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Report to creditors 5 June 2018 Far Pavilions Interiors Pty Ltd (In Liquidation) ACN 010 287 831
Meeting of creditors Date: 22 June 2018 Time: 10:00am Place: Level 27,
345 Queen Street Brisbane Qld 4000
PPB Pty Limited trading as PPB Advisory ABN 67 972 164 718 Liability limited by a scheme approved under Professional Standards Legislation PPB Pty Ltd has associated but independent entities and partnerships
FORMS TO BE COMPLETED
Complete and return the following forms which are attached to the back of this report by 4:00pm 21 June 2018
1. formal proof of debt
2. appointment of proxy
Please return these forms to:
Mail: GPO Box 1216
BRISBANE QLD 4001
Fax: 07 3222 6899
Email: [email protected]
Table of contents
1. Introduction and purpose of report 4
2. Asset realisations 4
3. Investigations 5
4. Offences and liquidation recoveries 6
5. Declaration of dividend 6
6. Summary of Receipts and Payments 7
7. Early destruction of books and records 7
8. Future actions 8
9. Remuneration 8
10. Meeting of creditors 8
11. General information about insolvency 9
Appendices
A. Remuneration report
B. Notice of Meeting
C. Appointment of proxy form
D. Proof of debt Form 535
E. Insolvency information for directors, employees, creditors and shareholders
F. Creditors rights in liquidations
Glossary
Term Abbreviation
ACN Australian Company Number
ARITA Australian Restructuring Insolvency and Turnaround Association
ASIC Australian Securities and Investments Commission
Director Michael Edwards
GST Goods and Services Tax
IPS Insolvency Practice Schedule of the Corporations Act 2001
Liquidators Michael Owen and Martin Ford of PPB Advisory as joint and several Liquidators
the Act Corporations Act 2001
the Company Far Pavilions Interiors Pty Ltd (In Liquidation)
4
PPB Advisory – Report to creditors
1. Introduction and purpose of report
We refer to our appointment as Administrators of the Company on 8 July 2016 and subsequent appointment as Liquidators of the Company on 15 August 2016 pursuant to a resolution at the second meeting of creditors held on that date.
1.1 Annual Report
This report should be read in conjunction with our report to creditors dated 3 August 2016 and our subsequent Annual Report dated 9 November 2017 lodged with ASIC in lieu of convening a meeting of the Company’s creditors due to the associated meeting costs.
The Annual Report details
• Our acts and dealings in the conduct of the winding up during the preceding year
• The acts and dealings that remain to be carried out by the Liquidators of the Company, and
• An estimate of when the winding up is likely to be completed.
Pursuant to Section 1603 (Section 508(4)(c) [Repealed]) of the Act any creditor may obtain a copy of the annual report free of charge and it is available for download on our website https://www.ppbadvisory.com.
1.2 Purpose of this report
For convenience, details included in the Annual Report have been restated where appropriate in this updated report to creditors.
This updated report is provided by the Company’s Liquidators to inform creditors of the status of the winding up generally, including:
• Outcome of investigations into offences, voidable transactions and insolvent trading by the Company and its directors.
• Updated estimated dividend range.
• Convene a meeting of creditors.
• Future action to be taken in the winding up.
2. Asset realisations
2.1 Asset realisations
The Liquidators have realised the following assets:
Item $ (Inc. GST)
Cash on hand 64,857
Debtors 17,613
Other Assets 81,408
Plant and equipment 47,589
Sale of stock on hand on post-appointment closure of the stores 77,000
Settlement – Jenny Edwards 35,000
Trade sales of stock on hand on appointment 1,871,114
Total 2,194,581
The Liquidators traded the business from the date of their appointment as Administrators until 31 July 2016, when it was necessary to close the retail stores as insufficient stock was available to continue trading.
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PPB Advisory – Report to creditors
2.2 Sale of business
Sale of the Company’s assets (including residual stock, store fit outs, plant and equipment and intellectual property) was completed on 5 December 2016. The total sale proceeds were $25,000 (plus GST). Net sale proceeds were paid to the secured creditor.
2.3 Federal Court of Australia – Orders and Directions regarding certain stock
Orders and directions by the Federal Court of Australia were sought to determine how to deal with stock in circumstances when title had passed to a group of customers who paid for their stock in full but where there were insufficient items in stock to satisfy the stock allocation.
The Court Order received is summarised as follows:
• title in the stock items had passed to a group of customers who had paid for stock in full, to whom items within that stock line had been allocated but in respect of which there were insufficient items in stock to satisfy the stock allocations. In selling those stock items, a distribution of the net sale proceeds on a pari passu (i.e. pro rata) basis is then to be made to those customers;
• the Liquidators were entitled to exercise a lien for future expenses incurred in the identification, preservation and sale of those stock items;
• the Liquidators were granted an entitlement to an indemnity in equity out of stock items for reasonable expenses incurred in the identification, preservation and sale of those stock items;
• the Liquidators may require payment of a levy by customers to whom title has passed in those stock items on a pro rata basis, representing their reasonable expenses incurred in identifying, preserving and selling those stock items.
Investigations were completed into the method of sale by either auction, warehouse sale or ‘in one line’ to one of the parties previously identified during the marketing campaign we conducted for sale of the Company and its assets. It was determined the sale ‘in one line’ was likely to provide the highest sale price (without incurring the advertising, commission and wages costs associated with the other options) and was therefore the most appropriate method of sale.
Sale of the stock was completed on 15 August 2016 and we made a distribution of the net sale proceeds on a pari passu basis to the affected customers in accordance with the terms of the Court Order.
2.4 Debtors
Debtors totalling $14,862 have been collected to date. The remaining debtors are of nominal value and not considered commercial to pursue.
3. Investigations
Our further investigations have not identified any information that causes us to amend our view the Company was insolvent on or about 30 June 2015, as reported at section 7 of our Report to Creditors dated 3 August 2016.
Our investigations indicate further breaches of the Act by the Company director, including:
• Section 180 – Care and diligence
• Section 181- Good faith
• Section 182 - Use of position
• Section 286/344(1) – Obligation to keep financial records.
A report of our findings has been lodged with ASIC, pursuant to s533 of the Act. Creditors should be aware that this report is not available to the public. ASIC advised they will not take further action on the matters detailed in our report.
