Corporations Act 2001

SCHEDULE 2 - INSOLVENCY PRACTICE SCHEDULE (CORPORATIONS)  

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Note: See section 600K .

PART 3 - GENERAL RULES RELATING TO EXTERNAL ADMINISTRATIONS  

Division 65 - Funds handling  

SECTION 65-1   SIMPLIFIED OUTLINE OF THIS DIVISION  

The external administrator of a company has duties to:

  • (a) promptly pay all company money into an account (called an administration account); and
  • (b) promptly deposit instruments such as securities with a bank; and
  • (c) keep the account separate and not pay any money that is not company money into the account; and
  • (d) only pay money out of the account if it is for a legitimate purpose.

    • The external administrator of a company may keep a single account for a group of related companies (called a pooled group).

    People with a financial interest in the external administration of a company (such as creditors) may ask the Court to give directions to the external administrator about the way money and other property of the company is to be handled.

    If the external administrator of a company does not comply with this Division, the external administrator may have to pay penalties, be paid less remuneration or be removed as external administrator.

     

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