How to Qualify as an Insolvency Practitioner

Posted: 28th of March 2019 by Lewis Scott

An insolvency practitioner…what is that you may ask?

Insolvency practitioners often get bad press as professionals who make money out of bust businesses or bankrupt individuals, but this is a bit unfair.  In many cases they are the saviours of a business and the people that owe or are owed money.  If a company goes bust then it is vital that as much value as possible is saved and everyone is fairly treated. 

 

So, an IP is a trouble shooter, dealmaker, detective and financial wiz all rolled in one.  Consequently, it is a well-paid profession in line with lawyers and accountants.  They have the task of handling assets and funds, negotiating deals, investigating business viability and restructuring. This is important as only licenced insolvency practitioners have the authority to take appointments and be supervisors of insolvency procedures.  They are officers of the court and have big responsibilities. For instance; If an IP is appointed as an administrator of a company they are personally in charge of all aspects of the business and they have personal control of the money going in and out. They even have to have special insurance taken out in case they run off with the money!

 

Due to the high regulation within this industry practise, many aspects of law tend to be intertwined to the daily job role. IPs must therefore have excellent law knowledge, as well as insolvency training and practise.  The work they do is mostly governed by the Insolvency Act 1986.

 

To become an insolvency practitioner, you would be surprised…it is not obligatory for you to attend University! So, what is required?

 

  • Passing the Joint Insolvency Examination Board exams

    Once a year, typically in November, a set of exams must be sat (not necessarily at the same time) and complete.  The two, three and a half hour long papers cover ‘’Corporate Insolvency’’ and ‘’Personal Insolvency’’.  

    It is said that the exams are hard – so prepare, revise and work hard! 

    To take the exams, you must register with the recognised professional body. These include:
  • The Association of Chartered Certified Accountants (ACCA)
  • Insolvency Practitioners Association (IPA)
  • The Institute of Chartered Accountants In England and Wales (ICAEW)
  • The Institute of Chartered Accountants in Scotland (ICAS)
  • The Institute of Chartered Accountants in Ireland (ICAI)
  • The Solicitors Regulation Authority (SRA) for the Law Society of England and Wales
  • The Law Society of Scotland
  • The Law Society of Northern Ireland

     
  • Having a minimum of 600 hours of work, experienced in an authorised insolvency practice, over the past three years.  You can get this experience by being an insolvency administrator which is basically running cases, liaising with directors/individuals and creditors and compiling reports.  Examples of jobs can be shown here https://www.indeed.co.uk/Insolvency-Administrator-jobs-in-London


    So long that you pass the JIEB exams and have the necessary experience, you become a qualified IP. A licence should then be applied for.

 

  • The Certificate of Proficiency in Insolvency

If you wish to not become a licenced insolvency practitioner, but work full time in insolvency, then this can be gained. The IPA conduct an exam to reach this. It is a lower level, simpler test, held in June, compromising a single three-hour paper. 40% refers to multiple choice questions, with 60% essay style. There is a mix of both personal (one thirds worth) and corporate insolvency (two thirds worth) aspects within.  You must be a registered IPA student for this.

  • University

Of course, if you did want to go to university…you can do. Generally, Law, Accounting and Finance degrees, are related – though it is not obligatory or limited to these.

Going to University and gaining such a degree, does not disregard you from taking the JIEB exams or obtaining the Certificate of Proficiency in Insolvency, to further progress into the role.

  • Starter courses

To be involved in the insolvency world, there are existing providers of related courses and qualifications. These ensure to prepare you and give you insight into IP life. It is recommended to look into these and get knowledge beforehand. Having a basic ‘tester’ course can open your eyes to the IP working ways and methods, to see if the career is fit for you.

 

Rebecca Dunne, the author, is a University of Hertfordshire Management Undergraduate and the freelance writer for KSA Group, who are Licensed Insolvency Practitioners in the UK, established in 2000.  KSA Group run www.companyrescue.co.uk which contains over 2000 pages of useful information for struggling businesses.

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