Updates Required for Business Rescue Status Reports
The Companies and Intellectual Property Commission (CIPC) issued Practice Note 2 of 2024 on the reporting requirements for business rescue proceedings under section 132(3)(a-b) of the Companies Act. CIPC has noted that business rescue reports often not presented in the correct format and do not follow required procedures.
To make it simpler to comply, the following requirements are included in the practice note.
If a company is in business rescue for longer than three months, the practitioner must:
Prepare Progress Reports: Business rescue practitioners need to report on the progress of the rescue proceedings, including creditor meetings, investigation outcomes, and actions taken. The initial report must cover details like the date of the rescue plan publication and any ongoing matters.
Monthly Updates: After the first report, updates should be submitted monthly. These updates should cover progress on the plan's implementation, with specific actions taken and percentage completion rates. There’s no need to repeat earlier reported dates like the initial meeting or appointment dates.
The CIPC has also noted that many entities remain in business rescue for years without adopting a plan. Practitioners managing these cases may face inquiries from the Commission regarding the delays.
Stay compliant by following these guidelines to ensure your business rescue status reports meet the requirements.