6
PPB Advisory – Report to creditors
4. Offences and liquidation recoveries
As noted above, we are of the view that the Company was insolvent on or about 30 June 2015 and, in accordance with Section 588G of the Act, the Director has a duty to prevent insolvent trading by the company. The management accounts of the Company did not correctly explain its performance and financial position. The books and records are therefore considered deficient and gives rise to a presumption of insolvency (s588E(4)).
4.1 Recoveries sought from Michael Edwards
The Company paid various expenses totalling $116,508 between June 2013 and June 2014. We determined those expenses were not incurred for the benefit of the Company, but for Mr Edwards’ benefit in a private capacity. Pursuant to Section 588FDA of the Act a transaction is a voidable transaction if it is an unreasonable director-related transaction.
On 7 July 2016, the day preceding our appointment as Administrators, five motor vehicles with a total value of $63,800 were transferred from the Company to the Director in partial satisfaction of the director’s loan account with the Company. Solicitors acting for Mr Edwards submitted a settlement offer for a mutual release between the parties in respect to all past, present, and future actions or claims in relation to our demands made pursuant to section 588FA and 588FDA of the Act. The settlement offer comprised a cash payment of $10,000 and transfer of a motor vehicle trailer valued at approximately $2,200. We unsuccessfully sought to negotiate a higher settlement value. Settlement based on the initial offer has not been completed as at the date of this report. 4.2 Recoveries sought from Jenny Edwards
Investigations undertaken suggest Ms Jenny Edwards (the Director’s sister) received an unfair preference for the termination of her full-time employment with the Company in the amount of $120,917. Solicitors acting for Ms Edwards submitted a settlement offer for a mutual release between the parties in respect to all past, present, and future actions or claims in relations to our demands made pursuant to section 588FA of the Act. After considering the financial position of Ms Edwards, a settlement offer for an amount of $35,000 was accepted by the Liquidators and the settlement amount was received on 20 February 2018.
5. Declaration of dividend
5.1 Priority employee entitlements
Employee claims are paid in priority to ordinary unsecured creditors pursuant to Section 556 of the Act.
Priority claims, in order, are:
1. wages and superannuation
2. annual leave and long service leave
3. redundancy and payment in lieu of notice
We advised in our Report to Creditors dated 3 August 2016 the estimated net dividend (i.e. after realisation and other costs) was in the range of 81 cents to 100 cents in the dollar to priority creditors. We currently estimate the final return to priority creditors will be approximately 74 cents in the dollar. The reduction of the estimated dividend predominantly results from actual debtor collections and voidable transaction recoveries being less than initially budgeted.
A summary of priority payments paid to date is detailed below:
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PPB Advisory – Report to creditors
Priority claims Amount claimed ($)
Cents in dollar Dividend ($)
Wages 0 N/A 0
Superannuation 16,747 100 16,747
Annual leave 159,031 100 159,031
Long service leave 103,554 100 103,554
Redundancy 241,376 30 72,413
Payment in Lieu of Notice (PILN) 92,018 30 27,605
Total 612,726 379,350
The above payments do not include entitlements that may be payable to excluded employees (i.e. Michael Edwards and Jenny Edwards) capped at $3,500 each pursuant to Sections 556(1A) and 556(1B) of the Act. Payment of these entitlements is subject to the excluded employees submitting a proof of debt and supporting documents for any unpaid employee entitlements they consider are owed to them. We will adjudicate any proof of debt received in accordance with the terms of the Act before paying any dividend to any excluded creditor.
Former employees contacted the Department of Jobs and Small Business (responsible for administrating the Fair Entitlements Guarantee scheme (FEG)) directly to claim the balance of their pre-appointment PILN and redundancy entitlements. The Department of Jobs and Small Business is now subrogated into the position of those employees to whom they made a payment.
5.2 Unsecured creditors (excluding employees)
No dividend will be paid to any other class of creditors (including ordinary unsecured creditors).
6. Summary of Receipts and Payments
Pursuant to Section 1592 (Section 539(1) [Repealed]) of the Act, we lodge a detailed account of receipts and payments with ASIC every six months with a statement of position of the Liquidation. Such accounts have been prepared and lodged up to 14 February 2018 and are available for inspection at ASIC.
A summary of administration receipts and payments is enclosed with the attached remuneration Approval report.
7. Early destruction of books and records
IPS 70-35(1) requires the last external administrator of a company (i.e. the Liquidators in this instance) to retain all books of the company, and of the external administration of the company for a period of five years from the end of the external administration, that:
(a) are relevant to the affairs of the company; and
(b) are in the external administrator’s possession or control at the end of the external administration.
IPS 70-35(3) provides for destruction of the books and records within the five year period, but subject to a creditor’s resolution approving, and ASIC’s consent to, the earlier destruction of the books and records. Subject to creditors approving the appropriate resolution, we will request ASIC’s consent to the earlier destruction of the books and records as soon as possible after the Company is deregistered.
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PPB Advisory – Report to creditors
8. Future actions
Actions to finalise this Liquidation include:
(a) determine whether to continue to pursue voidable transactions,
(b) declare and pay the final dividend for priority creditors (i.e. employee entitlements and includes FEG for its subrogation rights pursuant to section 560 of the Act),
(c) attend to statutory reporting requirements.
9. Remuneration
The creditors will be requested at the forthcoming meeting to approve the Liquidators’ discounted remuneration of $130,000 (excluding GST) for the period from 30 November 2016 to the conclusion of the liquidation. Total work in progress was $198,293 as at 25 May 2018.
Details of the Liquidators’ remuneration are set out in the Remuneration Report enclosed at Appendix A. Remuneration detailed in the Liquidators’ Remuneration Report has not previously been approved.
10. Meeting of creditors
10.1 Meeting of creditors
A meeting of the Company’s creditors will be held on:
Date: 22 June 2018
Registration: 9:30am
Meeting time: 10:00am
Venue: PPB Advisory, Level 27, 345 Queen Street, Brisbane
The purpose of the meeting is to:
• provide creditors with an update on the progress of the liquidation.
• provide creditors with a forum to ask questions of the Liquidators.
• request remuneration and internal disbursements approval.
• request the creditor approval for the early destruction of books and records.
