Going concern is simply ignored when
a company goes into a pre-pack administration, leaving creditors reeling,
says Rob Mason
With the announcement at the start of the year that La Senza
and Blacks Leisure were both facing administration, is it time to
start questioning the fundamentals for small businesses which rely
on the big boys for their income?
The argument is that securing employee jobs at the existing
business is one of the main reasons for the rescue packages, but this
leaves the unsecured creditors unfairly penalised.
At the same time, the banks and the large accountancy firms
are usually preferential creditors.
Are these pre-packaged administrations really in the best interest
of wider society? Or do the benefits favour some preferred creditors
– banks, administrators and, in some cases, landlords.
