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Appointing a business rescue practitioner? Make sure he meets these five requirements...

by , 10 February 2014
The Companies Act requires you to appoint a business rescue practitioner when you apply for business rescue. But before you do, your practitioner must meet these five requirements...

The Practical Accountancy Loose Leaf explains that either the courts assign a business rescue practitioner to you, or you propose one to the courts.

If you appoint your own business rescue practitioner, the court has the power to reject him.

Does your CC follow the CC Act or the Companies Act?

Do it right or face penalties

To ensure this doesn't happen, you must ensure your business rescue practitioner is the right man for the job before you approach the courts.
How do you do this?

Make sure your business rescue practitioner meets these five requirements before you hire him

#1: Your business rescue practitioner must be an accredited member of the Companies and Intellectual Property Commission (CIPC).

#2: He must operate in a legal, accounting or business management profession.

#3: He must NOT be subject to a court probation order.

#4: The Companies Act says your practitioner must not be disqualified from acting as a director.

#5: He must not have a relationship with your company that would lead a reasonable and informed third party to conclude that the relationship compromises his integrity, impartiality or objectivity.

Remember that a business rescue practitioner investigates business affairs, processes, property; and financial position. So it's crucial he's qualified, is in good standing and has integrity.

'If your business rescue practitioner doesn't meet all these requirements, don't hire him. Your creditors or the courts will appoint one for you,' says the Loose Leaf.

If you overlook this and hire him, the courts will reject him.

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