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It is usual for a company to continue
to trade while in administration.
The financing of that trading is
a key issue which should be considered prior to the administrators
appointment.
An administrator has the initial
cash flow benefit of not having to pay old creditors (as they
are "frozen" as a result of the administration order).
The administrator is likely however to have cash flow pressures
as suppliers to him are likely to request "cash with
order".
The preparation of a cash flow
forecast for the administration trading period can be seen
to be a pre-requisite for a successful administration.
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