In short
The short answer
Voluntary administration pauses most creditor action while an independent administrator assesses the company’s options. Liquidation winds the company up through a registered liquidator.
Both processes are run by a registered liquidator with duties to creditors. Directors keep their own duties, including the duty to prevent insolvent trading.
Australian Financial Advisory explains what each process means for you, sets out the options in writing, and introduces a registered insolvency practitioner. We do not act as the administrator or liquidator.
What we do
We help you understand your position before committing to anything
Situation assessment
We review your business and financial position, your creditor exposure, and the realistic options available to you, including which formal pathways are still open.
Director obligations explained
We explain your obligations as a director during each process, including insolvent trading exposure, reporting duties, and what you must and must not do while the pressure continues.
Written report with a recommended pathway
We issue a written report with a recommended pathway and the next steps required, so you go into any formal process with your eyes open.
Specialist referral
We refer you to a registered insolvency practitioner in our network to carry out the process you choose.
The processes
What each process means for a director
Voluntary administration
Voluntary administration pauses most creditor action, including legal proceedings, while an external administrator assesses the options available to the business.
The outcome may be a restructured business through a Deed of Company Arrangement (DOCA), a return of the company to its directors, or an orderly wind-down. The key word is voluntary: the directors choose to start the process.
Acting voluntarily gives a director more involvement than waiting for a creditor to apply to wind up the company through the courts.
What happens when a liquidator is appointed
If the company needs to be wound up, understanding the process before it starts matters.
A liquidator’s duties are to the creditors and the court, regardless of who nominates them. That includes investigating the conduct of the directors.
Taking advice before any appointment means you go in understanding the process, your obligations and what to expect.
Director duties during insolvency are serious, including potential personal liability for insolvent trading. The sooner you take advice, the better you understand your position.
Acting before a creditor applies to wind up the company keeps more options open.
Director duties
Insolvent trading, continuing to incur debts when the company cannot pay them, is a personal liability risk for directors.
The sooner you take independent advice, the better you understand that exposure and your options.
We help you understand exactly where you stand before any formal process begins, so you make decisions with full knowledge of your obligations.
Our role
What Australian Financial Advisory can and cannot do
We can
- Assess your position and explain which formal pathways are still open.
- Explain your duties as a director during administration or liquidation.
- Set out the options and a recommended pathway in writing.
- Introduce a registered insolvency practitioner from our network.
We do not
- Act as the administrator or liquidator, or accept an appointment of any kind.
- Give legal advice or determine whether the company is solvent or insolvent. We can prepare a cash-flow projection from your figures.
- Promise a particular outcome. Outcomes vary case by case.
Common questions
Administration and liquidation questions
Is Australian Financial Advisory a registered insolvency practitioner?
No. We're an assessment-and-referral service. Where formal insolvency work is needed, we refer to appropriately licensed practitioners.
Who appoints the administrator or liquidator?
In a voluntary administration or a creditors voluntary liquidation the directors or members resolve to appoint a registered liquidator. A creditor can also apply to the court to wind up a company. In every case the practitioner is a registered liquidator with duties to creditors.
Do you charge for the first conversation?
No, the initial consultation is free.
The information on this page is general in nature and does not constitute legal, financial, taxation, or insolvency advice. Australian Financial Advisory Pty Ltd provides assessment and advisory services only. All specialist services are referred to appropriately licensed partners. You should seek independent professional advice before acting on any information on this page.
Content last updated: 2 October 2026.
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The earlier you act, the more options may still be open. Tell us a little about your situation and we will be in touch to arrange a time.
What the free initial consultation covers
- A confidential first conversation to understand your situation and confirm whether we can help.
- The initial consultation is free. There is no cost and no obligation.
- Standard professional confidentiality applies.
- If we're not the right fit, we'll say so on that call.
- Any next step is your decision. We don't push a particular outcome.