Company liquidation is the process ofclosing down a company. It is an event that usually occurs when a company has no money to pay its remaining debt. When the company operation ends, usually the organizational assets are distributed to creditors and shareholders, based on their priority of claims.
In general, the person who conducts the overall liquidation process is called liquidator. A liquidator is appointed by the court or the shareholders of the company, according to the type of liquidation.
Types of Liquidation
Company liquidation may be of the following two types:
1. Voluntary Liquidation
In case of voluntary liquidation, the shareholders of a company will decide to wind up the company as they have no money to pay for creditors. In this type of liquidation, priority is given to the creditors.
2. Compulsory Liquidation
Compulsory liquidation is a type of company liquidation which is put forward by court order. Here, the assets of the company are distributed to the creditors and contributors based on the priority of claims.
Role of a Liquidator
A liquidator is the chief decision maker in a liquidation process. The duties of a liquidator are as below:
1. Initiating the Winding-Up Process
Once the Board of Directors/Shareholders pass a resolution for the liquidation or winding up, and the appointment of liquidator, the liquidator, upon the receipt of such resolution, issues an acceptance letter.
2. Publishing the Liquidation Notice
Once the liquidation process is initiated, the liquidator publishes the liquidation notice, both in Arabic and English, in 2 local newspapers.
3. Overview of Collection & Distribution of Company Assets
If needed, the liquidator may overview the collection and distribution of company assets, and the settlement of liabilities.
4. Preparing the Statement of Affairs
As the last step in the liquidation process, the liquidator prepares the statement of affairs and the liquidator’s report.
Ogedengbe Blessing & CO Company Liquidation Services in Nigeria
We provide the following company liquidation services in Nigeria Assisting in preparing the Board of Directors/Shareholders’ resolution
- Auditing financial statements for the purpose of liquidation
- Preparing the Statement of Affairs and the Liquidator’s Report, including No Liability Letter
- Liaising with the licensing authorities for submission of documents and liquidation of the company
Why Ogedengbe Blessing & CO?
The liquidation of a company in Nigeria is a complex and time-consuming process. At Ogedengbe Blessing & CO , we help our clients in following the procedures to wind up a company in Nigeria, should the need arise. Ogedengbe Blessing & CO is a financial consultant in Nigeria, offering a wide range of services including accounting, auditing, software consultancy, and management. We have been providing the best audit services in Nigeria for over a decade.
For any company liquidation services in Nigeria, contact us – we’d be glad to assist.