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Demise of ESC16 - any reasonably priced IPs out there ?

Demise of ESC16 - any reasonably priced IPs out...

We have to look for an insolvency practitioner, one who hopefully charges pitifully reasonable rates, to deal with a members' voluntary liquidation where the assets comfortably exceed £25k. 

He or she would be presented with a company which has all creditors paid, debts collected, etc., so just a bank balance of maybe £1/4 mil, some stock & plant (which the directors will purchase, so nothing to sell) and presumably a final VAT return to encompass the liquidation fees etc.

Any suggestions welcome !

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31st Mar 2012 09:20

Try these...

There will be lots of IPs looking to get into this new strand of business so prices likely to be reasonable. To be honest with £0.25M in the bank, a few thou is nothing.

Depending on where you are (best you say) try the firm I've started to deal with Jeremy Frost @ The Frost Group, Croydon.

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31st Mar 2012 10:44

e-mail me and I'll give you a v good firm (just finished one for me v successfully for £4000)

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31st Mar 2012 13:50

£750 plus

I've just this morning had a letter from Redman Nichols Butler in York offering Members' Voluntary Liquidations from £750 plus disbursements. Funny because I was only saying to a client yesterday that the ESC C16 enactment would bring down the price of MVLs' for smaller firms!

They can be contacted on 01377 257788. I have no connection with them They write to me because I met someone from the firm once at a networking function so I cannot tell you how good they are. Although they did send me some chocolate mini eggs with the letter so I might be suggesting them because they have bribed me!!.

Cathy

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02nd Apr 2012 08:50

"From"

"From"

I doubt that £750 is the normal  price when considering the clearances they have to obtain and the no of letters required. This is so far below the normal market price as to cause a mmmmmH????

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By Jimess
02nd Apr 2012 09:37

I would also recommend...

I would also recommend Redman Nicholls Butler.  I have just asked them to meet up with one of my clients and was impressed with their approach.  They were fairly simple situations and the suggested fees for my clients were around the £2k mark but with the usual caveats relating to additional work. 

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Red Kite
02nd Apr 2012 11:09

MVLs

Many thanks, everyone, particularly Cathy and Jimess.

Spoke to Andrew Nicholls of RNB this morning and he seems pretty clued up (ex Coopers & Lybrand) and can do the business for a reasonable sum, given that he's passed the company with everything already done and he just has to place the adverts, hold the EGM, and distribute the cash to shareholders.

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02nd Apr 2012 15:47

Quote from an IP MVL's.

Just been quoting on this to established accountancy contacts so good timing.

For a 'straightforward' case we should be able to achieve costs of £2000-£2500 + VAT and disbursements (major being Specific Bond - rates depending on asset levels)

The more complex the higher the cost but we are aiming at being very competitive in this market.

For more specific quotes please email or call 01204 663000

http://www.idealcs.co.uk

 

 

 

 

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03rd Apr 2012 12:29

What does "Reasonable" Mean?

If 'reasonable' means cheapest, then get Del and Rodney Trotter to do it.

If 'reasonable' means good value-for-money, then what's the value of the work?

That's actually fairly simple to answer.  What difference will it make to have an IP do the work properly, to produce a robust result, within acceptable and achievable timescales?  If that's hard to answer, consider the alternative.  What will be the cost of nobody doing anything about it, ever?

When you have established the value, or even better got your ultimate client to establish the value, you have the ability to judge the IP's fee against that value and to determine whether their fee represents value for money.

David Winch

Make Sales Without Selling and Get Paid What You're Worth

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By KH
03rd Apr 2012 14:23

Reasonable cost .... now there's the rub

The above comment from David Winch about what does reasonable mean rather bypasses the issue, in my opinion. Let's face it, you can get your personal tax return done by one of the big boys and pay well in excess of £1200, even for the simplest return. Whereas other practitioners, equally capable, might just charge £75 to £300 for an identical piece of work. So I think the question about IP value for money still stands, and robustly, too. It's not the value which we as individuals might put on it which is the sole yardstick for price .... if it were, what price a medical subscription? We're talking free economy here (OK, take "free" with a pinch of salt, but I think you get my drift).

