PRESIDENT of the Business Recovery and Insolvency Practitioners Association of Nigeria (BRIPAN), Chimezie Victor Ihekweazu (SAN), has said that in light of the changing world and numerous economic challenges many businesses are facing, business owners should engage business recovery experts to save businesses before they actually fail.
He stressed that they are willing and ready to support business recovery and the practice of insolvency, as well as help failing or challenged businesses come back to life.
Speaking at the members’ night, which held recently in Lagos, he said the association is made up of accountants, lawyers, and bankers, including tax practitioners with a special bias for insolvency, who are trained to salvage businesses and prevent them from going under.
Touching on the rapid demise of businesses shortly after they launch, he said insolvency is not immediate but starts showing signs a year or two before actual insolvency happens.
He stressed that when these signs begin to manifest, businesses should engage experts to support with the right knowledge so that they can be rescued and effective business recovery achieved within the scope of the law and practice.
“Under the new Companies and Allied Matters Act 2020 (CAMA), there are a number of options that have been introduced, including administration, company voluntary arrangement, receivership, liquidation, and so on, which have all been reinforced with suitable provisions to support business recovery.
“We believe that the challenges being faced by businesses can be surmounted through a judicial or administrative process which is supported by law to enhance effective business recovery,” he noted.
Revealing some early signs that point to a business going into distress, he said these include delayed payment of salaries and obligations, performance challenges in terms of contractual obligations, and managing overheads. “Also, changes in policies and laws can result in insolvency for some, and the moment a business owner begins to notice these signs, it is important that effective experts are engaged to begin the rescue process.”
Touching on how the newly signed tax reforms would affect insolvency practice, he said practitioners, under CAMA 2020, have the power to engage any professional who would assist in achieving business recovery processes.
Expressing worry over the multitude of challenges hobbling businesses in the country, he said these have led to massive business failure, adding that those showing signs of stability must be sustained. “We do not want to come in when the business has failed; the moment you notice the early signs, engage experts who can provide support.
One failed business has a multiplier effect on the economy, and it is important we save as many businesses as possible,” he said.
He further revealed that the association’s upcoming conference, holding on 25–26 September, will tackle, amongst other things, ways to handle financial challenges in businesses. “We have assembled a huge and experienced faculty to do justice to the theme, and we will release papers in key areas of insolvency that will guide our operations,” he said.
