Insolvency and restructuring

Chartered Accountants play a key role in the field of insolvency and restructuring.

In Brief

  • Insolvency and restructuring are increasingly viewed as specialised services. Maintaining a high level of ethics and standards is important for those working in this field
  • A statutory licensing regime for insolvency practitioners will take effect in New Zealand on 1 September 2020
  • In Australia we work with the Australian Restructuring Insolvency and Turnaround Association (ARITA). ARITA is an independent, self-governing association of insolvency specialists

New Zealand

Currently, New Zealand insolvency practitioners are regulated under the voluntary CAANZ / RITANZ accreditation scheme.

However, the Insolvency Practitioners Regulation Act 2019 introduces a new statutory regime for insolvency licencing. Under the Act, insolvency practitioners will have to apply to an accredited body (for example NZICA) to obtain a licence and become a licensed insolvency practitioner. In most circumstances, it would be an offence to undertake an insolvency engagement without a statutory licence.

The voluntary CAANZ/RITANZ accreditation scheme will be replaced, in due course, by the Act's statutory regime.

Australia

The Australian government passed the Insolvency Law Reform Act 2016 on 22 February 2016. This made changes to both bankruptcy and corporate insolvency laws.

The Government has subsequently made reforms that:

  • Allow directors of financially distressed businesses a new 'safe harbour' to turn around their business free of the worry of being personally pursued for insolvent trading actions; and
  • Make certain ipso facto clauses unenforceable so contracts can be terminated in instances of insolvency, when a company is restructuring

Further reforms are currently progressing with the aim to reduce insolvencies by more flexible options to turnaround businesses in crisis.

These include:

  • Reducing the bankruptcy period from three years to one - currently before Parliament
  • Combatting illegal phoenix activity – currently being consulted on
  • Introduction of Director Identification Numbers (DIN) as part of the modernising business registers project
  • Addressing corporate misuse of the Fair Entitlements Guarantee – currently being consulted on.

More information

Visit the Australian Restructuring Insolvency and Turnaround Association (ARITA).

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Engagement standards

Members who carry out insolvency and restructuring engagements must follow prescribed standards. These are for New Zealand, IES: Insolvency Engagements. For Australia, APES 330: Insolvency Services

More information

View the standards in full.

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Insolvency Management Committee

We provide a forum for members interested in insolvency through our Insolvency Management Committee. It offers an opportunity to engage in all forms of insolvency regulation, be part of discussions around best practice, and hear about useful tools and resources. It also provides opportunities to collaborate with other relevant professional bodies.

The committee members are as follows:

Andrew Barden FCA (Chair) Rodgers Reidy NSW
Jason Bettles FCA Worrells QLD
Melissa Humann CA PwC VIC
Peter Lucas CA P. A. Lucas & Co QLD
Anne Meagher CA SV Partners QLD
Stephen Michell CA PCI Partners VIC
Alice Ruhe CA SMB advisory VIC & QLD
Bruce Gleeson FCA Jones Partners NSW
Hayden White CA KPMG WA
Andrew Heard FCA Heard Phillips Lieberenz SA

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