An anonymised real-world turnaround guided by Parker Walsh and licensed insolvency practitioner Molly Monks F.I.P.A

Many directors believe that entering insolvency means the end of the line. In reality, the right advice at the right time can provide a structured exit from distress and a pathway to relaunch a stronger, stabilised business. This case study illustrates how a company facing severe financial pressure worked with Parker Walsh to restructure, exit unmanageable liabilities and restart with a sustainable future.

Background: When a Growing Business Hit a Wall

The business in this example referred to as “Company A”was a well-established service provider with 18 employees. After years of growth, the company was hit by rising supplier costs, HMRC arrears and a sudden loss of a major contract. Cash flow tightened, creditor pressure increased and directors began receiving daily payment demands.

The directors initially tried to trade out of difficulty, but mounting liabilities made recovery increasingly unlikely without specialist intervention.

Recognising the seriousness of the situation, the directors contacted Parker Walsh for support.

Initial Review With Molly Monks F.I.P.A

Company A met with Molly Monks F.I.P.A, licensed by the Insolvency Practitioners Association (IP No. 19830), founder of Parker Walsh and a member of both the Insolvency Practitioners Association and R3. With over two decades of restructuring experience, Molly quickly identified that the business was insolvent on a cash-flow basis and that trading in its current form would expose directors to personal risk.

Molly carried out a detailed assessment of:

• Cash flow position and upcoming liabilities

• HMRC arrears and enforcement activity

• Employee costs and contractual obligations

• Supplier relationships and essential business assets

Her analysis confirmed that a formal insolvency process combined with a restructuring strategy would provide the best outcome for all stakeholders.

Turning Point 1: Recognising Insolvency and Acting Early

The directors’ willingness to seek advice before HMRC enforcement escalated was a critical factor in achieving a positive outcome. Early action meant more options were still available.

Molly advised that continuing to trade without a viable plan could lead to personal exposure. The directors agreed that a controlled, compliant approach was essential.

Turning Point 2: Placing the Business into a Creditors’ Voluntary Liquidation (CVL)

The most suitable route was a Creditors’ Voluntary Liquidation (CVL). This allowed the distressed company to cease trading in an orderly manner while giving creditors a fair, transparent process.

Key benefits of the CVL included:

• Immediate stop to creditor pressure

• Protection for directors acting responsibly

• A structured valuation and disposal of non-essential assets

• Clear communication with employees and creditors

Parker Walsh handled the entire process directly—no brokers or intermediaries—ensuring the directors had a single, experienced point of contact throughout.

Turning Point 3: Planning a Sustainable Relaunch

While the insolvent company could not continue, the underlying business model remained viable. With proper restructuring, the directors could relaunch under a new trading entity without the burden of historic debt.

Molly guided the directors on:

• Legal restrictions around phoenix companies

• Ethical reuse of trading names

• What assets could be purchased through the liquidation process

• How to restructure operations to avoid the previous issues

• Creating tighter cash-flow controls and more robust financial oversight

The new entity purchased necessary equipment at fair value through the liquidator and restarted with a revised business plan and leaner cost base.

Turning Point 4: Stabilising, Rebuilding and Regaining Confidence

After relaunch, the business:

• Regained relationships with key customers

• Removed unmanageable historic debt

• Improved margins through renegotiated supplier terms

• Implemented stronger financial reporting

• Returned to steady profitability within months

Employees were rehired selectively based on operational needs, helping the business achieve a sustainable staffing model.

Lessons Learned

This case study highlights several important takeaways for directors facing similar challenges:

1. Early advice prevents crisis

2. Directors must recognise signs of insolvency

3. A CVL can provide a structured solution

4. Restarting ethically is possible when done correctly

5. Specialist guidance ensures compliance and protects directors

Conclusion

The journey from insolvency to restart is challenging, but with experienced guidance, it can lead to a stronger, more resilient business. Company A’s directors avoided greater financial damage, protected their employees as far as possible and relaunched with a sustainable structure.

As Molly Monks of Parker Walsh explains:
“Rescue isn’t always about saving the existing entity—it’s about saving the underlying business. With the right process and honest communication, directors can move from distress to stability with confidence.”

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