• Consider and the following resolutions:
Resolution 1
“To approve the remuneration of the Liquidators for the period 30 November 2016 to the conclusion of the liquidation of $130,000 plus GST as set out in the Remuneration Approval Report dated 5 June 2018 to be drawn from available funds immediately or as funds become available.”
Resolution 2
“To approve internal disbursements of the Liquidators for the period 1 September 2017 to 1 March 2018 of $195.30 plus GST as set out in the Remuneration Approval Report dated 5 June 2018 to be drawn from available funds immediately or as funds become available.”
Resolution 3
“To approve the internal disbursements of the Liquidators for the period 2 March 2018 to the conclusion of the liquidation up to a maximum of $500 plus GST.”
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PPB Advisory – Report to creditors
Resolution 4
“To approve early destruction of the Company’s books and records six months after finalisation of the winding up of the Company, subject to authorisation from ASIC.”
The following meeting documents are also attached:
• Notice of meeting, Appendix B
• Appointment of proxy, Appendix C
• Proof of debt, Appendix D
10.2 Submission of Proof of Debt and Proxy
Creditors who have already lodged a proof of debt for dividend or voting purposes will not need to complete a new proof of debt in the event the amount of their debt remains unchanged. However, proxy forms lodged by creditors for the meetings held on 20 July 2016 and 15 August 2016 cannot be used for this next meeting.
Creditors who are unable to attend the meeting and wish to be represented should ensure that a proxy form, power of attorney or evidence of appointment of the company representative is completed. A creditor may also choose to appoint the Chairperson to vote on their behalf.
In accordance with the Act, all corporate creditors are also required to submit a proxy should they wish to be represented at the meeting.
Creditors are requested to return the completed proof of debt and proxy forms by no later than 4:00pm on 21 June 2018:
By facsimile: +61 7 3222 6899
By email: [email protected]
By mail: PPB Advisory
GPO Box 1216
Brisbane QLD 4001
Attention: Alison McLaughlin
9.3 Voting Rights
Motions at the meeting of creditors will be:
(a) Carried on the voices if a majority of the creditors voting (whether in person, by attorney or by proxy) vote in favour of that motion.
(b) Where a poll is conducted, a resolution is passed if the majority of creditors (based on dollar value) and the majority of creditors (in number – each creditor counted as one), vote in favour of the motion. When a poll is taken and there is a deadlock, the Chairperson may exercise a casting vote either in favour of or against the resolution. The Chairperson may also decide not to exercise their casting vote.
11. General information about insolvency
Information brochures published by the ASIC entitled “Liquidation, A guide for creditors”, and other information sheets containing information about Insolvency Administrations for creditors, stakeholders and employees can be obtained from the ASIC’s website at www.asic.gov.au/insolvencyinfosheets .
A copy of the Insolvency information for directors, employees, creditors and shareholders is enclosed at Appendix E.
We are members of the Australian Restructuring Insolvency & Turnaround Association (formerly known as IPA) and subscribe to the Code of Professional Practice for Insolvency Practitioners available on ARITA's website at wvvw.arita.conn.au .
A copy of the publication Creditors rights in liquidations is enclosed at Appendix F.
If there are any questions regarding the Liquidation, please contact Alison McLaughlin of this office.
Dated this 5t h day of June 2018
Michael Owen and Martin Ford Liquidators
Date of appointment: 15 August 2016
Contact name: Alison McLaughlin
Telephone number: +61 7 3222 6829
Email: [email protected]
PPB Advisory — Report to creditors 10
A. Remuneration report
Ap
pen
dix
A
Remuneration Approval report Far Pavilions Interiors Pty Ltd (In Liquidation) (the Company) ACN 010 287 831
1. Declaration
2. Executive summary
3. Remuneration
4. Disbursements
5. Summary of receipts and payments
6. Queries
This remuneration approval report provides you with the information you need to be able to make an informed decision regarding the approval of our remuneration.
You should read this report and the other documentation that we have sent you and then attend the meeting of creditors in order to voice your opinion by casting your vote on the resolutions put to the meeting. The meeting will also give you an opportunity to ask any questions that you may have.
Alternatively, you are also able to appoint a representative to attend on your behalf by lodging a proxy form. Lodging a specific proxy form allows you to specify how your proxy must vote. Lodging a general proxy form allows your representative to choose how your vote is exercised.
Information about the meeting of creditors is provided in the report to creditors dated 5 June 2018.
1. Declaration
We, Michael Owen and Martin Ford of PPB Advisory, have undertaken a proper assessment of this remuneration claim for our appointment as joint and several Liquidators of Far Pavilions Interiors Pty Ltd in accordance with the law and applicable professional standards. We are satisfied that the remuneration claimed is in respect of necessary work, properly performed, or to be properly performed, in the conduct of the administration.
Dated this 5th day of June 2018
Michael Owen and Martin Ford Liquidators
Page 2
Page 3
2. Executive summary
To date, remuneration totalling $647,740.12 has been approved and paid in respect of the Voluntary Administration and the Liquidation of the Company. Remuneration currently claimed and previously approved is summarised below:
Period Report Reference
Amount (ex GST)
Past remuneration approved for the Voluntary Administration:
Fees for the period 8 July 2016 to 31 July 2016
Fees for the period 1 August 2016 to 15 August 2016
Total Remuneration for the Voluntary Administration
Past remuneration approved for the Liquidation:
Fees for the period 15 August 2016 to 30 November 2016
Total past remuneration approved for the Liquidation
$392,741.00
$105,000.00
$497,741.00
$149,999.12
$149,999.12
Current remuneration approval sought:
Liquidation
Resolution 1: To approve the remuneration of the Liquidators for the period 30 November 2016 to the conclusion of the liquidation of $130,000 plus GST as set out in the Remuneration Approval Report dated 5 June 2018 to be drawn from available funds immediately or as funds become available.
3.2 $130,000.00
* Approval for the future remuneration sought is based on an estimate of the work necessary to the completion of the administration. Should additional work be necessary beyond what is contemplated, further approval may be sought from creditors.
Our current work in progress report shows that total fees for the work done in this liquidation for
the approval period to date is $198,293.
This has increased compared to our estimate contained in the report to creditors dated 3 August 2016 because of:
• Volume and complexity of customer enquiries
• Application to Court regarding stock ownership issues
• Allocation and distribution of third party assets
• Investigations and recoveries of related-party debts
• Priority dividend payments
While the liquidators are entitled to request payment for their total work in progress, we have elected to apply a discount in order to reduce our remuneration approval request to $130,000 (excluding GST) and thus increase the amount of funds available to distribute to the priority creditors.
