What impact does personal bankruptcy or other Insolvency proceedings have on individual’s credit rating?

02/06/2015 by Michael Jones

  As a bankruptcy trustee I am often asked by individuals facing personal financial hardship what will happen to my credit rating if I formally declare myself bankrupt More importantly individuals are often concerned about their ability in future to borrow money for important things such as a house or a car. The legal position is that the bankrupt is unable to borrow money over the prescribed limit (presently $5,409) without disclosing the fact that the individual is bankrupt. Clearly a lender will be cautious about making an advance in such circumstances. The position changes however once the individual is discharged from bankruptcy or even better if the bankruptcy is annulled.

Read More 0comments

Will the Australian government’s “single touch payroll proposal” create more insolvencies?

19/03/2015 by Michael Jones

The Australian government announced measures to cut red tape for business and to provide a simplified payroll system that would mandate or a “single touch payroll system” The Australian Taxation Office (ATO) is currently conducting a consultation process in order to examine the consequences of this measure and has called for submissions from stakeholders. Under “single touch payroll”, employers will be required to electronically report payroll and super information to the ATO (Australian Tax office) when employees are paid, using standard business reporting – enable software. This is different to the current situation where employee tax deducted from payroll is reported in the empl

Read More 0comments

Why is risk-taking and entrepreneurship important to the Australian economy?

10/12/2014 by Michael Jones

Risk is essential to the business environment. Entrepreneurship relies on creativity and imagination but with every new endeavour comes risk. The usual paradigm is that there is a direct relationship between the level of risk and return or profit attributed to that activity. The Jones Partners’ economic research project into small to medium business (SME) Insolvencies in the Australian economy looked at the impact of risk and risk-taking on entrepreneurship. The attached video excerpt tries to answer the question -why is risk-taking and entrepreneurship important to the Australian economy? And provides an interesting narrative commentary on this issue Most new ventures carry with

Read More 0comments

The effect of the environmental movement on Insolvencies in Australia

08/12/2014 by Michael Jones

There are three major contributors to Australian insolvency statistics Obviously the overall health of the Australian Economy is important and this was clearly demonstrated in the Jones Partners Report on Insolvencies in the Australian Economy launched in July 2014. In that report it was clearly demonstrated that there is an inverse relationship between the level of GDP and the number of Insolvencies. This was more pronounced with respect to Company Liquidations, Voluntary Administrations and Receiverships than with Personal Bankruptcies. It’s important however to realise that the management of individual businesses is more important. In fact the major reason for Australian compa

Read More 0comments

Is Small Medium Enterprises — the heartland of the Australian economy?

05/12/2014 by Michael Jones

It is clear that SMEs are the back bone of the Australian economy and at a recent function launching the Jones Partners Report into insolvency administrations in Australia Craig James, chief economist of the Commonwealth Bank said that 97% of Australian businesses employ less than 20 employees. It is therefore not surprising that over 80% of companies that fail are in this category. The businesses that dominate the corporate failure statistics roughly parallel the businesses in the SME sector and are very highly represented amongst construction, retail and professional services. The Jones Partners Report looked in some detail at the effect on the Australian economy of the failure of compa

Read More 0comments

President’s Award

06/12/2012 by Michael Jones

  Business Recovery Specialists Jones Partners Receives Prestigious President’s Award From Civil Contractors Federation of Australia (NSW) Branch On the 16th November, 2012 I received a coveted award from the Civil Contractors Federation of Australia (NSW) Branch.  The “President’s Award” was presented in recognition of Jones Partners’ commitment to educating and consulting with the Civil Contractors Federation and the industry in general.  Business recovery specialists, Jones Partners understand the trauma business owners suffer in the face of financial adversity. The award also signifies Jones Partners’ dedication to serving businesses facing difficulties due t

Read More 0comments

Ponzi Scheme

13/11/2012 by Michael Jones

Overview In the 1920’s an Italian emigrant in the United States by the name of Charles Ponzi perpetrated a number of frauds against fellow Italians emigrants in the Boston area in the United States of America. The frauds committed by Ponzi were many and various but his most successful schemes related to the genre that now bears his name. The essential element in the Ponzi scheme involves the offer and often payment of extremely high returns from doubtful sources in circumstances particularly where the investors who come into the scheme at the beginning are paid their investment returns using funds raised from investors who subsequently come into the scheme. Mr. Ponzi did not

Read More 0comments

Phoenix Fire Reignites

by Michael Jones

The Phoenix Fire Reignites Over recent years there has been growing concern about the increasing level of the so calledPhoenixactivity in relation to the use of the corporate entity.  The Australian Government has recently issued a discussion paper on the impact of this kind of activity and a number of recommendations have been foreshadowed.  It is important to note that the discussion paper distinguishes between what it refers to as fraudulent Phoenix activity which involves usually evasion of taxes and other liabilities such as employee entitlements through the deliberate systematic and sometimes cyclic liquidation of related corporate entities as opposed to the legitimate use of the co

Read More 0comments

The Insolvency Trap

08/11/2012 by Michael Jones

Why Company’s fail It is very clear from statistics produced by the ASIC that the vast majority of companies fail as a result of poor strategic management.  Other reasons provided by the ASIC include poor cash flow management, inappropriate books and records and trading losses.  However it can be argued that all of the above descriptions really mean the same thing that is poor management.  This is good news in a way in that it means it is not inevitable that businesses fail.  Businesses fail because of the lack of the management skills of the directors and these management skills can be improved if directors focus on the appropriate details. The Unthinkable For most small business o

Read More 0comments