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03rd Apr 2012 15:18

I don't follow your drift KH

How do I 'bypass' the issue?  The OP asked for suggestions of an IP who charged 'reasonable rates'.  I was merely raising the question of how to define reasonable, to assist those who actually know an IP they might think of suggesting.  Maybe I should have also asked how to define 'pitifully' although I'm not sure about the juxtaposition of the two terms in the same sentence.

If the range of prices for an identical piece of work, delivered identically, with identical lifetime service, ranges from £75 to over £1,200 then, provided that you judge 'lifetime' to be a considerable number of years in all cases, why not take the £75 option.

Then you say that you agree with me that value for money is what counts.  However, I contend that the individual is precisely the right person to be assessing value, at least the individual end-user.

Value is undeniably in the eye of the beholder, therefore it is only the individual who can say what difference the work will make or what the cost will be of never having the work done will be.

A medical subscription is sold as a commodity.  Sure the detail may change from company to company, and there will be several packages available form any one of them.  But these insurance companies are in the business of sharing the risk, and therefore charge the same price for the same level of cover rather than the same 'outcome', even though, like every other insurer they charge more for those perceived to be more likely to claim.

Where the ability exists to articulate value before work starts and to charge different prices for different value, I see it as a function of the 'free economy' to do so.

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03rd Apr 2012 19:24

Reasonable rates

Thanks for the further comments, everyone, particularly KH who I think can see what I'm getting at. Your figure, Andrew, is (commendably) at the lower end of what we've been quoted, but nevertheless I do have a bit of an issue with it. 

My point really is that the IP is going to be handed a bank a/c, out of which he pays his own fee and returns the rest to the shareholders. So maybe he has to write out 3 cheques. On top of this, he has to arrange a bordereau, fill in and submit, what, half a dozen statutory notice forms and send them off to the Gazette, a local paper and Companies House ?  And I imagine that nowadays there's software that prints out all the notices etc. ?  Ok, I suppose he has also to arrange payment of these adverts but not bear their cost which is added to the fees as disbursements, and then possibly spend half an hour having the EGM in his office and (probably these days) do due diligence to ensure the shareholders aren't drug dealers.

So unless I'm missing an awful lot of stuff, why is this £2000 to 4000 ?  Yes, no doubt there are standing charges but then we all have these, even the guy doing the perfectly adequate tax return for £75 instead of the £1200 charged by the big boys.

Whilst I have no desire to see my fellow accountants being reduced to eking out an existence at subsistence level, I do not really see that excessive fees are justifiable. But perhaps IPs can tell us there's a lot more work to an MVL than meets the eye ?

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By cfield
04th Apr 2012 00:21

It's the license (and the knowledge) that you're paying for

Not everyone can be an insolvency practitioner. You need a license, and getting that license means you have to:

a) pass exams set by the Joint Insolvency Examination Board; and

b) have the necessary practical experience

Therefore, you are paying for the license in a regulated industry and also for the knowledge and experience of the practitioner, not for the length of time he/she works or the content of that work.

Unlike us, they do not have to compete with every Tom, Dick and Harry who fancies being an accountant and has a slick website, quotes cut-price fees, has no PII or CPD to keep up and no real scrutiny or control of their work by the authorities or professional bodies to worry about.

I recently had an IP sniffing around me for work and I asked her to quote for what would have been a straightforward DS01 case. She quoted £5,000. I was incensed. I told her I would never allow any of my clients to be fleeced like that and not to expect any business from me.

£2,000 sounds much more realistic, and to be frank, if you are in a licensed industry and worked hard to get where you are, you should be able to charge more than a few hundred quid for your time and expertise. It's just a shame we can't charge decent fees any more, at least not for compliance work.