Page 4
Internal disbursements currently claimed are summarised below:
Period Report Reference
Amount (ex GST)
Current internal disbursements claim:
Liquidation
Resolution 2: To approve internal disbursements of the Liquidators for the period 1 September 2017 to 1 March 2018 of $195.30 plus GST as set out in the Remuneration Approval Report dated 5 June 2018 to be drawn from available funds immediately or as funds become available.
4 $195.30
Resolution 3: To approve internal disbursements of the Liquidators for the period 2 March 2018 to the conclusion of the liquidation up to a maximum of $500 plus GST.
4 $500.00
* Approval for the future internal disbursements sought is based on an estimate of the internal disbursements necessary to the completion of the administration. Should additional work be necessary beyond what is contemplated, further approval may be sought from creditors.
Please refer to report section references detailed in the above table for full details of the calculation and composition of the remuneration approval sought.
3. Remuneration
3.1 Remuneration claim resolutions We will be seeking approval of the following resolutions. Details to support the resolutions relating to our remuneration and disbursements is included in section 3.2 and attached schedules. Resolution 1 To approve the remuneration of the Liquidators for the period 30 November 2016 to the conclusion of the liquidation of $130,000 plus GST as set out in the Remuneration Approval Report dated 5 June 2018 to be drawn from available funds immediately or as funds become available. Resolution 2 To approve internal disbursements of the Liquidators for the period 1 September 2017 to 1 March 2018 of $195.30 plus GST as set out in the Remuneration Approval Report dated 5 June 2018 to be drawn from available funds immediately or as funds become available. Resolution 3 To approve internal disbursements of the Liquidators for the period 2 March 2018 to the conclusion of the liquidation up to a maximum of $500 plus GST. Resolution 4 To approve early destruction of the Company’s books and records six months after finalisation of the winding up of the Company, subject to authorisation from ASIC. Where funds are available, we will usually pay approved remuneration at intervals not less than one month. Where funds are not available, remuneration will not be paid. 3.2 Details of remuneration The basis of calculating the remuneration claims are summarised in Annexure A.
Page 5
The details of the major tasks performed and the costs associated with each of those major tasks are contained in Annexure B. 3.3 Total remuneration reconciliation At the creditors meeting of 15 August 2016, creditors approved my prospective remuneration of $150,000 (drawn to $149,999.12) in addition to remuneration totalling $497,741 (excluding GST) for the Voluntary Administration period. Our remuneration has exceeded this cap for the reasons summarised previously in this report, and we are now seeking approval of a further capped amount of $130,000 to enable us to complete the Creditors Voluntary Liquidation.
We have provided an explanation of tasks completed to support our current remuneration approval request, contained in Annexure A As we are now in the process of declaring the final dividend to priority creditors and finalisation, we will not be seeking any future remuneration for this liquidation. 3.4 Likely impact on dividends The Corporations Act sets the order for payment of claims against the company and it provides for remuneration of the Liquidators to be paid in priority to other claims. This ensures that when there are sufficient funds, the Liquidators receives payment for the work done to recover assets, investigate the Company’s affairs, report to creditors and ASIC and distribute any available funds. Even if creditors approve our remuneration, this does not guarantee that we will be paid, as we are only paid if sufficient assets are recovered. Any dividend to creditors will also be impacted by the amount of assets that we are able to recover and the amount of creditor claims that are admitted to participate in any dividend, including any claims by priority creditors such as employees. We anticipate that we will pay a final dividend of approximately 32 cents in the dollar to the priority creditor. However there will not be sufficient funds to pay a dividend to ordinary, unsecured creditors 3.5 Remuneration recovered from external sources The Liquidators have not received any funding from external sources for their remuneration.
4. Disbursements
Disbursements are divided into three types:
• Externally provided professional services – these are recovered at cost. An example of an externally provided professional service disbursement is legal fees.
• Externally provided non-professional costs – these are recovered at cost. Examples of externally provided professional service disbursements are travel, accommodation, search fees, lodgement fees, storage, outsource printing and photocopying services and postage.
• Internal disbursements – these are generally charged at cost although some expenses may be charged at a rate which recoups both variable and fixed costs. Examples of internal disbursements include data room and cloud hosting.
We have undertaken a proper assessment of disbursements claimed for the Company in accordance with the law and applicable professional standards. We are satisfied that the disbursements claimed are necessary and proper. We will be seeking creditor approval to pay our internal disbursements from creditors.
Page 6
4.1 Internal disbursement claim The following disbursements have been incurred by our firm for the period from 1 September 2017 to 1 March 2018. Approval of these disbursements from creditors in the amount of $195.30 is being sought at a meeting of creditors
Disbursements paid
1 September 2017 to 1 March 2018
Total
Photocopies $32.60
Scanning $10.50
Printing (Colour) $22.80
Printing (Black and White) $129.40
Total $195.30
5. Summary of receipts and payments
The summary of receipts and payments for the period from 8 July 2016 to 25 May 2018 is contained in Annexure C.
