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05 Nov 2009
The insolvency profession could be indundated with qualified professionals but there may not be enough work to go around, experts have warned.
An influx of students sitting insolvency exams is reaching record levels but already qualified professionals are struggling to find profitable work, despite the recession and high levels of business and personal bankruptcy.
"It is already becoming difficult to find work out there for IPs," said Mark Sands, head of bankruptcy for Tenon.
"There are approximately 70,000 bankruptcies and just 5,000 have assets," he added.
The growing popularity of renting rather than buying property could reduce assets in a company administration or personal insolvency, explained Sands.
"When there are no assets the official receiver will keep the case, meaning there is even less work for the IP," he added.
Joanne Wright, personal insolvency partner at Begbies Traynor, warned that a qualification failed to guarantee a flow of work. "We may have more qualified people but this doesn't necessarily mean they will take appointments, as it could be that there is not enough work to go round," she said.
Insolvency Service statistics released earlier this year revealed 426 IPs failed to take appointments, out of 1,701 licensed practitioners in 2008.
"In some ways the profession is caught between a rock and a hard place.
"Previously there was a worry there were not enough IPs and now there is a worry that there could be too many," Wright said.
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Visitor comments Add your comment
What a strange article
People take the IP exams at differing stages of their career and the vast majority will not be appointment takers following completion. The comments from so called industry specialist also beggar belief (official receivers and administrations mentioned in the same sentence??). Having qualified IP's on the workforce is a good thing it demonstrates a commitment to training and staff development even if it does not lead to appointment taking status.
An inane and pointless article
Posted by: N, 09 Nov 2009 | 00:00
FAIRER DISTRIBUTION OF BANKRUPTCIES
"There are approximately 70,000 bankruptcies and just 5,000 have assets." This is a very interesting statistic and brings into question the Insolvency Service's policy of failing to operate the Secretary of State's rota for trustee in bankruptcy appointments properly.
In fact it is not really operated as a rota at all. When the Official Receiver doesn't want to call a creditors' meeting to appoint a trustee, instead of automatically appointing the next insolvency practitioner on the rota (i.e. the very raison d?être of the rota), he calls the major creditor (very often a bank) and asks if the creditor has a preferred IP, who then gets the appointment. Only if there is no preference expressed does the case actually go out according to an IP?s position on the rota.
Now, surely it's either a rota or it isn't? If it is a rota, it should be operated in strict rotation, by definition. If the OR wants to take creditors' views into account when a trustee is being appointed, he should call a creditors' meeting and let them vote, not procure a back-door appointment of one of the Big 4 firms who are close to the banks. That way there might be a rather more equitable apportionment of bankruptcy cases amongst all willing IPs.
Posted by: Alan R Price, 11 Nov 2009 | 00:00