Business solvency – salvaging what you can: WA 'Dealing with a Client in Financial Distress' day

Clients can find themselves in financial distress for a wide range of reasons. And that financial distress can translate to real anxiety.

Clients often ignore the warning signs, which can lead to a situation that's much more difficult to emerge from. It's at this stage that an adviser is most likely asked to assist.

That said, the hallmark of a trusted professional is the ability to provide prudent advice when clients need it the most.

At the Dealing with a Client in Financial Distress event in Perth, a number of high-profile tax and legal specialists will be joined by representatives of the ATO to look at the causes and effects of financial distress, and the options available for businesses and individuals facing financial difficulties.

Dudley Elliot CTA

Dudley Elliott CTA, from Trove Advisory Group, has told us a little about what to expect from his session: 'Business solvency – salvaging what you can - tax and accounting considerations'.

“Usually, the last things on the mind of a business owner facing serious financial difficulty are accounting and tax issues. But ignoring them only makes things worse down the track. And when there are possible solvency issues, there are ways you can reduce risk and maximise what can be saved for your client.”

Dudley’s session will focus on the tax issues and the balance sheet. He will outline the issues to consider earlier rather than later in order to reduce your client’s exposure and to save what you can.

“I’ll relate my experiences with respect to failing businesses and structuring considerations when setting up, and the important planning steps you can take to protect what you can when business survival is a real issue.”

Looking at issues such as loan accounts (to and from your client and between entities), Division 7A considerations, and your client’s tax position with respect to losses (revenue & capital), Dudley’s session will also cover personal use assets and commercial debt forgiveness.

Dudley told us: “I expect that the issues mentioned will raise warning bells for those accountants advising clients with possible solvency issues. From that they can apply the concepts to reduce risk and increase what can be saved for their clients. I’m hoping the experiences I impart will be of use to advisers facing similar situations with their clients. I’m also looking forward to hearing from the other presenters – after all, in an area as complex and fraught as this, you don’t know what you don’t know!”

A one-time banker, Dudley moved on to commence a Chartered Accounting career with Nelson Wheeler (which later became part of the BDO group). Combining a Graduate Diploma in Financial Planning and a Masters in Taxation with his banking and accounting experience has given Dudley a unique set of skills that he can apply to most problems.

Dudley joined Deloitte in 1994, working with the Deloitte partnership from 1999 through to his departure in 2007. For the following 10 years, he was a partner in the Indian Ocean Group in Subiaco. In June this year he formed a new group, Trove Advisory, based in West Perth.

A regular presenter at Institute events, Dudley recently found himself “begging forgiveness from the wife for being offline for four weeks writing another paper and doing another presentation for The Tax Institute”.

Joining Dudley on the program will be Kim Wallman and Greg Quin (HLB Mann Judd Insolvency WA) with their session, ‘Director Penalty Notices and personal liability for directors in a liquidation scenario’, and Craig Pitt (Australian Taxation Office, Debt – Early Intervention Service Delivery) who will present ‘The ATO and debt relief provisions’. Other sessions will cover bankruptcy, asset protection and superannuation issues.

The Dealing with a Client in Financial Distress day took place on 22 February 2018 at City West, Perth. You can view the papers from the event on our website.


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