6. Queries
Please contact Alison McLaughlin on +61 7 3222 6829 or by email on [email protected] should you have any queries or require any further information. You can access additional information on the following websites:
• ARITA at www.arita.com.au/creditors
• ASIC at http://asic.gov.au/regulatory-resources/insolvency/insolvency-information-sheets/
A. Calculations of remuneration schedules
An
nexu
re A
Far Pavilions Interiors Pty Ltd (In Liquidation)
ACN 163 180 836
Calculation of Remuneration
For the period 15 August 2016 to 25 May 2018
Employee Position $/hours Total Actual Total
(Ex GST) Hrs $ $ Hrs $ Hrs $ Hrs $ Hrs $ Hrs $ Hrs
Michael
Ow enAppointee 555 37.6 20,868.00 1,054.5 1.9 1,609.5 2.9 555.0 1.0 3,552.0 6.4 388.5 0.7 13,708.5 24.7
Martin Ford Appointee 555 1.4 777.00 - - - - 666.0 1.2 - - - - 111.0 0.2
Greg
CockingDirector 490 60.3 29,547.00 1,813.0 3.7 10,388.0 21.2 2,205.0 4.5 2,009.0 4.1 343.0 0.7 12,789.0 26.1
Mahala
HazellDirector 490 16.6 8,134.00 - - 4,165.0 8.5 1,862.0 3.8 882.0 1.8 - - 1,225.0 2.5
Anthony
Low eDirector 490 0.2 98.00 - - - - 98.0 0.2 - - - - - -
Mahala
Hazell
Senior
Manager460 69.08 31,776.50 1,058.0 2.3 9,614.0 20.9 15,860.5 34.5 1,610.0 3.5 1,978.0 4.3 1,656.0 3.6
Susan
Croucher
Senior
Manager460 2.9 1,334.00 736.0 1.6 - - - - 460.0 1.0 - - 138.0 0.3
Eudo Hadde Manager 390 0.8 312.00 - - - - 312.0 0.8 - - - - - -
Anne
Kolw ey-
Timm
Assistant
Manager340 4.6 1,564.00 - - 68.0 0.2 782.0 2.3 170.0 0.5 - - 544.0 1.6
Greer
Mason
Assistant
Manager340 21.4 7,276.00 - - 34.0 0.1 5,304.0 15.6 - - - - 1,938.0 5.7
Erin LordSenior
Consultant270 10.3 2,781.00 - - 1,323.0 4.9 81.0 0.3 - - - - 1,377.0 5.1
Anne
Kolw ey-
Timm
Senior
Consultant270 84.8 22,896.00 1,755.0 6.5 405.0 1.5 10,125.0 37.5 2,646.0 9.8 2,511.0 9.3 5,454.0 20.2
Shanna
Wood
Senior
Consultant270 4 1,080.00 1,026.0 3.8 54.0 0.2 - - - - - - - -
Gabrielle
ConnollyConsultant 225 41.5 9,337.50 270.0 1.2 472.5 2.1 112.5 0.5 - - - - 8,482.5 37.7
AdministrationAssets Creditors Employees Investigation Dividend
Olivia
HoustonConsultant 225 163.4 36,765.00 382.5 1.7 8,932.5 39.7 9,022.5 40.1 5,872.5 26.1 1,530.0 6.8 11,025.0 49.0
Alison
McLaughlinGraduate 190 21.6 4,104.00 76.0 0.4 1,064.0 5.6 836.0 4.4 - - - - 2,128.0 11.2
Olivia
HoustonGraduate 190 13.6 2,626.00 171.0 0.9 475.0 2.5 171.0 0.9 - - - - 1,809.0 9.3
Richard
BardsleyGraduate 190 40.4 7,676.00 855.0 4.5 - - 3,477.0 18.3 494.0 2.6 - - 2,850.0 15.0
Mackenzie
KaneGraduate 190 3.8 722.00 - - 266.0 1.4 - - 95.0 0.5 - - 361.0 1.9
Marcus
BertramGraduate 190 1.5 285.00 - - - - - - 19.0 0.1 - - 266.0 1.4
Senior
Bookkeeper140 29.1 4,074.00 - - - - - - - - - - 4,074.0 29.1
Administrati
on100 42.6 4,260.00 - - - - - - - - - - 4,260.0 42.6
Total 671.48 198,293.00 9,197.00 28.50 38,870.50 111.70 51,469.50 165.88 17,809.50 56.40 6,750.50 21.80 74,196.00 287.20
GST 19,829.30
Total
(Including
GST)
218,122.30
Average
rate
(excluding
GST)
295.31 322.70 347.99 310.28 315.77 309.66 258.34
B. Tables of major tasks for remuneration
An
nexu
re B
Resolution 1
The below table provides a description of the work undertaken in each major task area for the period 15 August 2016 to 25 May 2018
Task Area General Description Includes
Assets
28.5 hours
$9,197.00
Sale of Business as a Going Concern
Apply to ASIC regarding change of business name
Update secured creditors of sale process
Liaise with legal advisors regarding the sale agreements
Plant and Equipment Liaising with valuers, auctioneers and interested parties
Reviewing asset listings
Assets subject to specific charges
All tasks associated with realising a charged asset
Debtors Correspondence with debtors
Reviewing and assessing collectability of debtors ledger
Liaising with debt collectors and solicitors
Stock Conducting stock takes
Reviewing stock values
Liaising with purchasers
Other Assets Prepare demands to director regarding voidable transactions
Correspond with legal advisors regarding preference claims and voidable transaction claims
Deal with unclaimed monies
Leasing Reviewing leasing documents
Liaising with owners
Tasks associated with disclaiming leases
Creditors
111.70 hours
$38,870.50
Creditor Enquiries Deal with creditor enquiries via telephone and email
Maintaining creditor enquiry files
Review and prepare correspondence to creditors and their representatives via facsimile, email and post
Retention of Title Claims Search the PPSA register
Notify PMSI creditors identified from PPSA register
Receive initial notification of creditors’ intention to claim
Provision of retention of title claim form to creditors
Receive completed retention of title claim forms
Maintain retention of title file
Meeting claimants on site to identify goods
Adjudicate retention of title claims
Forward correspondence to claimants notifying outcome of adjudication
Preparation of payment vouchers to satisfy valid claims
Preparation of correspondence to claimants to accompany payment of claims (if valid)
Secured creditor reporting Preparing reports to secured creditor
Regular verbal updates, including meetings, to secured
Task Area General Description Includes
creditor
Review guarantees with secured creditor
Attend to distribution of sale proceeds to secured creditor
Responding to secured creditor’s queries
Creditor reports Preparing investigations, meeting and general reports to creditors
Dealing with proofs of debt Receipting and filing POD when not related to a dividend
Meeting of Creditors Preparation of meeting notices, proxies and advertisements
Forward notice of meeting to all known creditors
Preparation of meeting file, including agenda, certificate of postage, attendance register, list of creditors, reports to creditors, advertisement of meeting and draft minutes of meeting
Preparation and lodgement of minutes of meetings with ASIC
Employees
165.88 hours
$51,469.50
Employees enquiries
Receive and follow up employee enquiries via telephone
Maintain employee enquiry files
Review and prepare correspondence to employees and their representatives via facsimile, email and post
Receive and prepare correspondence in response to employees objections to leave entitlements
FEG Correspondence with FEG regarding dividend
