Your early restructuring adviser may not be able to take every later role
Clarify whether prior advisory work or relationships affect a contemplated later external-administrator appointment, without declaring all pre-appointment advice disqualifying.
Corporate Recovery Partners
01 / 06
The adviser is helping before a formal decision
You ask a firm for early restructuring advice and assume the same person can automatically handle any later administration or liquidation. Raise that assumption at the start. The advisory engagement and a formal appointment involve different roles. Understanding the possible limits helps avoid a rushed handover if the company's position later requires a different process.
Tell the adviser about prior work for the company, directors, related businesses and significant creditors that you know of. Include any personal advice given to you where relevant. Do not decide which connections matter by leaving uncomfortable information out. The professional needs enough detail to assess the proposed role and identify any further enquiries.
ASIC explains that a prospective external administrator must consider relationships, including earlier work and advice, when assessing independence. Ask how that applies to the contemplated appointment and what process will be followed. This does not mean every earlier discussion prevents an appointment, nor that disclosure alone resolves every conflict. Obtain an explanation specific to the facts.
Imagine a firm advises a director about a proposed transaction and the company later needs formal insolvency advice involving examination of that transaction. The director expects the original adviser to take the appointment immediately. Flag the earlier work and ask whether another practitioner is needed. The example illustrates a potential issue for assessment, not an automatic finding against the firm.
If a different professional may be required, ask what records can be transferred with authority and how urgent deadlines will remain covered. Keep company and personal advice distinctions clear. Do not assume all files are freely shareable or ask either adviser to ignore a concern simply because changing firms feels inconvenient at a difficult time.
Record the current engagement and who will assess any later appointment. Continue seeking timely advice as the company's position changes; an unresolved role question should be escalated promptly. The useful outcome is a realistic professional pathway with relevant relationships disclosed, rather than discovering at the last moment that an assumed appointment cannot proceed as expected.
