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Charity: Backpacks 4 SA Kids

We are delighted to announce NCI’s Group Service, Risk & Compliance Manager, Jeff George, as an Ambassador for “Backpacks 4 SA Kids” in their upcoming Charity TV Project.

Jeff has been a valued employee of NCI for 27 years and we at NCI are conscious of our corporate and social responsibility within the community. We are happy to support Jeff’s work with a charity that comforts and supports children that are displaced from their home and at their most vulnerable.

Jeff is in the midst of a fundraising campaign and is planning a corporate lunch at Adelaide Oval on 19 September. He is also on the lookout for sponsors to promote during his upcoming TV adventure.

Please contact Jeff if you want to find out more or visit this link.

 

Illegal Phoenix Activity

A recent study by PwC suggests illegal phoenix activity is costing Australia between $2.85 billion and $5.13 billion a year.

While there are many failed businesses that manage a legitimate rebirth of sorts following a liquidation process in which creditors and employees are treated fairly, there are others where assets are gradually siphoned off and liquidation is used as a way of avoiding obligations to creditors and employees while the business carries on under a new guise.

Unfortunately, there appears to be a growing trend of professional intermediaries actively promoting and facilitating illegal phoenix behaviour – advising business owners how best to transfer assets from one corporate entity to another in order to avoid paying entitlements and honouring their liabilities.

While the Federal Government last month announced a ‘Phoenix Hotline’ (1800 807 875) in an attempt to combat the activity of dishonest directors, it is difficult to reconcile this with recent reforms aimed at reducing the vulnerability of directors to claims of insolvent trading and dramatically cutting back the length of time a director need be considered ‘bankrupt’.

NCI and its partner, Results Legal, are currently putting on presentations around the country on this subject.

A WORD FROM THE MANAGING DIRECTOR: KIRK CHEESMAN

It’s exciting to think that we’re already a month into the new financial year! During July we held our Annual Broker Conference in Sydney, this coincided with our Underwriter of the Year Awards which celebrated some fantastic achievements in our industry. It was a great time to reflect on the previous year while looking ahead to 2018/19.

We have now released our second instalment of Credential, this updated version gives more control to the user when approving, denying or amending credit limits. Based on feedback received, we think Credential Console will be a welcome upgrade for existing and potential users who are looking to streamline their credit application process.

Next week will see the last of our joint breakfast seminars with Results Legal. This year we’ve been looking at Phoenix Activity in addition to the new Insolvency Law Reforms. You can download a summary of the reforms here.

If you would like any more information on the above, please let us know.

Kind regards

Kirk

ASIC: Company register update – March 2018 to June 2018

ASIC has released information on company registrations from March – June 2018.

Here’s a brief update on the company register between 1 March 2018 to 30 June 2018:

There were 90,101 company registrations and 41,170 company deregistrations in Australia.

At the end of June, the total number of companies on the register was over 2.6 million, compared with over 2.5 million at the same time last year.

There were fewer registrations in the past four months when compared with the same period last year of 96,423.

The table below details how many companies were registered in each state between March 2018 and June 2018:

 State

 Number of companies registered

 New South Wales

 31,851

 Victoria

 27,934

 Australian Capital Territory

 1,624

 Queensland

 16,270

 South Australia

 4,143

 Western Australia

 7,145

 Northern Territory

 306

 Tasmania

 828

Yet another food business in trouble.

After the news in July that Sumo Salad were in the hands of external administrators we wouldn’t have thought that, less than 2-weeks later Zumbo Patisserie would follow.

With stores scattered across New South Wales and Victoria, the well-known brand has found themselves in a sticky situation. Early indications are creditors such as wholesalers among others may be left out of pocket as debts are said to potentially reach $10m.

No doubt this is another case where rising rents and high costs of labour are putting extreme pressures on restaurants / fast food providers across the country. This is compounded by times of high competition and a reduction in consumer spending.

We recently highlighted in our Trade Credit Risk Index that both Sumo Salad and the Jamie Oliver Restaurant Group (Australia) were notable business failures in Q2. This follows the demise of other food retailers such as Pie Face and Doughnut Time, further placing pressures on food distributors and wholesalers.

This development highlights to all businesses trading on credit that you can never be too careful and that the only peace of mind is a trade credit insurance policy.

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