Popular Vietnamese tuckshop business, MissChu, was placed into voluntary administration last month. The founder and creative director of MissChu, Nahji Chu, also known as The Queen of Rice Paper Rolls, started MissChu as a catering business in 2007 which expanded into retail tuckshops in Sydney, Melbourne and London, employing about 190 people across its retail tuckshops, commercial kitchen and head office. The company’s appointed administrator is KordaMentha Restructuring – one of a number of companies that provide strategic and financial analysis of distressed businesses and formulate strategies to deliver the best possible results for all stakeholders, including staff and creditors. The Sydney Morning Herald reported KordaMentha’s Rahul Goyal stating “Financial pressures of MissChu have been caused by the lack of controls over fixed costs in the business, the expansion of the retail tuckshops through trading and the closure of the Opera House premises without notice.” [1] What is a voluntary administration? The Australian Securities and Investment Commission (ASIC) defines voluntary administration as an insolvency procedure where the directors of a financially distressed company or a secured creditor with a charge over most of the company’s assets appoint an external administrator called a ‘voluntary administrator’. The role of the voluntary administrator is to investigate the company’s affairs, to report to creditors and to recommend to creditors whether the company should enter into a deed of company arrangement, go into liquidation or be returned to the directors. [2] What should you do if one of your business customers goes into voluntary administration while owing you money for goods or services supplied? Once the decision is made to appoint an administrator, a prescribed voluntary administration process begins. One of the first responsibilities of the business’s appointed voluntary administrator is to notify creditors of the voluntary administration and to hold talks with the staff and creditors. The first meeting of creditors must be called within eight business days of the appointment. After investigating the affairs of the company and forming an opinion on the options available to creditors, the administrator must call a second creditors’ meeting. At this meeting, creditors are given the opportunity to decide the company’s future. This meeting is usually held within 25 or 30 business days after the company goes into voluntary administration. As a creditor you can attend and vote at the creditors’ meeting. You can make a claim for monies owed by completing a form called a ‘proof of debt’, available from the voluntary administrator. You will need to attach copies of any relevant invoices or other supporting documents to the claim form. The likelihood of you receiving the full amount of the monies owed depends on the decision reached at the second creditors’ meeting about the company’s future, whether there are sufficient funds available for unsecured creditors and the order in which creditor claims are paid. Normally employee entitlements are paid in priority to other unsecured creditors unless eligible employees have agreed to vary their priority. For more information on the essential steps to take if you find your business in this situation, the ASIC website provides a useful resource. [1] http://www.smh.com.au/business/misschu-founder-vows-a-comeback-20141223-12czit.html#ixzz3OIqfitgN [2] http://asic.gov.au/regulatory-resources/insolvency/insolvency-for-creditors/creditors-voluntary-administration/
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I believe in women. Women can make a significant difference in senior management, the boardroom and beyond. Throughout the last 20 years in executive positions, on advisory boards and committees, and being COO of a $100M private company, I have frequently been the only woman ‘at the table’. Leading with...