Company Voluntary Arrangement

A Company Voluntary Arrangement (CVA) is a legally binding agreement between the company and its creditors that enables the company to freeze all unsecured debts and repay them over a period of time from the future trading profits of the company.

A CVA can even write off significant levels of debt. We will assist you to prepare a proposal that will be sent to your creditors for them to consider. Commonly, the CVA proposal is based on monthly contributions from future trading and repayments are based on the amount the business can reasonably afford.

You will remain in charge of the company and DCA Business Recovery will oversee the recovery process as Supervisor of the arrangement; we will not be involved in the day to day running of the company, as you know how your business works better than we do.

However it is important that the CVA should not be used to simply write off previous debts and continue trading the company in the previous manner. DCA Business Recovery can assist in supporting you through the process and identify the key factors needed for future success whilst in the CVA and thereafter.

Frequently Asked Questions

Due to the amount of work required to prepare a proposal to be sent to creditors we advise that a period of 4-6 weeks from initial meeting to providing the final proposal to creditors.

We will prepare the proposal based on information provided by directors and their accountants. A cashflow forecast will be required to enable us to consider affordable monthly payments into the arrangement.

No. A CVA will normally require the company to remain trading and therefore the assets will be needed to ensure trade continues and contributions can be made.

In order for the CVA to be accepted it will require 75% (in debt value) of your creditors voting on the proposal to agree the terms.

Also 50% or more of the shareholders will need to agree the proposals.

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If the proposal is accepted by 75% (in debt value) of creditors voting on the proposal, then the arrangement is accepted and as such all creditors are bound by its terms.

Creditors can put forward modifications to the proposal when voting, but the directors will need to agree to any modifications. This will also be dependent on the value of the vote the creditor has.

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