For the Salem businesses that we here at The Law Office of Paul Petrillo work with, one of the most important tasks associated with their impending bankruptcies is obtaining reliable and accurate valuations of their business assets. If you and your company are currently going through this process, then you may be waiting for the court of appoint someone to perform your valuation. Remember, though, that the court’s primary objective is processing your case, and not ensuring that you get the best valuation for those assets that you may be relying upon going forward in your bankruptcy proceedings.
The CBIZ Valuation Group lists certain circumstances under which you may want to handle your own asset valuation prior to bankruptcy rather than leaving it to the court. These include:
- To accurately determine if claims are secured: Except for a few exceptions, secured claims are not discharged in bankruptcy. Therefore, if a creditor has a lien against one of your assets, you will want to know if that asset has any value to help determine if you may want to liquidate it in order to settle the debt.
- To support your reorganization plan: Your ability to reorganize your business through a Chapter 11 bankruptcy depends on the court and your creditors accepting your reorganization plan. Having your own asset valuation done may be taken as confirmation that you are acting in good faith.
- To get top dollar for assets you want to sell going forward: You may need to sell assets to help sustain your operations as you work through your bankruptcy. Having your own valuation done may give you the best chance at getting the most out of them.
You can find further information on preparing for your business’ bankruptcy by continuing to browse through our site.