ASIC has released a report containing the key messages and outcomes of its National Insolvent Trading Program (NITP). The report (REP 213) will benefit company directors, advisors (accountants and lawyers), and other interested stakeholders by assisting them to understand and comply with their duties to prevent insolvent trading under the Corporations Act.
The NITP provided four key messages that directors should consider when carrying our their role. Directors must:
- maintain appropriate books and records;
- identify insolvency concerns and assess available options;
- seek professional advice; and
- act in a timely manner.
“Where a director follows these key messages, they are less likely to breach their duties under the Corporations Act and by seeking advice at an early stage, better results may be achieved for external stakeholders, including employees and creditors”, ASIC Commissioner, Michael Dwyer said.
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