Preparing notification spreadsheet
Preparing FEG quotations
Preparing FEG distributions
Calculation of entitlements Calculating employee entitlements
Reviewing employee files and company’s books and records
Reconciling superannuation accounts
Prepare PAYG summaries
Prepare payslips
Prepare statement of superannuation guarantee charge to the ATO
Employee dividend Correspondence with employees regarding dividend
Correspondence with ATO regarding SGC proof of debt
Calculating dividend rate
Preparing dividend file
Advertising dividend notice
Preparing distribution
Adjudicating POD
Conducting investigation Reviewing company’s books and records
Review and preparation of company nature and history
Conducting and summarising statutory searches
Preparation of comparative financial statements
Preparation of deficiency statement
Task Area General Description Includes
Investigation
56.40 hours
$17,809.50
Review of specific transactions and liaising with director and legal advisers regarding certain transactions
Investigations to identify indicators of insolvency and possible claims for insolvent trading
Preparation of investigation file
Litigation / Recoveries Liaising with solicitors regarding recovery actions
Attending to settlement matters
ASIC reporting Preparing statutory investigation reports
Liaising with ASIC
Dividend
21.80 hours
$6,750.50
Processing proofs of debt Preparation of correspondence to potential creditors inviting lodgement of POD
Receipt of POD
Maintain POD register
Dividend procedures Preparation of correspondence to creditors advising of intention to declare dividend
Advertisement of intention to declare dividend
Preparation of dividend calculation
Preparation of correspondence to creditors announcing declaration of dividend
Advertise announcement of dividend
Preparation of distribution
Preparation of dividend file
Preparation of payment vouchers to pay dividend
Preparation of correspondence to creditors enclosing payment of dividend
Review and liaise with ASIC regarding unclaimed monies
Correspondence with ASIC
Administration
287.20 hours
$74,196.00
Correspondence Prepare labels for mail out
Prepare miscellaneous correspondence
Respond to miscellaneous telephone enquiries
Attend to inward correspondence
Correspondence with the Australian Bureau of Statistics
Prepare mail outs
Document maintenance/file review/checklist
First month, then six monthly administration reviews
Filing of documents
File reviews
Updating checklists
Insurance Correspondence with insurer regarding initial and ongoing insurance requirements
Reviewing insurance policies
Correspondence with Workcover
Bank account administration Requesting bank statements
Bank account reconciliations
Prepare Stops on Cheques
Correspondence with Westpac regarding the chargeback account
Review of pre appointment accounts
Task Area General Description Includes
ASIC Form 524 and other forms Preparing and lodging ASIC forms including 505, 524,
Correspondence with ASIC regarding statutory forms
ATO and other statutory reporting
Preparing BAS
Prepare PAYG summaries
Correspondence with the ATO regarding BAS lodgements
Finalisation
Notifying ATO of finalisation
Cancelling ABN / GST / PAYG registration
Completing checklists
Planning / Review Discussions regarding status of administration
Books and records / storage Dealing with records in storage
Investigate destruction of IT equipment
C. Summary of receipts and payments
An
nexu
re C
Far Pavillions Interiors Pty Ltd (In Liquidation)
ACN 010 287 831
Summary of Receipts and Payments for the period 8 July 2016 to 25 May 2018
Receipts Amount ($)
Refund of Pre-Appointment Deposit 1,096.80
Sales 1,871,114.38
Pre-Appointment Debtors 17,612.67
Pre - Appointment Cash at Bank 64,856.17
Interest Income 625.91
Sale of Stock/Inventory on Hand- Following store closures 77,000.00
Other Current Assets 60,928.30
Plant and Equipment 47,589.30
Preference Claim Recovery 35,000.00
Insurance Premium refund 17,918.52
Balance of Bond - Telephone, Internet, Data & Fax 839.89
Total Receipts 2,194,581.94
Payments
Administration Charge - Australian Taxation Office (1,500.00)
Advertising (19,872.64)
Cleaning & General Maintenance (474.52)
Commission Expense (67.32)
Freight Outwards (49,587.80)
Hire & Leasing (2,375.84)
Insurance (10,013.84)
IT Consumables & Services (39,688.00)
Leave - Annual Leave (6,979.52)
Leave - Long Service Leave (510.50)
Legal Fees (106,436.45)
Interest Charge (1,916.31)
PAYG Control (Trading): PAYG Withheld 37,314.78
Payroll Processing Expense (3,462.94)
Postal Office Expense (186.00)
Printing & Stationery (4,764.69)
Rent & Rates (142,218.78)
Security (17,699.01)
Storage Costs (1,072.50)
Subcontractors (612.00)
Sundry Expenses (34.00)
Superannuation (38,388.57)
Telephone, Internet, Data & Fax (11,625.03)
Utilities (13,561.04)
Valuation Fees (880.00)
Wages & Salaries (200,207.34)
Advertising (1,650.00)
Allocation of sale proceeds - Category "B" stock (5,312.59)
Appointee Disbursements (28,091.46)
Bank Charges (14,814.39)
Commission (4,456.76)
Fees: Appointee Fees (712,514.13)
First Interim Dividend for Preferred (Employee) Creditors (278,576.21)
Freight (11,964.70)
GST Control: GST Paid (201,497.00)
Hire & Leasing (660.00)
Payroll Tax Payable (6,009.00)
Proceeds from Sale of Plant and Equipment (52,850.00)
Removal Expenses (4,191.00)
Sales Proceeds to Creditor (11,464.36)
Total Payments (1,970,871.46)
Cash at Bank as at 25 May 2018 223,710.48
B. Notice of Meeting
Ap
pen
dix
B
Insolvency Practice Rules (Corporations) 2016 ss75-15 — 75-35
NOTICE OF MEETING OF CREDITORS Far Pavilions Interiors Pty Ltd (In Liquidation) (the Company)
ACN 010 287 831
Notice is given that a meeting of the creditors of the Company will be held at Level 27, 345 Queen Street, Brisbane QLD 4000 on 22 June 2018 at 10:00 AM.
AGENDA
1. To receive and consider a report from the Liquidators.
2. To fix or determine the remuneration of the Liquidators.
3. To approve the payment of internal disbursements incurred by PPB Advisory.
4. To consider the early destruction of books and records.
Creditors wishing to attend and vote are advised that proof of debts and proxies must be submitted to the Liquidator(s) by 4:00pm on 21 June 2018.
