Should you put your company into voluntary administration?

What administration changes straight away

When creditors are closing in, voluntary administration can stop the scramble and give the company breathing room. ASIC says the voluntary administrator takes full control of the company, and directors cannot use their powers while the administration is on foot. That handover changes who makes the calls, who signs off payments, and who speaks for the business.

The practical effect is immediate. The administrator investigates the company’s business, property, affairs and financial position, then reports to creditors on the options. If you are hoping to keep trading, this is not a wait-and-see step. It is a formal process that tests whether the company can be saved, restructured, or should move on to another outcome. ([asic.gov.au](https://www.asic.gov.au/regulatory-resources/insolvency/insolvency-for-creditors/voluntary-administration-a-guide-for-creditors?utm_source=openai))

Who takes control, and what it can cost

A voluntary administrator is not a side adviser. ASIC says the administrator takes control of the company, while directors must help by providing books, records and the report on company activities and property. That means the company may still be trading, but the decision-making centre has shifted. If creditors, staff or suppliers are asking for answers, the administrator is now the person to deal with.

Cost matters too. Administration is not free time. Debts incurred during the administration, if authorised by the administrator, are paid as costs of the administration from available company assets. For a strained business, that means the process can buy time, but it also creates new obligations and may use cash that would otherwise have gone elsewhere. ([asic.gov.au](https://www.asic.gov.au/regulatory-resources/insolvency/insolvency-for-creditors/voluntary-administration-a-guide-for-creditors?utm_source=openai))

Source: Official guidance

Check whether a DOCA is realistic

The key question is whether a deed of company arrangement is a real option or just a hopeful one. ASIC describes a DOCA as a binding arrangement between the company and its creditors, agreed after voluntary administration begins. If the business has no credible path to keep operating or pay something meaningful to creditors, administration may still end in liquidation.

That is why the figures matter before you appoint anyone. You need a clear view of cash at bank, aged payables, tax debt, wages, secured debt, work in progress and what is still coming in. If the numbers do not support a workable proposal, you may only be buying a short pause. If they do, the administration can create space to test a deal that creditors might actually back. ([asic.gov.au](https://www.asic.gov.au/regulatory-resources/insolvency/insolvency-for-creditors/deed-of-company-arrangement-for-creditors?utm_source=openai))

Prepare your figures before creditors move first

Do not wait for the first formal notice before you get organised. Pull together the basic records now: contracts, invoices, payment history, BAS or tax pressure, wages, supplier arrears, and any secured debt documents. ASIC’s process moves quickly, with the first creditors’ meeting within eight business days and the second meeting within 25 business days in the ordinary case, so the window to prepare is short.

You should also check whether any security interests, guarantees or disputed invoices change the picture. A poor file can create delay right when speed matters. If your figures are incomplete, you may not know whether administration is a sensible bridge, a negotiating tool, or simply a sign that creditors are about to force the issue anyway. ([asic.gov.au](https://www.asic.gov.au/regulatory-resources/insolvency/insolvency-for-creditors/voluntary-administration-a-guide-for-creditors?utm_source=openai))

Get advice before the pressure becomes a filing

If your company is under pressure now, the safest next step is to get advice before creditors act first. That gives you time to test the numbers, think through a possible DOCA, and understand what administration would mean for control and cost. Once the appointment is made, the process tightens quickly and the choices narrow.

If you want a practical view of the options, CRP can help you organise the file and coordinate independent qualified professionals who handle insolvency matters. Call CRP today about insolvency services so you can move with a clearer picture, not a last-minute guess. This article is general information only, not legal advice, and no outcome can be promised. ([asic.gov.au](https://www.asic.gov.au/regulatory-resources/insolvency/insolvency-for-creditors/voluntary-administration-a-guide-for-creditors?utm_source=openai))