December Sentinel 2023

Happy Holidays Everyone!

The festive season is now well and truly here and in the countdown to Christmas it’s tough to find the time to work ‘on’, rather than ‘in’ our businesses.? Nevertheless, starting to get your head into that space and setting aside some time early in the new year for that discussion - even if it’s just with yourself - is vital.

In our last 2023 issue of Sentinel we take a look back at 2023 and ponder what’s ahead for 2024, especially focussed on mitigating the risk of winding up on the wrong side of a winding up.? We look at some of our wins and losses for 2023 and cast our minds forward to changes in the way we imagine our practice in an ever-changing and unpredictable world, with a view towards a significant announcement about our practice in the New Year.

Thank you for being a part of our Sentinel family in 2024 and we look forward to hearing your stories as 2024 unfolds.

For now, rest, recover, revel and rejoice (and then recover some more)!

Tony Lane CA RITP

Editorial

Hands up everyone who expected that kind of 2023!?!

It certainly was an eventful year.? It saw the inexorable march of interest rates which,? coupled with inflation, startled more than just a generation of young people that had never understood a mortgage interest rate with more than a 2 in front of it.? Yet property prices still rise on the back of undiminished demand and whilst the ‘mortgage cliff’ is not yet here, something tells me that the fall may not be as long and the landing far softer than some in the financial media would lead us to believe.

For the time being, the RBA seems done with rate rises and most leading economists are no longer predicting any - in fact some are now espousing a rate cut in mid/late 2024.? Wouldn’t that be something to see!?!

Closer to home however, we have been staying close to our referrer base and asking them for market intel - all of you are at the coalface and it’s through you that we get to understand what’s really going on out there.? The common response is “it’s still tough and we’re not out of the woods yet!”? That is certainly true for all discretionary spend exposed industries - particularly hospitality and retail.? The Australian Retailers Association has been managing expectations in the market since late October and is foreshadowing a pessimistic performance from retail not only over the holidays, but into 2024.? The Australian Hotels Association is similarly glum.

So with that in mind, this month I have put pen to paper and set out some thoughts about how to avoid becoming a creditor in a winding up.? There are some simple strategies to apply - particularly about the new industry buzzcronym ‘KYC’ - know your client.? If you’re not running a CRM and gathering information about your clients then you are behind your competitors - perhaps even setting yourself up for a fall…

On the optimistic side though, 2024, like every year I suppose, is one of opportunity.? As a practice we are fundamentally changing the way we interact with referred clients and have begun the implementation of new systems and processes that will lead to what we believe will be an Australian first in insolvency practice.? Adding to that, we will be expanding our team in 2024 to a total of 9 across our two offices in Canberra and Melbourne, and our remote site in the Philippines.? We are proud of what we’ve been able to achieve in just two and a half short years!

In saying that, our direction is also guided by you.? What would you like to see us do more of or less of in 2024?? What should we start doing or stop doing to make what we deliver and how we deliver it better for you?? Connect with us via our socials and please let us know what you think.

Until then, stay on the ‘nice list’ and have a safe,? happy and relaxing holiday season!

Tony, Matt and the entire Beacon Advisory Team

Tony Lane CA RITP

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2023 - a retrospective

2023 was certainly one out of the box.? It started quickly and then shuddered to an almost standstill in mid April when appointments and new work seemed to slow considerably.? Winter allowed us to do some much needed work on legacy matters and resolve a path to completion of some older work.

2023 also saw us deliver on one of our most proudly-held pieces of work - the relaunch of a financially stable ZigZag Railway.? As a consulting engagement spanning almost 2 years, it was a significant achievement for our project team to see a business that almost succumbed to fires, emerge as a ‘true’ phoenix to once again deliver on its promise - ‘to show the world the magic, power and beauty of steam’.

So, with 2023 almost in the rear-view mirror, here’s our take on the wins and losses of 2023.

WINS

• Falling inflation - for some time inflation seemed as though it would remain stubbornly high, but it appears the worst is behind us and although cost of living pressures will take longer to abate, it could have been a whole lot worse!
• The Zig Zag Railway - what a remarkable achievement by their dedicated team of volunteers, their senior management team and their Board.? A national icon is preserved!
• The Federal Circuit and Family Court of Australia - despite cynicism about the functioning of the combined Courts, we experienced the benefits the Court can bring to resolving corporations matters under its original jurisdiction in the Corporations Act 2001 - a settlement in our favour for $170,000!
• The ‘PJC’ - the Parliamentary Joint Committee on Corporations and Financial Services (to give it its full title) - handed down a comprehensive report after almost 12 months of inquiry. Significant recommendations for teh reform of insolvency law, practice and conduct emerged and we look forward to seeing those unfold in 2024 and beyond.
• Our Melbourne Office - under the expert guidance of Beacon Advisory Principal Matthew Moldrich, our Collins St, Melbourne office is now staffed and a fully-functioning part of our business.? Matt continues to drive enquiries and the growth of that part of our practice.
• Our Canberra Office - moved from strength to strength this year as Tash Jayasekara saw out her probation period with aplomb and secured a promotion from Graduate to Intermediate - all within her first 12 months with the firm.? 2023 also saw us consolidate our footprint with the taking of additional space at our AMP Building premises in preparation for 2024 hires!
• Over 25 new matters - our sincere thanks to our trusted referrers who sent over 25 new matters our way in 2023.? Whilst that may not seem like a large number, for a small and efficient practice it is our lifeblood.

LOSSES

• 2023 saw us lose one of our excellent junior staff in Jemie De Leon.? Jemie has moved to the USA to take up a new role in finance.
• The Federal Circuit and Family Court of Australia - we also saw the downside of the operation of this Court where, in the same matter as referred to above, we made a successful application for orders granting leave to examine parties to a family law matter, and in doing so encountered a costs order - against us!? Sometimes, when you win, you lose.
• During 2023 we said goodbye to:37 businesses - some managed out, some solvent windings up, but most succumbed to insolvency;A total of 332 employees who lost their jobs as a direct result of those insolvencies;A total of 1226 creditors owed in excess of $13.2 million resulting from those insolvencies;A total of 2,448 pieces of paper sent from our office relating to those insolvency matters; and

Like you, we hope our 2024 contains more wins and less losses.

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About Beacon Advisory

After three decades in the insolvency and financial services fields, we established Beacon Advisory in May 2021. At Beacon Advisory we deploy traditional insolvency and business advisory services in non-traditional ways through enhanced use of technology, innovation and strategy, underpinned by our delivery philosophy of creativity, collaboration and objectivity. We utilise our significant experience and unparalleled expertise to provide tailored solutions driven by our core principles of quality, integrity and timeliness so that our clients can move forward with trust, in our abilities and their own, towards a brighter future.

Disclaimer:

This newsletter is not intended to provide professional advice but rather general information only. You cannot rely on the content of this newsletter without proper advice in the context of your own circumstances. If you have specific concerns, please consult a professional who can provide advice tailored to your individual circumstances.