Choosing the right Insolvency Practitioner can have a significant bearing on the outcome for your company and your position as a director. This checklist covers the practical factors that matter most, from sector experience and credentials to questions that are worth asking before appointing an Insolvency Practitioner.
Why the choice of Insolvency Practitioner matters
While every licensed practitioner must meet the same standards set by the regulatory bodies, IPA (Insolvency Practitioners Association), ICAEW (Institute of Chartered Accountants in England and Wales), and ICAS (Institute of Chartered Accountants in Scotland), practical experience, sector knowledge, and working style may vary considerably. Consider this when choosing an Insolvency Practitioner to handle the rescue or closure of your business.
An Insolvency Practitioner’s role varies from procedure to procedure; however, this generally includes:
- communicating with creditors on your behalf
- making decisions about your company’s assets
- taking on a legal duty to creditors
- advising on the range of options available and the timing of any action
This guide covers the factors that help in identifying the right practitioner for your situation. As a starting point, check if they are licensed to offer insolvency advice. If you are unsure about the difference between a licensed Insolvency Practitioner and an unregulated insolvency adviser, our separate guide covers this in detail.
Start with the right type of practitioner for your situation
Most licensed Insolvency Practitioners offer a range of services, but the size and complexity of the business may determine who is the best fit. A veteran restructuring specialist with relevant sector expertise may be best placed to handle a group-wide restructuring involving multiple sites, while an SME insolvency adviser may be more suited to handle a straightforward Members’ Voluntary Liquidation (MVL).
Insolvency Practitioners working predominantly with SMEs understand the pressures that owner-managed businesses face, including personal guarantees, HMRC arrears, and personal liability risks. Those working primarily on larger restructuring assignments will have experience managing complex creditor groups, multi-site operations, and formal court processes at a greater scale.
Is sector experience important when appointing an Insolvency Practitioner?
Sector experience is one of the most significant factors when choosing an Insolvency Practitioner. An Insolvency Practitioner with extensive experience in your sector understands specific creditors, contracts, assets, and obligations that shape your options in ways that a general Insolvency Practitioner may not.
For example, an Insolvency Practitioner handling a construction insolvency must understand how obligations, such as the treatment of retentions, subcontractor claims, and performance bonds, interact with insolvency legislation. In retail, knowledge of commercial leases, stock valuations, and consumer obligations may be relevant to insolvency advice and the timing of any action. In hospitality, the interplay between landlord relationships, licensing obligations, and supplier terms can create complexities that a practitioner unfamiliar with the sector may not anticipate.
Questions worth asking before appointing an Insolvency Practitioner
The initial consultation is your opportunity to assess whether an Insolvency Practitioner is the right fit. Most offer a free consultation, during which you should ask the following questions:
- Am I speaking with a licensed Insolvency Practitioner, or a lead generation firm representing an insolvency practice?
- Are you licensed to give insolvency advice? You can verify an individual’s license through the relevant professional body
- Which options are available to my business and what are the short-term and long-term advantages?
- What experience do you have with businesses in my sector?
- How do your fees work and are there any additional or hidden costs?
When speaking with an Insolvency Practitioner about their sector expertise, ask about the outcomes and any sector-specific challenges encountered.
Warning signs to watch for when choosing an Insolvency Practitioner
Most Insolvency Practitioners operate professionally and in accordance with regulatory obligations. However, there are warning signs that a business should be aware of when choosing an Insolvency Practitioner.
- Unable to provide license details, including an Insolvency Practitioner number
- Unable to provide a cost estimate or confirm how costs are structured
- Claims to offer protection against consequences of director misconduct, including bounce back loan abuse
- Provides guarantees about specific outcomes without a thorough assessment
The Insolvency Practitioner should advise on a reasonable timeline during which action must be taken to maximise the range of options available.
“A good practitioner will ask as many questions as you do. They need to understand your business before they can give you meaningful advice, and that curiosity is exactly what you should be looking for.”
Dave Broadbent, Licensed Insolvency Practitioner
The importance of acting at the right time
Businesses that seek advice early, before a formal procedure becomes inevitable, typically have more routes available and more control over how the process unfolds.
Once creditor pressure begins to build, including county court judgments, winding up petitions, or HMRC enforcement action, such as the use of debt collection agencies, the window for pre-insolvency intervention narrows. For pre-insolvency advisory and company rescue and turnaround efforts to secure a positive outcome, the business must retain sufficient financial headroom. Contacting an Insolvency Practitioner at the first sign of serious financial difficulty, rather than as a last resort, secures the best chances for the business.
Using a directory to find the right match
A directory of licensed Insolvency Practitioners allows you to search by location, sector specialism, and service type, making it easier to identify practitioners whose experience matches your business.
Our directory covers licensed Insolvency Practitioners across England and Wales. You can search by postcode or location to find practitioners in your area, review their professional background and areas of specialism, and make contact directly for a free, confidential consultation.