Dated this 5th day of June 2018
Michael Owen and Martin Ford Liquidators
Section 75-85 of the Insolvency Practice Rules (Corporations) sets out the entitlement to vote at meetings of creditors:
(1) A person other than a creditor (or the creditor's proxy or attorney) is not entitled to vote at a meeting of creditors. (2) Subject to subsections (3), (4) and (5), each creditor is entitled to vote and has one vote. (3) A person is not entitled to vote as a creditor at a meeting of creditors unless:
(a) his or her debt or claim has been admitted wholly or in part by the external administrator; or (b) he or she has lodged, with the person presiding at the meeting, or with the person named in the notice
convening the meeting as the person who may receive of the debt or claim: (i) those particulars; or (ii) if required—a formal proof of the debt or claim.
(4) A creditor must not vote in respect of: (a) an unliquidated debt; or (b) a contingent debt; or (c) an unliquidated or a contingent claim; or (d) a debt the value of which is not established;
unless a just estimate of its value has been made. (5) A creditor must not vote in respect of a debt or a claim on or secured by a bill of exchange, a promissory note or
any other negotiable instrument or security held by the creditor unless he or she is willing to do the following: (a) treat the liability to him or her on the instrument or security of a person covered by subsection (6) as a
security in his or her hands; (b) estimate its value; (c) for the purposes of voting (but not for the purposes of dividend), to deduct it from his or her debt or claim.
(6) A person is covered by this subsection if: (a) the person's liability is a debt or a claim on, or secured by, a bill of exchange, a promissory note or any
other negotiable instrument or security held by the creditor; and (b) the person is either liable to the company directly, or may be liable to the company on the default of
another person with respect to the liability; and (c) the person is not an insolvent under administration or a person against whom a winding up order is in force
C. Appointment of proxy form
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pen
dix
C
Insolvency Practice Rules (Corporations) 2016
Section 75-25
FORM 532
APPOINTMENT OF PROXY
Far Pavilions Interiors Pty Ltd (In Liquidation) (the Company)
ACN 010 287 831 A. Appointment of a proxy I/We, ………………………………………………………………………………………………………………............
(If a company, strike out “I” and set out full name of the company)
of ……………………………………………………………………………………………………………………………
(address)
a creditor of the Company appoint ......................................................................................................................
as my/our proxy, or in his/her absence…………………………………………………, to vote at the meeting of
creditors to be held on 22 June 2018 at Level 27, 345 Queen Street, Brisbane at 10:00am or at any
adjournment of that meeting.
B. Voting directions
Option 1: ☐ If appointed as a general proxy, as he/she determines on my/our behalf (Please proceed to section C, ie do not complete the table below)
and/or
Option 2: ☐ If appointed as a special proxy in the manner set out below: (Please complete the table below before proceeding to section C)
No Resolution For Against Abstain
1
To approve the remuneration of the Liquidators for the period 30 November 2016 to the conclusion of the liquidation of $130,000 plus GST as set out in the Remuneration Approval Report dated 6 June 2018 to be drawn from available funds immediately or as funds become available.
☐ ☐ ☐
2
To approve internal disbursements of the Liquidators for the period 1 September 2017 to 1 March 2018 of $195.30 plus GST as set out in the Remuneration Approval Report dated 6 June 2018 to be drawn from available funds immediately or as funds become available.
☐ ☐ ☐
3
To approve the internal disbursements of the Liquidators for the period 2 March 2018 to the conclusion of the liquidation up to a maximum of $500 plus GST.
4 To approve early destruction of the Company’s books and records six months after finalisation of the winding up of the Company, subject to authorisation from ASIC.
☐ ☐ ☐
C. Signature (in accordance with Sections 127 or 250D of the Corporations Act 2001)
If the creditor is an individual ……………………………………………………
If the creditor is a Company ………………………………………………………. Director/Company Secretary ………………………………………………………. Print name
Dated this day of
CERTIFICATE OF WITNESS Please Note: This certificate is to be completed only where the person giving the proxy is blind or incapable of writing. The signature of the creditor is not to be attested by the person nominated as proxy. I, _______________________________________ of ____________________________________________certify that the above instrument appointing a proxy was completed by me in the presence of and at the request of the person appointing the proxy and read to him before he attached his signature or mark to the instrument. Signature of witness: _________________________________
D. Proof of debt Form 535
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pen
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D
ACN: 010 287 831 Subregulation 5.6.49(2)
FORM 535 Corporations Act 2001
FORMAL PROOF OF DEBT OR CLAIM
To the Liquidators of Far Pavilions Interiors Pty Ltd (In Liquidation) (the Company)
1. This is to state that the Company was on 8 July 2016, and still is, justly and truly indebted
to (creditor) (name of creditor)
of (address of creditor)
for $
Particulars of the debt are:
Date (date when the debt arose)
Consideration
(state how debt arose and attach supporting documentation)
Amount ($) Remarks (include details of voucher substantiating payment)
2. To my knowledge or belief the creditor has not, nor has any person by the creditor's order, had or received any satisfaction or security for the sum or any part of it except for the following (insert particulars of all securities held. If the securities are on the property of the company, assess the value of those securities. If
any bills or other negotiable securities are held, show them in a schedule in the following form).
Date Drawer Acceptor Amount
($c)
Due Date
*3A. I am employed by the creditor and authorised in writing by the creditor to make this statement. I know that the debt was incurred for the consideration stated and that the debt, to the best of my knowledge and belief, remains unpaid and unsatisfied.
*3B. I am the creditor's agent authorised in writing to make this statement in writing. I know that the debt was incurred for the consideration stated and that the debt, to the best of my knowledge and belief, remains unpaid and unsatisfied.
* Items 3A & 38 - delete both if the creditor is a natural person and this proof is made by the creditor personally. In other cases, if, for example, you are the director of a corporate creditor or the solicitor or accountant of the creditor, you sign this form as the creditor's authorised agent (delete item 3A). If you are an authorised employee of the creditor (credit manager etc), delete item 38.
