Directors - Role assisting external administrator
Generally, directors have an obligation to assist the external administrator by:
advising the external administrator of the location of company property and delivering any such property in their possession to the external administrator
providing the company’s books and records to the external administrator (voluntary administration and liquidation) or giving access to the books and records to the external administrator (receivership)
advising the external administrator of the whereabouts of other company records
providing a written report about the company’s business, property and financial circumstances (commonly referred to as a RATA) within either 5 business days (voluntary administration), 7 days (creditors’ voluntary liquidation) or 14 days (receivership and court liquidation) of the appointment of the external administrator, and
meeting with, or reporting to, the external administrator to help them with their enquiries, as reasonably required.
Directors, officers and other people with relevant books and records have a responsibility to the company and to creditors, and must not obstruct external administrators in carrying out their duties.
Where a company officer fails to comply with their responsibilities, the external administrator may refer the matter to ASIC. Such referrals have frequently resulted in ASIC taking court action to assist the orderly realisation of assets or to force directors to provide RATAs and/or books and records. We regard failure to provide a RATA or to disclose and deliver up books and records as a serious breach of the Corporations Act.