Every business entity is usually at risk of becoming financially insolvent. Therefore, proper planning of the activities of any organization includes the development and application of methods to prevent bankruptcy of an enterprise if it possibly occurs.
Important! If you are considering your own case related to preventing the bankruptcy of an enterprise, then you should remember that:
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Extrapolation
Extrapolation creates a forecast for a short period of time when there are circumstances for bankruptcy to occur that are related to the activities of the enterprise, as well as the country’s economy in crisis. In current forecasting, the same parameters are used that were used in similar work for past periods.
Important!
The result of extrapolation is a certain statistical series used by the company to assess risks at each stage of its activities. The accuracy of the information depends on the economic situation in the country and the period of time being considered.
What is bankruptcy
Bankruptcy is the inability of a company to pay its obligations: pay salaries, severance pay, and settle accounts with counterparties.
In order for the arbitration court to make a decision on insolvency, the period of delay in payments must be at least three months, and the total amount of debt must be at least 300 thousand rubles. If during the proceedings the court finds that the business’s income cannot cover its debts, under bankruptcy law the company will have to sell the property and transfer the money to creditors. At the same time, fines are not assessed and seizures are lifted from the assets of the legal entity.
Modeling
The most common among economic forecasting methods is the modeling method. It makes it possible to recreate a certain situation and suggests a way to prevent it. Through analysis based on statistical information and mathematical modeling, all factors that can lead to bankruptcy of an organization are considered. Thanks to this, a large amount of information is processed regarding the social, economic and demographic state of the country.
Stages of bankruptcy of an organization
The procedure includes 5 stages, each of them has legal features.
- Observation. At this stage, a detailed analysis of all the affairs of the company is carried out, and the circumstances that caused bankruptcy are identified.
- Appointment of a manager. After the claim is accepted, independent specialists - managers - are involved in the case.
- External control. The manager optimizes all enterprise resources in order to discover hidden resources.
- Health improvement. If, during the analysis carried out at the initial stage of production, hidden opportunities are identified in the enterprise, then the court makes a decision on the appointment of a recovery procedure. This stage can last up to 2 years. The main goal is to restore the normal functioning of the organization. At this stage, management does not have the right to independently make decisions regarding the management of the enterprise; all actions must be coordinated with the manager. If there are no positive results, the court decides to complete the rehabilitation measures and begin bankruptcy proceedings.
- Bankruptcy proceedings, during which all the debtor’s property is sold, and the proceeds are used to pay off the resulting debt.
The bankruptcy procedure for an organization is extremely complex and always involves a number of difficulties. Therefore, consultation with a lawyer on bankruptcy of a legal entity is simply necessary for the successful completion of the case.
Sanitation
In Art. 31 of the Federal Law “On Bankruptcy” specifies the possibility of providing free financial support to the debtor. This measure is called reorganization; it is applied only if there are certain signs of bankruptcy and only in an amount that is sufficient to improve solvency. Financial recovery as an option to prevent bankruptcy can be carried out by unitary organizations that own the debtor’s assets, as well as participants, creditors and other persons to prevent bankruptcy and restore solvency.
Important!
Rehabilitation can be used at any stage of the bankruptcy case.
Article 132. Property of the debtor not included in the bankruptcy estate
1. If the debtor’s property includes property withdrawn from circulation, the bankruptcy trustee notifies the owner of the property withdrawn from circulation about this.
2. The owner of property withdrawn from circulation accepts this property from the bankruptcy trustee or assigns it to other persons no later than six months from the date of receipt of the notification from the bankruptcy trustee.
3. If the owner of property withdrawn from circulation fails to fulfill the obligation provided for in paragraph 2 of this article, after six months from the date of receipt of notification from the bankruptcy trustee, all expenses for the maintenance of property withdrawn from circulation shall be assigned to the owner of said property, unless otherwise established by this article.
4. Socially significant objects, objects of cultural heritage (historical and cultural monuments) of the peoples of the Russian Federation and other objects, the sale of which, in accordance with the legislation of the Russian Federation, must be carried out through bidding in the form of a competition, as well as objects in respect of which agreements have been concluded on state -private partnership, objects in respect of which municipal-private partnership agreements have been concluded are sold in the manner established by Article 110 of this Federal Law.
Mandatory conditions of the competition for the sale of these objects are the obligations of buyers to ensure proper maintenance and use of these objects in accordance with their intended purpose, as well as the fulfillment of other obligations established in accordance with the legislation of the Russian Federation.
The sale of an object of cultural heritage (historical and cultural monument) of the peoples of the Russian Federation is carried out in compliance with the requirements established by paragraph 4 of Article 110 of this Federal Law.
The purchase and sale agreement for an object of cultural heritage (historical and cultural monument) of the peoples of the Russian Federation must comply with the requirements for the purchase and sale agreement for objects of cultural heritage (historical and cultural monuments) of the peoples of the Russian Federation, established by the legislation of the Russian Federation on the privatization of state and municipal property.
