Necessary things for receivership-bankruptcy, Financial Accounting

Assignment Help:

Necessary things for Receivership

If no power to appoint a receiver is given by the terms of issue, the trustee for the debenture holders, or a debenture holder acting on behalf of himself and others, may ask the court to appoint a receiver.  Before such an appointment will be made it will be necessary for the applicant to show that:-

(a)    Default is made in payment of principal or interest
(b)    The company is being wound up, or
(c)    The security is in jeopardy.

An appointment will be made under (c) where there is a serious risk that the security may be seized to satisfy claims which do not rank in priority to those of the debenture holders, e.g., where unsecured creditors obtain a judgement and levy execution; but mere insufficiency of the security is not itself "jeopardy" re (New York Taxicab Co).

A body corporate may not be appointed S.345 (Companies Act 1962), nor an undischarged bankrupt, except under an appointment by the court S.346. The official receiver may be appointed if the company is being wound up by the court S.347.

The duties of a receiver are to get in and realise the assets subject to the charge - he has no power to carry on the business of the company; if such a power is required, as where there is a floating charge on the company's business or undertaking and it is desired to sell the business as a going concern, the receiver (or some other person) may be appointed manager to carry on the business for this purpose: if appointed by the court this will be for a limited period, usually three months.


Related Discussions:- Necessary things for receivership-bankruptcy

Explain about material event, Q. Explain about Material event? Subseque...

Q. Explain about Material event? Subsequent Event - Material event which takes place after the end of accounting period and before the publication of an entity's FINANCIAL STAT

Financial accounting, Financial Accounting An accounting technique that...

Financial Accounting An accounting technique that records, interprets, and reports the historical cost transaction of an organization. An organization records these transaction

Compute the effect on retail sales, Molina Medical Supply Company is trying...

Molina Medical Supply Company is trying to decide whether or not to continue distributing hospital supplies. The following information is available for Molina's business segments.

What is capital gain, Q. What is Capital Gain? Capital Gain - Portion o...

Q. What is Capital Gain? Capital Gain - Portion of total GAIN recognized on the sale or exchange of a no inventoryasset that isn't taxed as ORDINARY INCOME. Capital gains have

Liquidity ratios, Liquidity Ratios - These ratios include the Current Rat...

Liquidity Ratios - These ratios include the Current Ratio and the Quick Ratio or the acid test ratio. Liquidity ratios show the Liquid position of a company in the short term i.e

Adjusting entries, Adjusting Entries Clapton Guitar Company entered into th...

Adjusting Entries Clapton Guitar Company entered into the following transactions during 2013. [The transactions were properly recorded in permanent (balance sheet) accounts unless

Financial statements, are the notes to the financial statements part of the...

are the notes to the financial statements part of the financial reporting

Static balancing-dynamic balancing-field balancing, Static Balancing : Th...

Static Balancing : This balancing is complete in the plane of unbalance. Dynamic Balancing : In this case two balance planes are needed because forces along couples are to

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd