Small Business Restructure Case Study: $800,000 Debt Resolution Success
The Initial Engagement
The engagement began through a referral from a bookkeeper who had a client facing significant stress and confusion. The client operated five businesses under one company structure. Two major businesses were lost due to flooding. During the relocation and rebuilding process, the client was defrauded by a builder. At the time of seeking help, the client faced approximately $800,000 in debt.
I cannot speak more highly or more warmly of Neil Mitchell from B & T Advisory.
I was referred to Neil during an extremely difficult time in my life, with my business having just suffered complete decimation from flooding and shortly after a significant theft from a builder.
I was distraught, lost and felt my situation was completely hopeless. I was fortunate, however, to have an excellent bookkeeper who referred me to Neil and suggested that he may be able to find me a solution.
Business Structure Issues
The original setup with five businesses under one company created significant complications. Legal coordination was required to transfer leases and properly assign rental agreements. Bookkeeping records required considerable attention due to direct changes made to accounting files.
Our Collaborative Approach
The restructure involved coordination between:
- The client
- Referring bookkeeper
- Accountant
- Lawyer
- Restructuring specialist
All parties worked together to develop a clear plan and restructure the businesses into appropriate separate entities. This case required coordinated effort from multiple professional advisors working together. The trusted advisor relationship between the restructuring specialist and the referring bookkeeper was crucial to achieving a successful outcome and significant debt relief.
Within minutes of speaking to Neil I felt a sense of hope that I hadn’t felt in a long time. Not only was Neil kind, empathetic and sensitive given my distressed state – he was also solution-focussed and clearly very experienced in restructuring matters, which was incredibly reassuring.
Shortly after our first phone call, Neil organised meetings with my accountant, bookkeeper and lawyer to ensure my business matters were up to date and everything was positioned correctly and appropriately for the ATO submission.
Small Business Restructure Outcome
The $800,000 debt was resolved through the Small Business Restructure process for approximately 30 cents on the dollar. The businesses were successfully separated and repositioned for sustainable operation.
Words cannot express to you the relief, happiness and gratitude I felt when Neil called me to give me the good news that our restructure had been approved. It was the first time something had gone right in such a long time, made possible only through Neil’s expertise and guidance.
Business Restructure Success Factors
Trusted Referrer Relationship: Strong working relationship with the referring bookkeeper enabled open communication and unified advice to the client.
Clear Communication: Complex concepts were explained in simple terms, and understanding was confirmed before proceeding. Questions were encouraged and addressed patiently.
Collaborative Planning: Getting all professional advisors aligned and working toward the same objectives streamlined the process.
If you are facing a difficult period or hardships in your business and you have no idea what to do or who to turn to – Neil would be an excellent start. A simple conversation turned into one of the best things I could have ever done for my business and I am eternally grateful to Neil for holding my hand through the process.
Business Insolvency Warning Signs for Advisors
- Clients injecting personal money into the company instead of extracting profits
- Rising Australian Taxation Office debt
- Unpaid superannuation obligations
- Creditors remaining unpaid beyond 60-90 days (depending on industry norms)
- Debtor amounts aging beyond 60-90 days
- Increasing overdue amounts across multiple categories
Talk to us today about how Small Business Restructure can help.