Creditor’s Voluntary Liquidation- Insolvent Company Liquidation

Liquidation is the well-known process of closing the company or business permanently. In this process the process of terminating the business is carried out in different ways. These ways are decided as per the way of doing the business and the type of company. There are two types of companies including solvent and insolvent. Insolvent companies use two types of liquidations. Creditor's voluntary liquidation is one of those liquidations used for insolvent companies.

In creditor's voluntary liquidation director or shareholder of the company insists the liquidation. The meeting informing the creditors regarding the insolvency of the company is held by a special person appointed as insolvency practitioner. It also calls for a liquidator for the company. Liquidator is the person who helps the company's assets to be sold properly.

The liquidator is also responsible for distributing the sold assets among the creditors of the company properly. The process of liquidation includes lots of process and these are carried out step by step by respected people. Other than the above things canceling the pending leases is also the responsibility of the liquidator and then it also closes down the company permanently. So that the creditor's voluntary liquidation is one type of insolvent company liquidation and very much helpful in selling the business and paying off the creditors.

The remaining techniques will be discussed in the part of Canadian Liquidation.