What happens whilst my business is “in Administration”?

Frequently Asked Questions

Administration is an insolvency process by which a company is placed under the control of an insolvency practitioner to enable him to achieve objectives laid down by law.

Company Administration Process

Whilst your business is ‘in administration’, it is effectively under the control of ‘the administrator’ – it’s a period of time whereby the company begins to reorganise its affairs. The administrators may be appointed by either a lender (such as the bank) or the directors. The first objective of administration is to rescue the company so that it can continue trading. If the circumstances allow, the administrator will continue to trade the business in an attempt to try and put it back into a stable position. This can result in the reigns being handed back to the directors to continue as before.

What if my business in administration cannot be saved?

If the rescue of the company is not possible, the administrator must try to obtain a better result for the creditors of the company as a whole, than would be likely if the company was put into liquidation. To assist in achieving these objectives, the company is protected from creditors taking or pursuing legal proceedings against the company while it is in administration.