Accounting careers in insolvency
Want to save distressed companies? As part of our series on different career paths within accountancy we turn to an area of accountancy and finance which is in the spotlight at the moment - insolvency.
What is insolvency?
Insolvency focuses in two main areas: helping a company experiencing financial difficulties and supporting a company through the liquidation / bankruptcy process.
Accountants can offer advice on how to improve a company’s cashflow and suggest and support other ways in which a company’s finances could be restructured to enable the organisation to continue trading.
When a business cannot be saved, it will need an expert in insolvency to guide them through the process. This is where accountants come in. This role will often involve coordinating the sale of the organisation’s assets and paying creditors.
What type of work does this involve?
Accountants that specialise in insolvency and business recovery often work as advisers in accountancy firms, professional service companies, banks or independent advisory firms.
An accountant’s role, along with technical analysis, will involve a lot of time which is spend negotiating with finance providers and explaining to stakeholders the nature of the agreements in place.
Work that you might carry out may include:
Advising on the effective management of cash and working capital;
Securing finance (e.g. loans from a bank or raising equity from share issue)
Renegotiating existing finances
Guiding the business through the insolvency or winding-up process
Explaining legislation and timescales for legal proceedings
Coordinating and communicating with a large teams of professionals - lenders, lawyers and senior leadership
Strategic restructuring planning
Advising on improvement areas
Why work in insolvency?
Accountants working in insolvency provide valuable advice to companies at challenging and difficult times. This support can help struggling businesses to bounce back, and helping to save the jobs of many people within a company in trouble. This work can be very rewarding from a job satisfaction perspective.
For business which are not able to continue trading, accountants can help to ensure the process goes as smoothly as possible for all involved at a difficult and sensitive time.
The job can be very challenging at times and requires someone with strong emotional intelligence and professionalism. You will need to work professionally, often being privy to very sensitive information, whilst also showing empathy to the situation the company finds itself in.
Would insolvency suit me?
A career in insolvency would suit an individual that:
Has great commercial awareness
Is able to act in a professional and empathetic manner in highly sensitive situations
Has great interpersonal and communication skills
Is able to explain complex scenarios in simple language
Is adaptable and flexible
Enjoys working in a fast-moving environment
Can act in a diplomatic manner in contentious situations