Com
ple
te a
ll se
ctio
ns
I have attached the following documents (tick as many as appropriate):
El Invoices EJudgement from Court
0 Monthly statements EStatutory demand
E Creditors authority letter flOther documents
0 Letters of demand E Orders from Company
ECredit application E Guarantee from Company
Dated / / Name Signatory
Phone Email address
Office use only — for voting purposes Accept Reject El
E. Insolvency information for directors, employees,
creditors and shareholders
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E
ASIC Australian Securities & Investments Commission
Insolvency information for directors, employees, creditors and
shareholders
This information sheet (INFO 39) lists ASIC's information sheets for directors, employees, creditors and shareholders
affected by a company's insolvency.
We have produced these with endorsement from the Australian Restructuring Insolvency & Turnaround Association
(ARITA).
The information sheets give a basic understanding of the three most common company insolvency procedures —
liquidation, voluntary administration and receivership — as well as the independence requirements for external
administrators and approving external administrator remuneration. There is also a glossary of commonly used insolvency
terms.
List of information sheets
• INFO 41 Insolvency: A glossary of terms
• INFO 42 Insolvency: A guide for directors
• INFO 43 Insolvency: A guide for shareholders
• INFO 45 Liquidation: A guide for creditors
• INFO 46 Liquidation: A guide for employees
• INFO 54 Receivership: A guide for creditors
• INFO 55 Receivership: A guide for employees
• INFO 74 Voluntary administration: A guide for creditors
• INFO 75 Voluntary administration: A guide for employees
• INFO 84 Independence of external administrators: A guide for creditors
• INFO 85 Approving fees: A guide for creditors
Where can I get more information?
Further information is available from the ARITA website. The ARITA website also contains the ARITA Code of Professional Practice for Insolvency Practitioners.
This is Information Sheet 39 (INFO 39) updated on 1 September 2017. Information sheets provide concise
guidance on a specific process or compliance issue or an overview of detailed guidance.
F. Creditors rights in liquidations
Ap
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F
„. A Creditor Rights in Liquidations
ARITA As a creditor, you have rights to request meetings and information or take certain actions:
Right to request a meeting
Right to request
information
Right to give directions to
liquidator
Right to appoint a reviewing liquidator
Right to replace
liquidator
In liquidations, no meetings of creditors are held automatically. However, creditors with claims of a certain value can request in writing that the liquidator hold a meeting of creditors.
A meeting may be requested in the first 20 business days in a creditors' voluntary liquidation by 5% of the value of the debts held by known creditors who are not a related entity of the company.
Otherwise, meetings can be requested at any other time or in a court liquidation by: • > 10% but < 25% of the known value of creditors on the condition
that those creditors provide security for the cost of holding the meeting
• 25% of the known value of creditors • creditors by resolution, or • a Committee of Inspection (this is a smaller group of creditors
elected by, and to represent, all the creditors).
If a request complies with these requirements and is 'reasonable', the liquidator must hold a meeting of creditors as soon as reasonably practicable.
Right to request information
Liquidators will communicate important information with creditors as required in a liquidation. In addition to the initial notice, you should receive, at a minimum, a report within the first three months on the likelihood of a dividend being paid.
Additionally, creditors have the right to request information at any time. A liquidator must provide a creditor with the requested information if their request is 'reasonable', the information is relevant to the liquidation, and the provision of the information would not cause the liquidator to breach their duties.
A liquidator must provide this information to a creditor within 5 business days of receiving the request, unless a longer period is agreed. If, due to the nature of the information requested, the liquidator requires more time to comply with the request, they can extend the period by notifying the creditor in writing.
Requests must be reasonable.
They are not reasonable if:
Both meetings and information:
(a) complying with the request would prejudice the interests of one or more creditors or a third party
(b) there is not sufficient available property to comply with the request
(c) the request is vexatious
Meeting requests only:
(d) a meeting of creditors dealing with the same matters has been held, or will be held within 15 business days
Information requests only:
(e) the information requested would be privileged from production in legal proceedings
(f) disclosure would found an action for breach of confidence
(g) the information has already been provided
(h) the information is required to be provided under law within 20 business days of the request
If a request is not reasonable due to (b), (d), (g) or (h) above, the liquidator must comply with the request if the creditor meets the cost of complying with the request.
Otherwise, a liquidator must inform a creditor if their meeting or information request is not reasonable and the reason why.
ARITA Level 5, 191 Clarence Street, Sydney NSW 2000 Australia I GPO Box 4340, Sydney NSW 2001 t +61 2 8004 4344 I e [email protected] I arita.com.au
AUSTRALIAN RESTRUCTURING INSOLVENCY & TURNAROUND ASSOCIATION
Meeting request Information and notice Resolution at meeting
ARITA
Right to give directions to liquidator
Creditors, by resolution, may give a liquidator directions in relation to a liquidation. A liquidator must have regard to these directions, but is not required to comply with the directions.
If a liquidator chooses not to comply with a direction given by a resolution of the creditors, they must document their reasons.
An individual creditor cannot provide a direction to a liquidator.
Right to appoint a reviewing liquidator
Creditors, by resolution, may appoint a reviewing liquidator to review a liquidator's remuneration or a cost or expense incurred in a liquidation. The review is limited to:
remuneration approved within the six months prior to the appointment of the reviewing liquidator, and expenses incurred in the 12 months prior to the appointment of the reviewing liquidator.
The cost of the reviewing liquidator is paid from the assets of the liquidation, in priority to creditor claims.
An individual creditor can appoint a reviewing liquidator with the liquidator's consent, however the cost of this reviewing liquidator must be met personally by the creditor making the appointment.
Right to replace liquidator
Creditors, by resolution, have the right to remove a liquidator and appoint another registered liquidator.
For this to happen, there are certain requirements that must be complied with:
If creditors pass a resolution to remove a liquidator, that person ceases to be liquidator once creditors pass a resolution to appoint another registered liquidator.
A meeting must be reasonably requested by the required number of creditors.
Creditors must determine who they wish to act as the new liquidator (this person must be a registered liquidator) and obtain:
Creditors must inform the existing liquidator of the purpose of the request for the meeting.
• Consent to Act, and • Declaration of
Independence, Relevant Relationships and Indemnities (DIRRI).
The existing liquidator will send a notice of the meeting to all creditors with this information.
For more information, go to www.arita.com.au/creditors
Version: July 2017
12112 (LIQ) - INFO - CREDITOR RIGHTS INFORMATION SHEET V1_0 DOCX
AUSTRALIAN RESTRUCTURING INSOLVENCY & TURNAROUND ASSOCIATION
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