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Administrator
Practical Law ANZ Glossary w-004-5325 (Approx. 4 pages)
Glossary
Administrator
An insolvency practitioner who is appointed to conduct the voluntary administration of a company in financial distress.
An administrator may be appointed by:
- The company itself, when the directors decide that the company is either insolvent or likely to become insolvent (section 436A, Corporations Act 2001 (Cth) (CA 2001)).
- A secured creditor holding a security interest over all or substantially all of the company's property (section 436C, CA 2001).
- 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).
During the administration, the administrator controls the company's business, property and affairs and has broad powers to manage the affairs of the company (section 437A, CA 2001). The administrator's primary role is to investigate and report to the company's creditors on the company's business, property, affairs and financial circumstances and the options available to the creditors, being:
- To approve a deed of company arrangement (DOCA) which may involve a restructure or reorganisation of the company and part payment of creditors' claims.
- To place the company into liquidation (otherwise known as a winding up).
- To end the voluntary administration and return the company to the directors' control.
The administrator must give their opinion on each of the three options and recommend the option that is in the best interest of the company's creditors, which they will then ultimately vote on.
The conduct of a voluntary administration is governed by:
For further information, see Practice note: overview, Voluntary administration.