, the fact that key assets are sometimes sold off during the receivership process means there is often not much left for the company to sustain itself with. As a result, receiverships will often result in liquidation.
The main duties of a receiver include assessing the company’s future prospects and figuring out a pathway for it to escape financial distress. They must also secure and realise the firm’s assets, while managing its affairs to ensure that all debts are paid. This involves removing directors or employees if necessary. All strict protocols and regulations must be followed to the letter.