An insolvency practitioner has to have a blend of impeccable technical acumen, excellent people skills and an ability to spot connections between various parts of a complex case. ICAEW Head of Qualifications Strategy and Development Adam Birt says the best practitioners are able to strike the right balance between empathy and focus.

IPs will work out which process, such as a liquidation or MVL, would deliver the best return for creditors when they meet with directors of companies and individuals who are in financial distress. The decision they make can have far-reaching consequences for a business or individual, so their professional judgement is critical.

Insolvency Practice: A Comprehensive Overview

A reputable practitioner will not recommend a formal insolvency procedure such as winding up proceedings if alternative rescue and restructuring steps could be taken to avoid one. They should also be able to explain the different options available, their costs and likely timelines.

Insolvency practitioners must be able to demonstrate that their staff are appropriately trained and that the quality of their work is monitored and assessed regularly by their authorizing body. They should have adequate records to ensure they meet their legal obligations, for example, to report to the department of trade and the Procurator Fiscal, and comply with the Statement of insolvency practice in Handling of Funds in Formal Insolvency Proceedings.

They will need to realise assets, both physical and intangible (book debts) for the benefit of the insolvent estate, in a timely manner. In some proceedings they will also investigate the conduct of the insolvent company or individual in order to report back to the insolvency service, and to consider whether company director disqualification or bankruptcy restrictions should be brought against the insolvent person.