The rumours have been circulating for the last month, but it is now official, the insolvent trading moratorium for directors and statutory demand protections will be extended to 31 December 2020. Here is today’s media release from The Hon Josh Frydenberg, Commonwealth Treasurer.
It is important for small business owners not to fall into the trap of thinking that these temporary measures provide an ‘umbrella’ of protection for all offences.
In my opinion, the extension of these protections may not promote good business practice for some and will only serve to further extend the life of businesses that are not viable.
The fiduciary duties of a director are not waived during this period of temporary protection and the statutory obligations of a director, to continue to act with due care and diligence and in good faith remain.
If you are a business owner or have small business clients that are experiencing financial distress, please contact one of the professional staff at BCR Advisory who are available to help.