An investigation into the attitudes that exist among accounting and non-accounting business students towards innovation and creativity in the accountancy sector

Abstract

Since the recession began there has been a reduced credit flow in this country. As a result many companies have found themselves insolvent. For viable companies there is an option available called examinership. This process provides a company with court protection from its creditors for a limited period. During this period the company will receive new investment and restructure. This involves the company being given the opportunity to significantly reduce its debts. In return for the writing down of the company’s debts, their creditors will receive a dividend which is funded by this new investment. This legislation was enacted in 1990 to prevent the collapse of the Goodman group. This legislation was rushed into law and amendments had to be made in 1999 to rectify problematic issues with the original legislation. However many issues still remain with this legislation. It has been described by many as too expensive and inaccessible for small companies. This thesis aims to discover whether there is a need for reform of the current legislation. It is important in recessionary times that there is an appropriate mechanism in place to help viable companies in financial difficulty to survive. This will aid in the recovery of the economy and the protection of jobs. This thesis will investigate the issues associated with the current examinership process and also how these issues may be rectified. Practitioners in this area were asked to give their opinions on the issues identified and also if they could suggest any further improvements to this process.

The research found that there may not be a need for reform; however there are minor amendments that may be required. Such as a further extension to the period of court protection for large and more complex companies. The research discovered that judges consider the number of employees a company has when deciding on a company’s application for examinership even though this is not outlined in the legislation. This should not be a factor as every job is important and every job saved could save the government €14,000 per annum. Additionally the legislation makes it impossible for SME’s to enter the process due to the high costs. Holding cases in the Circuit Court would significantly reduce these costs and make the process accessible to SME’s. This research also found that the current alternatives are inadequate and can be only used in certain circumstances.