March 2008
Part 4 Other agents
32.3.41 Employment of accountants
(Amended February 2014)
The official receiver may employ accountants to assist in the preparation of a statement of affairs and/or accounts [Note 1][Note 2][Note 3][Note 4][Note 5]. This is dealt with in Chapter 12 Part 6 (Allowance towards expenses). Accountants may also be employed for other reasons, e.g. to assist in possible tax recoveries. The nature of the employment and the costs should be agreed, in advance and confirmed in writing, with the accountant. The official receiver should follow the advice provided in paragraph 32.1.10 and obtain the agreement of Technical Section, if appropriate, before employing an accountant. The agreed costs should be paid without delay once the account is submitted for payment. If the costs of employing an accountant are incurred for enforcement purposes then the charge should be made to Vote, against the official receiver’s enforcement budget, or Legal Services Directorate as appropriate. The official receiver should refer to the Finance Handbook on the intranet intranet/.../FianceHandbookHome.htm) for the correct cost centre code and account codes (previously ledger headings) to be used in relation to such charges.
The employment should be noted on LOIS (CA08) and in the record of handover to an insolvency practitioner liquidator or trustee (form IPROH) as should the subsequent payment of the accountants charges, the latter of which should be in accordance with Chapter 32.1 generally and paragraph 32.1.13 specifically.
32.3.42 Employment of computer bureau
Where the official receiver is in receipt of an insolvent’s computers and computerised records, reference should be made to the services provided by the Forensic Computing Unit for obtaining hard copy print outs etc. as detailed in Chapter 66. It should not be necessary to employ a third party agent such as an external computer bureau to obtain downloads of information.
Reference should be made to Chapter 62, paragraphs 62.19 and 62.20 regarding payment of wages and adequate insurance which must be considered by a special manager when engaging employees. The official receiver should have regard to the same matters when employees are to be engaged. Employees could include company officers.
32.3.44 Employment of bankrupt when official receiver is receiver and manager
If the official receiver is receiver and manager the bankrupt may be employed to protect the assets without the permission of the court [Note 6]. The official receiver should avoid employing the bankrupt in relation to his/her affairs except where there is no practical alternative, e.g. where there are matters which, if left unattended, would cause public concern, such as animals left unfed. The bankrupt should be requested to act for the official receiver without payment but he/she may, if necessary, be employed on a paid basis for a short time until other arrangements can be made. If payment is to be made the fees should be agreed in advance of the employment. If continuance of the business is necessary by the official receiver as receiver and manager, a special manager should usually be appointed (see Chapter 32.4). Where a bankrupt is employed by the official receiver (even though a special manager has not been appointed) due regard should be given to Chapter 32.4 relating to payment of wages and adequate insurance. The official receiver should exercise care that, by engaging the bankrupt, the security of the assets will not be at risk.
32.3.45 Employment of bankrupt when official receiver is trustee
If it is necessary for the official receiver as trustee to employ the bankrupt to continue the business, and no special manager has been appointed, permission of the Secretary of State acting on behalf of the creditors’ committee, (Technical Section), but more usually the court, must first be obtained [Note 7]. Details of, and reasons for, the employment must be provided and regard must be given to the matters to be considered as outlined in paragraph 32.3.46.
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