Liquidation is the process by
which a company is brought to end and the assets and property of the company
are sold. Another term used for liquidation is winding-up of the company. It
can be said at the end of the life of a company. A liquidator is appointed to take control of
the company and collects its assets and pays its debts. When a company is
liquidated it is brought to an end, stops trading and ceases to exist. Any
assets and property of the company are redistributed to creditors.
There are three Modes of winding
up of a company, which are:- Member`s voluntary winding up
- Winding up subject to supervision of court.
- Creditor`s voluntary winding up
- Compulsory liquidation
In Member`s voluntary liquidation
the company`s director state that the company will be able to pay its debts
within 12 month from the start of liquidation and the declaration will include
a statement of company`s assets and properties.
Creditor`s voluntary liquidation process start when the owner of the
company state that company can`t continue in business because of liability. The
directors of the company should prepare a statement of all the topics which are
going to be consider at the meeting. In compulsory liquidation the court makes
a winding up order on the petition of an appropriate creditor or company.
If you want to know more about Canadian liquidation then Click Here
No comments:
Post a Comment