Director's Penalties Submission
The IPA is committed to continual improvement of the insolvency framework and believes that reforms to the insolvent trading provisions and consequent liabilities of directors is vital.
The paper addresses a range of new ideas on insolvent trading in the context of allowing some latitude to directors to seek assistance in facilitating a restructuring of their business. We introduce a number of novel concepts including:
- a 'financial judgment rule', related to the 'business judgment rule' in s 180 Corporations Act
- coupled with an increased emphasis on the requirement to maintain appropriate books and records
Click here to download the submission.
The paper was prepared by Kim Arnold, IPA Technical Director and Michael Murray, IPA Legal Director in response to an invitation from Treasury with input from the IPA Board.