Company Voluntary Arrangement

CVA – Solvent Business

Voluntary meaning: (freely; willingly; intentionally; deliberately)
Arrangement meaning: (orchestration; order; method; sequence)

An Insolvency Practitioner is appointed as ‘supervisor’ of a scheme whereby the ‘debtor’ – limited liability company formally proposes repayment terms to it’s creditors and shareholders, in part or in full, of their debts owed over a period of time. Once a scheme is agreed and all creditors have been formally notified, each historic creditor due payment of debts owed, are bound by the scheme, thereby providing preservation of the business and assets to the advantage of all concerned.
 

Key Issues:

• There must be a Core business to rescue.
• The Directors remain in control of the company and must act responsibly for the survival of the company. A ‘supervisor’ does not have the same powers as that of a ‘receiver’, the company is monitored and the supervisor’s duties are to administer the scheme through to it’s completion. Failure of such a scheme could pre-empt Receivership or Liquidation.
• See ‘Disqualification of Directors’.