Corporate Talk WA

A liquidation is the winding up of a company’s affairs. To complete a liquidation a company’s assets need to be realised, operations ceased or sold, proceeds of assets distributed amongst creditors and any surplus distributed amongst shareholders. The four types of liquidations are: Official or Court liquidation Provisional liquidation Creditors’ voluntary liquidations Members’ voluntary liquidations Official and provisional liquidations are considered involuntary liquidations while creditors and members liquidations are voluntary. Involuntary Liquidations Official Liquidation This type of liquidation begins with an application to the courts usually made by a creditor, shareholder, director of the company or ASIC. The federal or Supreme Court may then issue an order to begin liquidation of the company. Provisional Liquidation This form of liquidation rarely occurs. It involves an application made to the Court following a dispute between the directors and sharehold...