BusinessBusiness RecoveryInsolvency ethics code offers reassurance to creditors

Insolvency ethics code offers reassurance to creditors

Insolvency Service produces a document that finally gains the approval of the seven recognised licensing bodies after 18 months in the pipeline

Insolvency practitioners are busy people at the moment, dealing with a
growing number of company collapses and individuals trying to ward off
bankruptcies.

Faced with an increased workload, they are under intense pressure from
creditors and unions to achieve the best deal for all sides.

From January all IPs working in the UK will have to follow the profession’s
new ethical code after the Insolvency Service produced a document which finally
gained the approval of the seven recognised licensing bodies after 18 months in
the pipeline. These included the ICAEW, ICAS and ACCA, as well as the Law
Society in England & Wales and the Law Society of Scotland.

The code has been rolled out in an effort to clarify professional and ethical
standards. The insolvency code of ethics replaces the less stringent and
voluntary ethical guide and provides guidance on all aspects of insolvency.
These range from pre-packaged administrations and finding work to using
specialist agents and referral fees. IPs who breach the code of conduct could
find themselves fined or, in extreme cases, struck off.

Breaches of the code may be taken into account by an IP’s authorising body
when assessing their conduct, the Insolvency Service said.

‘Integrity and objectivity have always been fundamental principles which
insolvency practitioners should apply in all aspects of their work,’ said Mike
Chapman, head of insolvency practitioner regulation at the Insolvency Service.
‘The code will provide practitioners with clear guidance on what they can and
cannot do in their professional life and assist them to work to high
professional and ethical standards’.

One IP who asked not to be named said that one of the main reasons for the
code was to reassure creditors and other interested parties minds’ that IPs were
acting to high standards.

‘It needs to be transmitted to creditors and employer groups that they can be
sure that activities are being dealt with in a proper and orderly manner,’ the
IP said.

‘With all those regulators you’re bound to get some differences in emphasis,’
added one leading IP.

Related Articles

EY hired by Carillion to review finances

Accounting Firms EY hired by Carillion to review finances

3m Alia Shoaib, Reporter
Using insolvency as a debt recovery tool

Business Recovery Using insolvency as a debt recovery tool

4m Emma Smith, Managing Editor
UK government should support mid-sized businesses to create a ‘new economy’ post-Brexit, says BDO report

Business Recovery UK government should support mid-sized businesses to create a ‘new economy’ post-Brexit, says BDO report

6m Alia Shoaib, Reporter
Manor Racing Formula One team company enters administration

Business Recovery Manor Racing Formula One team company enters administration

9m Stephanie Wix, Writer
Oil and gas sector insolvencies hit “new high”

Accounting Firms Oil and gas sector insolvencies hit “new high”

9m Stephanie Wix, Writer
Over 800 jobs saved as Endless LLP acquires Jones Bootmaker

Business Recovery Over 800 jobs saved as Endless LLP acquires Jones Bootmaker

7m Emma Smith, Managing Editor
FRP Advisory expands operation with new office, partner appointments

Accounting Firms FRP Advisory expands operation with new office, partner appointments

8m Emma Smith, Managing Editor
Business confidence drops to second lowest level since 2011

Business Recovery Business confidence drops to second lowest level since 2011

9m Stephanie Wix, Writer