Practical Law ANZ Glossary w-004-2120 (Approx. 4 pages)
Glossary
Voluntary administration
A type of external administration in which an administrator is appointed to a company in financial distress. The purpose of voluntary administration is to give the company a short period of time ("breathing space") to determine whether a restructure or re-organisation plan (a deed of company arrangement (DOCA)) can be developed and executed. This may be possible where the company or its business (or some part of it) is salvageable. During voluntary administration, there is a moratorium on any enforcement or other proceedings being continued or commenced against the company.
The administrator's role is to assess the company's financial position, investigate the company’s affairs, report to its creditors and determine which of the following options is in the best interests of creditors:
A liquidator or provisional liquidator if they decide that the company is insolvent or is likely to become insolvent at some future time (section 436B, CA 2001).
The conduct of a voluntary administration is governed by: