What does voluntary administration look like?

I wrote earlier this week about Mentor Educations fate under the hands of an administrator and it all comes down to Credit Management. The “business for sale ad” touts that they earned $5M in revenue but they appear to have a cashflow management issue. Should someone have completed EzyLearn’s Credit Management Course?

This is quite a serious matter for existing students and it is a good case study example about important steps that every business needs to take if they are giving credit. It appears that one or more of Mentor Education’s creditors did have good credit management procedures in place..

When I read the announcement at ASIC regarding Mentor Education going into Voluntary Administration it appeared that someone had a registered interest to make this happen. Here’s the wording from the notification.

under section 436C, a person entitled to enforce a security interest in the whole, or substantially the whole of the property of the Company

ASIC website

This shows that one of the company’s creditors must have had a registered reservation of title or something similar to be able to force Mentor Education to take this action.

This is classic good Credit Management and one of the topics we take students through in our Credit Management Course.

I did a Google search for Gideon Rathner and the first page that came up was an article on their website, which can also be downloaded as a PDF and it covers these topics specifically.

Times are tough, protect yourself

I was speaking with Belinda, a member of our Bookkeeping Academy, who has completed our Credit Management course and she mentioned that she currently has a lot on her plate because she looks after accounts receivable tasks where she works.

She’s also implementing some of the things she’s learnt to help her employer improve their credit management procedures.

Download the Announcement of Voluntary Administration for Mentor Education.

If you are a student of Credit Management this is a great example. What happens next?

• Will they change the person managing the business?
• Will the creditor reduce their demands?
• Will a new buyer be found who will take on the debt that is owing?
• Will Mentor Education be able to secure a loan based on the value of the Intellectual Property they are currently promoting for sale and pay their creditors?

What can you do?

If you are a Mentor Education student please contact us and learn some bookkeeping skills by learning how to use MYOB and Xero.

Industry-Endorsed Short Courses in MYOB & Xero can give you the skills and confidence to apply for accounts jobs as well as perform better in your current job and they are usually much cheaper than accredited courses.