GT Advisory & Consulting work with businesses across all stages of the business cycle by developing solutions to drive business turnaround, refocus strategic direction and fine tune business performance.
Drawing on our in-depth industry expertise, we develop strategies which assist businesses navigate a diverse range of commercial challenges, by:
- developing in-depth restructuring and turnaround plans for businesses facing financial uncertainty;
- implementing performance improvement strategies to optimise business profitability and efficiency; and
- where necessary, assist businesses through the corporate insolvency processes such as voluntary administration and liquidation.
BUSINESS RESTRUCTURING
Our restructuring strategies are designed to equip directors and management teams with the information they need to make informed business decisions which maximise value for stakeholders and give businesses their best chance of survival.
Through our proactive and hands-on approach, we:
- Work with management to explore potential turnaround and business improvement strategies;
- Consider the organisation’s strategic business units, key products and services, key staff, suppliers and customers and explore possible divestment and wind-down strategies;
- Provide advice to assist management execute value-maximising restructures; and
- Where necessary, assist management prepare the business for a formal insolvency procedure which may involve implementing mechanisms to minimise disruption to the operations of the business.
Operating within the confines of a strict legal and regulatory framework, we provide decision makers with carefully considered advice so that strategies can be executed with confidence.
BUSINESS TURNAROUND AND PERFORMANCE IMPROVEMENT
We work with underperforming businesses and businesses facing financial distress to formulate turnaround and business improvement strategies which are designed to refocus the business’ strategic direction on revenue maximising activities, and return businesses to profitability.
As an agile advisory firm, we are able to assist management by:
- Assessing the business’ financial position and identifying the levers and key drivers of financial performance;
- Developing liquidity forecasts and advising on cash flow improvement strategies;
- Conducting customer segmentation and profitability analysis; and
- Developing strategies to maximise revenue, streamline processes and optimise the cost structure of the business.
We take the time to properly understand the business and provide management with the necessary tools to drive financial turnaround and restore business value.
INSOLVENCY
GT Advisory & Consulting also specialises in insolvency and business recovery, including assisting companies with the corporate insolvency processes such as voluntary administration and liquidation, and helping individuals with the personal insolvency process, which can include applying for bankruptcy or facilitating a formal offer to creditors through a personal insolvency agreement.
Insolvency is a complex area of accounting where an understanding of effective strategies is essential for achieving the best outcomes. At GT Advisory & Consulting, we have the specialist expertise that is required when dealing with distressed assets, individuals and businesses. We deliver commercial and innovative solutions on each engagement, working with all stakeholders to clearly understand objectives and to implement a strategy that will maximise returns and achieve the best possible outcome for all parties.
INCREASING THE OPTIONS
Early intervention is always key. Businesses facing challenging operating conditions should seek prompt, specialist advice to reduce the risks and consequences of financial failure and increase the options available to the business.
For any specific or general queries regarding your business, or to discuss the restructuring options available, please get in touch with one of our qualified and experienced experts.
Temporary Insolvent Trading Moratorium Update
/in Insights /by Christine SteadTemporary Insolvent Trading Moratorium Update
Earlier this year, the Australian Government introduced the Coronavirus Economic Response Package Omnibus Act 2020 (Cth) which was designed to provide temporary relief to businesses and stimulate economic activity. As touched on in our earlier article, this bill included a temporary COVID-19 safe harbour defence for directors from insolvent trading liability where ordinarily a director of a company in liquidation can be held personally liable for debts incurred when they should have suspected their company was insolvent.
Whilst the legislation has ultimately achieved its intended purpose, the Australian Restructuring Insolvency & Turnaround Association (ARITA), the professional body for insolvency practitioners, last month raised awareness to its members about the limitation of the defence.
ARITA outlined the specific amendment to the Corporations Act 2001 that provides temporary relief for insolvent trading as noted below:
“588GAAA Safe harbour—temporary relief in response to the coronavirus
Essentially, the relief measures may only apply if the company enters voluntary administration or liquidation prior to the expiry of the temporary measures, which is currently 31 December 2020. If an appointment is not made prior to this expiry a director may not be protected by the moratorium and is exposed to the insolvent trading provisions.
The new defence will be subject to the interpretation of the courts but could also yet be updated or clarified by the Government under the recently announced insolvency reforms to introduce a simplified restructuring process. The Government have acknowledged there will be transitional issues between the moratorium ending and the new reforms commencing and have indicated a business will be able to declare its intention to access the simplified restructuring process. Following the declaration an extension to the temporary insolvency relief would then apply for a maximum period of 3 months.
