THE BASICS
What is Voluntary Administration (VA)?
Voluntary Administration is a formal insolvency process under the Corporations Act designed to protect companies that are insolvent or likely to become insolvent.
Directors appoint a registered Voluntary Administrator, who takes control of the company and conducts an independent review of its financial position.
The administrator investigates debts, assets and operations before recommending an outcome to creditors. Those outcomes may include:
- A Deed of Company Arrangement (DOCA)
- Return of the company to directors
- Liquidation
This structure provides immediate creditor protection while the company’s future is assessed.
Who benefits from Voluntary Administration?
The struggling company
Businesses facing insolvency or financial difficulties can use VA to address their issues while retaining some control over their operations.
Creditors
VA provides a structured process for dealing with debts, allowing creditors to recover a portion of what they are owed, rather than facing potential total loss through liquidation.
Employees
Shareholders
While shareholders may still face losses, VA offers a chance to salvage the business and potentially retain some value.
ADVICE, GUIDANCE AND ASSISTANCE
How a VA helps your business
Voluntary administration is a valuable process for companies facing financial challenges, offering a structured pathway to potential recovery.
By virtue of this structure, a framework of clarity, trust, positive action and respect is created. With this foundation, directors, creditors and administrators can work their way through the challenges and achieve great results.
Whether aiming to restructure debts or to ultimately wind down operations in a controlled manner, VA provides an opportunity for better outcomes in difficult circumstances.
The following points are critical to know about Voluntary Administration process:
You preserve some control and flexibility
Unlike liquidation, where control passes to a liquidator, voluntary administration allows the company’s directors to retain some control over the process.
They work alongside the administrator to propose a plan for recovery, giving them a chance to influence the outcome.
It's a fast process with quick results
Voluntary Administration is time-critical. The administrator must convene the creditors’ meeting within eight business days of their appointment.
This urgency allows for swift action to address financial distress, reducing the risk of further deterioration.
Includes a Moratorium on Debt Recovery
Upon the appointment of an administrator, a moratorium is placed on creditors taking legal action against the company.
This provides crucial breathing space for the business to restructure without the immediate pressure of debt recovery actions.
Rescue your business
The primary aim of voluntary administration help is to facilitate a turnaround for the business. If successful, it can lead to a more sustainable operation, preserving jobs and potentially increasing returns for creditors compared to liquidation.
Increases creditor confidence
The structured nature of voluntary administration can enhance creditors’ confidence in the process. Knowing there is a formal procedure in place can lead to a more cooperative environment, which can facilitate negotiations and compromise agreements.
Transparency fosters trust
Administrators are required to maintain transparency throughout the process.
They must report to creditors and provide regular updates on the company’s financial position and the proposed restructuring plan.
This openness fosters trust and allows creditors to make informed decisions.
Voluntary Administration & DOCA Help, Guidance and Assistance
Assess Insolvency Risk
A detailed review of the company’s financial position determines whether the business is insolvent or likely to become insolvent.
Prepare for appointment
We guide directors through the formal appointment of a registered Voluntary Administrator and ensure compliance obligations are understood.
Manage Creditor Communication
Clear communication with creditors helps stabilise the environment and reduce uncertainty.
Evaluate Recovery Options
We assess & guide whether a Deed of Company Arrangement (DOCA), restructuring proposal or orderly wind-down is the most appropriate outcome.
Supporting Directors Through the Process
Ongoing practical guidance ensures directors understand their responsibilities and available options throughout the statutory process.
Why choose Halo Advisory
Voluntary Administration requires both technical expertise and commercial judgement.
At Halo Advisory, we combine insolvency expertise with real-world business experience to help Australian businesses.
Director-Focused Guidance
We guide, advice and ensure directors understand their legal obligations and options before proceeding with voluntary administration and DOCA.
Clear, Practical Specialist Advice
Complex voluntary administration and DOCA processes are explained in straightforward terms.
A Grounded Approach
Our specialist assistance is informed by real business experience, not just legislation.
Structured Decision-Making
We help you evaluate outcomes carefully before committing to a course of action.
Frequently asked questions
What is the timeline of voluntary administration process take?
The standard timeframe is relatively swift, usually taking about 20 to 30 business days from appointment to the final creditors’ meeting.
To understand the timeframe in detail, read our article: How Long Does Voluntary Administration Last.
What is the cost of voluntary administration?
There is no fixed cost of voluntary administration.
This is because it is not a simple process, and there are several steps and processes involved. However, to get a better idea of how much voluntary administration can cost in your case, get in touch with Halo Advisory.
For more insights, read our article: How Much Does Voluntary Administration Cost?
Who appoints a voluntary administrator?
In most cases, the company’s directors resolve to appoint an administrator if they believe the firm is insolvent or likely to become so. Under the Corporations Act, a secured creditor or the court may also initiate appointment.
What happens during voluntary administration?
During voluntary administration, a registered administrator investigates finances, the statutory moratorium comes into effect and possible outcomes are outlined to the businesses’ creditors.
For detailed information, read: Voluntary Administrator Explained: What They Do, Who Appoints Them, & What Happens Next
Don’t wait for problems to escalate – let’s discuss your options.
Work with us to explore the ways we can turn things around.
Contact us today for a free, no-obligation consultation and take the first step towards financial recovery.
CHIEF FINANCIAL OFFICER
Virtual CFO
A virtual CFO provides financial guidance and strategic planning remotely, helping businesses manage finances without a full-time hire.
A STRONGER FOOTING
Small Business Restructure
By restructuring your company, we satisfy creditors, prevent insolvency, and steer your business towards a brighter future.
WHEN IT’S TIME TO CLOSE
Creditors Voluntary Liquidation
The CVL process winds down the company when it is insolvent, cannot pay its debts as they fall due, and/or if other options are not available.
A PATH TO MASTERY
Corporate Advisory
You can always be better at business. With our specialists on your team, we can highlight best practices, and share invaluable ways to improve your business.