If that causes public or policy consternation, then there are a number of options: Australian Insolvency Management Practice Readers will notice that the Practice is well progressed on being updated with the new law, along with commentary and guidance.
It remedies a dysfunctional and opaque aspect of the funding of the corporate insolvency regime that has served to diffuse the its costs across the profession itself and those creditors receiving dividends from insolvent companies.
Ultimately, it is the creditors of companies with assets who fund the regime, by way of reduced dividend payments.
Statistics in personal insolvency are kept that provide a clearer picture of these costs, including the comparative funding models and realisations-to-costs ratios between private trustees in bankruptcy and the government Official Trustee.[viii]Possible consequences But now that the concept of an official liquidator is being repealed, some of the economic distortion and lack of transparency arising from the official liquidator role should be removed.
Funding of the regime by official liquidators The reality of this situation is revealed by a 2013 report that official liquidators personally fund over million in work that is not paid because the assets are not there from which to recoup their remuneration and outlays.[v] A factor here is that the law requires liquidators to not only maintain and lodge accounts, but to conduct investigations and report, and carry out related work.
This is irrespective of whether there are funds to pay for their remuneration, or expenses, in doing so.