I'm just glad that some IPs are treating it as an opportunity to rake in easy work by quoting lower fees rather than as an excuse to fleece people who now have no realistic choice but to use their expensive services, thanks to the expedient and craven attitude of HMRC and the Treasury, and the dubious political process by which this £25,000 rule has become law without even being voted on in Parliament (not that it would have done much good if it had).

 

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04th Apr 2012 08:03

Lower ... lower!

I can promise that £2,000 will seem high in a few months time. Forget (the entirely valid) arguments put forward by Cfield as I suspect the market will decide. A few switched on, savvy practices will see the opportunity to mop up the market with a slick website and the base price will be ..... £995 + VAT for a cash only liquidation. Do a 1,000 of these in a year and investing in some slick systems will seem a no brainer. Of course, if a simple one costs £995 then people will start to question £4,000 - £5,000 for a slightly more complicated scenario and the prices for that will tumble also to perhaps half there current level.

 

What seemed like a great time to be an IP, I think will turn out to be somewhat different for most of them.

 

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By Maslins
Euan MacLennan
15th Jun 2012 16:53

I think Steve's right

Steve Holloway wrote:
I can promise that £2,000 will seem high in a few months time. Forget (the entirely valid) arguments put forward by Cfield as I suspect the market will decide. A few switched on, savvy practices will see the opportunity to mop up the market with a slick website and the base price will be ..... £995 + VAT for a cash only liquidation. Do a 1,000 of these in a year and investing in some slick systems will seem a no brainer. Of course, if a simple one costs £995 then people will start to question £4,000 - £5,000 for a slightly more complicated scenario and the prices for that will tumble also to perhaps half there current level.

What seemed like a great time to be an IP, I think will turn out to be somewhat different for most of them.

I'm partly behind a new company offering exactly that - MVL Online.  Possibly others will follow suit, though I don't anticipate the market to be _that_ big.  NB disbursements for statutory liquidations are significant, these are payable on top...several hundred pounds in disbursements sounds a lot more significant when the fee is sub £1k than when it's ~£5k.

There will of course still be a place for expert insolvency practitioners, this is simply to meet the specific demand post ESC C16 for simple cash only members voluntary liquidations.

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By pacioli
04th Apr 2012 09:18

ISPs have different responsibilities, not just to clients!

Funny - I received a slick email from a company called Arrans last week about ESC C16 issue. They advertise that  'Our costs for carrying out a Members’ Voluntary Liquidation, where the funds are distributed immediately, start at £2,500 plus disbursements (at cost).'  I suppose  No doubt I shall be receiving more of these  I guess I'll be receiving more of this type of advertisement from other ISP's. At the end of the day you have to be careful about who you engage on behalf of a client - previous experience of an ISP is the key. Time will tell as to who is reliable and reasonable based on past experience. I am not sure whether to take a  'quote' from an ISP  as a 'near enough' certainty!

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04th Apr 2012 10:00

.

@Steve, this is a "cheap is best" market place. All clients will want who would have otherwise have just had the company struck off is liquidation at the lowest cost. There is no skill or benefit to be gained at this point in the marketplace, its just form filling. Prices should fall if the IP's get their act together and automate everything which probably doest matter right now with the chunky fees. 

As Steve says, someone will break ranks and do it. You can see it already with £3k down to £2k.

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By KH
04th Apr 2012 16:39

Clarification of my previous posting

hi, just had a root canal done, so probably not the best time to clarify, or should I say attempt to clarify, what I posted yesterday

I'm not saying cheapest is best, and I'm not saying that a Merc should cost the same as a motorised wheelbarrow, but I do think that there are some hugely inflated prices around for what are basically simple jobs ... viz. my comment about the same quality of work on a simple tax return costing anything between £75 and £1200 plus.

And I'm not against people earning a good living, but fleecing people is something which gets my goat. And yes, I don't know if anyone's being fleeced, but if the costs for a simple tax return have such a huge range, then if I were being quoted £1200 I'd go elsewhere .... and the original poster was merely asking for recommendations of IPs who were charging reasonable rates ... a very good question, as it turns out.

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