In the case of the sale of municipal infrastructure facilities, the mandatory conditions of the competition also include the obligations of buyers to provide citizens, organizations operating social housing stock, as well as organizations financed from the budgets of the budget system of the Russian Federation, goods (work, services) at regulated prices ( tariffs) in accordance with the established premiums to prices (tariffs) and provide these consumers with benefits established by federal laws, laws of constituent entities of the Russian Federation, and regulatory legal acts of local governments, including benefits for payment for goods (work, services).
Paragraphs six through eight are no longer valid. — Federal Law of December 29, 2014 N 482-FZ.
4.1. If socially significant objects, objects of cultural heritage (historical and cultural monuments) of the peoples of the Russian Federation or objects of communal infrastructure were not sold in the manner established by paragraph 4 of this article, the further procedure for their sale is established by a meeting of creditors or a committee of creditors, including through new tenders, through a public offer in the manner established by Article 139 of this Federal Law, or an invitation to make offers within thirty days from the date of publication of the relevant message.
At the same time, bidders for the sale of the debtor’s property through a public offer, as well as persons who sent the offer, are required to undertake the obligation to conclude an agreement with local government bodies on the fulfillment of the conditions specified in paragraph 4 of this article.
4.2. After bidding for the sale of property in the form of a competition, through a public offer or receipt of acceptance of one of the received offers, the local government body enters into an agreement with the buyer of socially significant objects on the fulfillment of the conditions specified in paragraph 4 of this article.
In the event of a significant violation or failure by the buyer of socially significant objects to comply with the agreement on the fulfillment of the conditions specified in paragraph 4 of this article, this agreement and the contract of sale of socially significant objects are subject to termination by the court on the basis of an application from the local government body.
If the court terminates this agreement and the purchase and sale agreement for socially significant objects, such objects are subject to transfer to the ownership of the municipality, and the funds paid under the purchase and sale agreement for socially significant objects are reimbursed to the buyer from the local budget.
4.3. In the event of insolvency (bankruptcy) of a fund that has the status of an international fund in accordance with Federal Law of August 3, 2021 N 290-FZ “On International Companies and International Funds” (hereinafter referred to as the international fund), they are not included in its bankruptcy estate and are subject to transfer to the founder the shares and shares in the authorized capital of Russian and foreign legal entities contributed by him to the international fund, as well as securities certifying rights in relation to shares and shares in the authorized capital of Russian and foreign legal entities, subject to the simultaneous presence of the following conditions:
1) in relation to the shares, interests and securities specified in this paragraph, the charter of the international fund establishes a ban on their alienation by the international fund, information about which is included in the Unified Federal Register of Information on the Facts of the Activities of Legal Entities;
2) the charter of the international fund provides for the exercise by the international fund of powers, rights and obligations established by clauses 1 and 2 of part 1 of Article 12.4 of the Federal Law of August 3, 2018 N 290-FZ “On International Companies and International Funds”, and mandatory return to the founder in the event liquidation of the international fund of shares and shares of Russian and foreign legal entities contributed by it to the international fund, as well as securities certifying the rights to shares and shares in the authorized capital of Russian and foreign legal entities.
5. Socially significant objects that are not sold in the manner established by paragraphs 4 and 4.1 of this article are subject to transfer to the municipal ownership of the relevant municipal entity represented by local government bodies, of which the bankruptcy trustee notifies the specified bodies.
Housing stock for social use is subject to transfer to the owner of such housing stock.
6. The transfer of socially significant objects specified in paragraph 5 of this article and the housing stock for social use, respectively, into municipal ownership and to the owner of the housing stock for social use is carried out without any additional conditions on the basis of a ruling of the arbitration court within the time limits provided for by such a ruling.
7. Officials of state authorities and officials of local self-government bodies who do not comply with the provisions of paragraphs 5 and 6 of this article bear responsibility under federal law.
8 - 11. Lost power. — Federal Law of August 22, 2004 N 122-FZ.
Measures to prevent bankruptcy of an enterprise
In addition to the use of reorganization, which is allowed for organizations on the verge of financial insolvency, there are other measures. Ways to prevent bankruptcy of an enterprise, depending on the organizational and legal form and the totality of other circumstances, can be of a different nature, such as:
- providing financial support;
- concluding a compensation agreement, terminating obligations in other ways;
- collection of accounts receivable;
- sale of property;
- increase in capital due to additional contributions from participants or third parties;
- fulfillment by the owner of the property, as well as by 3 persons or participants of the obligations of the debtor;
- issue of shares;
- transactions that increase the creditworthiness of the enterprise;
- control of accounts payable;
- a competent approach to building a corporate structure;
- sale of the enterprise;
- other measures.
