Week 12 - Liquidation Flashcards
1
Q
What is liquidation/winding up?
A
The process which dissolves a company
2
Q
How does liquidation work?
A
- realisation of assets
- discharge of liabilities
- distribution of any surplus
3
Q
How can you apply for liquidation?
A
Apply to the Registrar of Companies for removal from the register
4
Q
What must you do to be able to apply for liquidation if the company is operational?
A
If the company is operational, must first be put into either compulsory or voluntary liquidation
5
Q
Two types of voluntary liquidation can be initiated by the members passing a special resolution:
A
- members’ voluntary winding up
- creditors’ voluntary winding up
6
Q
What is the key difference for voluntary liquidation?
A
The difference is NOT whether the members of the creditors initiate the winding up, rather the key difference is whether the company is solvent or not