What does this mean if you are wanting to take advantage of the reforms? If your business is facing challenging operating conditions you should seek prompt, specialist advice to reduce the risks and consequences of financial failure and increase the options available.
For any specific or general queries regarding your business, or to discuss the availability of the defence, please get in touch with one of our qualified and experienced experts.
Latest News & Insights
Temporary Insolvent Trading Moratorium Update
Directors seeking to rely on the temporary relief from insolvent trading may only be able to do so if the company enters voluntary administration or liquidation prior to 31 December 2020.
Understanding Goodwill
When determining the Goodwill of a business, it is important to understand the characteristics of the business and the different types of Goodwill that may exist.
Understanding Goodwill
/in Insights /by James CookUnderstanding Goodwill
As noted in our previous article, when undertaking a business valuation, valuers are guided by common market practice and the valuation methodologies recommended in the ASIC Regulatory Guide 111.
When adopting the Capitalisation of Earnings Methodology, it is not uncommon for the calculation to deviate from the business’ net operational business assets. In circumstances where the value calculated under the Capitalisation of Earnings Methodology exceeds the net operational assets of the business, the excess or premium is typically referred to as the Goodwill component.
In many small businesses, Goodwill can represent a significant amount of a business’ value, however its intangible nature can lead to disagreement between parties.
When determining the Goodwill of a business, it is important to understand the different types of Goodwill that may exist in a business. Common types of Goodwill will include:
Personal Goodwill
Where the owners of the business have personal followings of clients such as professional services firms, this is typically attributable to Personal Goodwill. The risk (which is typically built into any earnings multiple) is that when businesses are sold or key personnel exit the business, there is a risk that clients may also leave.
Values which are attributable to Personal Goodwill should be carefully considered by a valuer and have regard to the existence of restrictive covenants or guarantees that a vendor is willing to provide.
Corporate Goodwill
Corporate Goodwill will generally attach to the business independent of its owners and arises from having an established brand or reputation, key product lines or a loyal customer base.
Corporate Goodwill commonly exists with businesses in the wholesale and manufacturing industry where reliance on key business owners is less critical to client retention and the operations of the business.
Location Goodwill
Where businesses operate from strategically located premises, Goodwill can sometimes be attributable to Location Goodwill.
Businesses which possess Location Goodwill may include Aged Care Facilities, Motels and Childcare Centres, however when attributing some or all of the Goodwill of a business to its location, a valuer should have regard to the following risk factors that may have an effect on this assessment:
Conclusion
The different types of Goodwill extend beyond those listed above and it is crucial that valuers properly consider the characteristics of the business being valued when undertaking their assessment.
For any specific or general business valuation queries, please get in touch with one of our qualified and experienced experts.
Latest News & Insights
Temporary Insolvent Trading Moratorium Update
Directors seeking to rely on the temporary relief from insolvent trading may only be able to do so if the company enters voluntary administration or liquidation prior to 31 December 2020.
Understanding Goodwill
When determining the Goodwill of a business, it is important to understand the characteristics of the business and the different types of Goodwill that may exist.
Business Restructuring: What are my options?
/in Insights /by GT Advisory & ConsultingBusiness Restructuring: What are my options?
GT Advisory & Consulting work with businesses across all stages of the business cycle by developing solutions to drive business turnaround, refocus strategic direction and fine tune business performance.
Drawing on our in-depth industry expertise, we develop strategies which assist businesses navigate a diverse range of commercial challenges, by:
BUSINESS RESTRUCTURING
Our restructuring strategies are designed to equip directors and management teams with the information they need to make informed business decisions which maximise value for stakeholders and give businesses their best chance of survival.
Through our proactive and hands-on approach, we:
Operating within the confines of a strict legal and regulatory framework, we provide decision makers with carefully considered advice so that strategies can be executed with confidence.
BUSINESS TURNAROUND AND PERFORMANCE IMPROVEMENT
We work with underperforming businesses and businesses facing financial distress to formulate turnaround and business improvement strategies which are designed to refocus the business’ strategic direction on revenue maximising activities, and return businesses to profitability.
As an agile advisory firm, we are able to assist management by:
We take the time to properly understand the business and provide management with the necessary tools to drive financial turnaround and restore business value.
INSOLVENCY
GT Advisory & Consulting also specialises in insolvency and business recovery, including assisting companies with the corporate insolvency processes such as voluntary administration and liquidation, and helping individuals with the personal insolvency process, which can include applying for bankruptcy or facilitating a formal offer to creditors through a personal insolvency agreement.
