Company Voluntary Arrangement

A Company Voluntary Arrangement (CVA) is a legally binding arrangement between a company and its creditors to repay them over a period of time.

A Company Voluntary Arrangement may have an element of debt deferral, i.e. creditors are paid over a longer period of time. A Company Voluntary Arrangement may also have an element of debt excuse, i.e. creditors are not paid back the full amount that is outstanding to them.

Either way the offer that is made to creditors by the company will be subject to a vote by creditors as to whether they wish to accept the proposal.

Probably the most important point is that the company continues to trade and the Company Directors remain in control of the company.

A CVA won’t suit all business structures but, why not have a chat with us to see if it’s an option for your Company.

Key Benefits

• Enables the company to continue in business with a view to improving the position of the creditors
• Stops court action and winding up procedures
• Eases cash flow pressures
• Directors are allowed to remain
• Greater flexibility allowed ensuring that the return to creditors is maximised
• If a company has a viable future, but current cash flow problems have resulted in mounting pressure, a CVA may be a good solution.

Company Voluntary Arrangement FAQs

What is the financial structure?
Typically a monthly contribution is made into the CVA, which is distributed to creditors.

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Company Voluntary Arrangement – Key Facts

A CVA provides a realistic alternative to company closure or an insolvent company. A CVA gives Directors the opportunity to trade through a difficult period by deferring payments to creditors.

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