Insolvency is a complex area of accounting where an understanding of effective strategies is essential for achieving the best outcomes. At GT Advisory & Consulting, we have the specialist expertise that is required when dealing with distressed assets, individuals and businesses. We deliver commercial and innovative solutions on each engagement, working with all stakeholders to clearly understand objectives and to implement a strategy that will maximise returns and achieve the best possible outcome for all parties.
INCREASING THE OPTIONS
Early intervention is always key. Businesses facing challenging operating conditions should seek prompt, specialist advice to reduce the risks and consequences of financial failure and increase the options available to the business.
For any specific or general queries regarding your business, or to discuss the restructuring options available, please get in touch with one of our qualified and experienced experts.
Latest News & Insights
Temporary Insolvent Trading Moratorium Update
Directors seeking to rely on the temporary relief from insolvent trading may only be able to do so if the company enters voluntary administration or liquidation prior to 31 December 2020.
Understanding Goodwill
When determining the Goodwill of a business, it is important to understand the characteristics of the business and the different types of Goodwill that may exist.
Future-Proof Your Business: Strategic Restructuring Options for Business Owners
/in Insights /by James CookFuture-Proof Your Business: Strategic Restructuring Options for Business Owners
With 25 September 2020 just around the corner, it is now more important than ever that business owners pause and take stock to carefully consider what the next 12 months of trading might look like for their business.
In March 2020, the Federal Government introduced the Coronavirus Economic Response Package Omnibus Act 2020 (Cth) which was designed to provide temporary relief to businesses and stimulate economic activity. Among the incentives and temporary measures initiated by the Federal Government, many business owners have subsequently been able to:
Whilst these temporary measures have had their desired effect, this has however, created an artificial economic environment for many businesses, which has left many business owners awash with cash and a false sense of business performance.
As the temporary relief begins to wind back from 25 September 2020, the months of August and September should serve as an opportune time for business owners to take stock and ensure they are preparing their business for the next phase of the recovery cycle.
EARLY INTERVENTION IS KEY
As businesses slowly begin to be weaned off the Federal Government’s various stimulus packages, it is critical that business owners now use the comings months to:
Businesses facing challenging operating conditions should seek prompt, specialist advice to reduce the risks and consequences of financial failure and increase the options available to the business.
WHERE GT ADVISORY & CONSULTING CAN ASSIST
During times of business distress, we work alongside directors and management teams to manage the financial pressures on the organisation and develop strategies that maximise value for stakeholders.
Read more here to learn about how GT Advisory & Consulting can assist.
Latest News & Insights
Temporary Insolvent Trading Moratorium Update
Directors seeking to rely on the temporary relief from insolvent trading may only be able to do so if the company enters voluntary administration or liquidation prior to 31 December 2020.
Understanding Goodwill
When determining the Goodwill of a business, it is important to understand the characteristics of the business and the different types of Goodwill that may exist.
What are Surplus Assets and Liabilities in business valuation?
/in Insights /by James CookWhat are Surplus Assets and Liabilities in business valuation?
When determining the equity value of a company, a valuer will typically test for the existence of Surplus Assets and Liabilities held by the company.
Surplus Assets are represented by any assets that are held by a business that are not core to its underlying operations and do not support the business in any way. Surplus Assets will typically include:
Similarly, when determining the equity value of a company, a valuer will also need to take into account the liabilities of the business. Liabilities that are typically considered and deducted from the enterprise value of the business include:
Every business that is valued under the capitalisation of future maintainable earnings method should be assessed for surplus assets and liabilities.
The impact of surplus assets and liabilities should be considered at two levels:
Level 1
Where the entity as a whole is being valued, the value of the surplus assets and liabilities should be added/deducted from the capitalisation of future maintainable earnings calculation to determine the entity value.
If the valuation is for the business assets, surplus asset or liability value is only relevant if the assets or liabilities to be included in the class of assets, form part of the valuation.
Level 2
Consideration also needs to be given to whether the surplus assets or liabilities have created holding costs for the business. Where these holding costs are identified, they should be quantified and adjusted out of the calculation of Future Maintainable Earnings.
Latest News & Insights
Temporary Insolvent Trading Moratorium Update
Directors seeking to rely on the temporary relief from insolvent trading may only be able to do so if the company enters voluntary administration or liquidation prior to 31 December 2020.
Understanding Goodwill
When determining the Goodwill of a business, it is important to understand the characteristics of the business and the different types of Goodwill that may exist.