7 September 2023

Bringing businesses back from the brink: the real role of Canberra's newest liquidator

| Dione David
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Frank Lopilato and Adam Cormack at RSM offices in Canberra

RSM in Canberra partner Frank Lopilato with Adam Cormack, a senior manager who has become one of three registered liquidators at RSM Canberra. Photo: Ben Calvert.

If you have Grim Reaper notions of the role of a liquidator, chances are you haven’t met Adam Cormack.

“Anecdotally, I think there’s a common misconception that liquidators only act as quasi-morticians for businesses, or that business owners only come to liquidators when there is no hope or life left in the business,” he says.

“The reality is quite the opposite.”

The ultimate goal for a liquidator is to get the best financial outcome for a troubled business and its creditors.

This often means restructuring the business to make it sustainable and profitable, and identifying opportunities to return it to profit. Winding up the company’s affairs, selling off its assets to ensure creditors receive the largest distribution possible, is hopefully the last resort.

“It’s not all doom and gloom. Early intervention provides opportunities to help turn a business around and return it to operations and back under an owner’s stewardship; that’s always where my mind goes first,” Adam says.

“We even assist government departments and banks as well as business owners to navigate through difficult times.”

READ ALSO Why are so many Canberra businesses folding at the moment?

Adam recently became one of 10 registered liquidators in Canberra and at 31, the youngest. He is one of three at RSM in Canberra.

Qualification requires applicants to provide evidence spanning at least five years of a minimum of 4000 hours of relevant experience at a senior level. Applicants are also required to be a chartered accountant or equivalent, obtain post-graduate certification from the Australian Restructuring Insolvency and Turnaround Association program and undergo an “intense” panel interview with ASIC.

“It tested you on everything from matters you’ve worked on to confirm you’re at a sufficiently senior level as well as technical knowledge and problem solving,” Adam says.

“Yeah, the qualification process is rigorous, as it should be.”

Senior management at RSM gather in the Canberra offices

Adam Cormack (far right) joined the team at RSM in Canberra as a graduate in 2012. Photo: Ben Calvert.

Over the years Adam has been involved in every version of the role, assisting directors or stakeholders with workarounds so they could avoid disaster, negotiating with creditors so businesses could avoid the formal routes of insolvency and, of course, managing cases where companies entered into administration, voluntary and otherwise.

Where a business’ relationships with creditors have broken down, debt has become unmanageable and the company has effectively ceased operations, he has assisted with selling businesses as a whole or realising assets piecemeal to minimise the damaging effects of insolvency on creditors.

The job that has stuck with him most, however, was the one that almost caused him to miss his own wedding. It happened while he was winding down a goldmine in remote South Australia.

“The irony of a literal goldmine going into receivership is not lost on me,” he says.

The location was so remote, visitors had to charter a private jet to get in and out.

Days before the wedding as he wrapped up business, rain started to bucket down and the airstrip, little more than a short stretch of dirt, became too waterlogged to accommodate a safe take-off.

“I was panicking slightly. I was meant to be flying to Fiji for our destination wedding two days later. So I’m making a Plan B to drive the 750 km to Adelaide to then catch a flight back to Canberra to make the flight to Fiji, and I’m on the phone to my then fiancée, now wife, asking her to pack for me, because we were cutting it so fine,” he says.

As it turned out the airstrip dried sufficiently for take-off, and he enjoyed a beautiful Fijian wedding.

“Following the closure of that mine, we were able to return significant funds to a secure creditor who was owed a lot of money from investing in that mine. But that’s not why the job has stuck with me all these years,” Adam laughs.

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There have also been plenty of good news stories. Closer to home, he remembers assisting a registered Canberra charity –incorporated to provide affordable primary health care to disadvantaged community members – achieve financial sustainability.

After six months of consulting with the board to ensure RSM’s recommendations were implemented effectively, the restructuring plan secured additional grant funding from the local government and substantial debt forgiveness, improving the financial position by more than $500,000.

It’s not always an easy gig, but some people are built for it. Some even love it. Adam is one of them.

“There’s a reason I have been doing this now more than a decade,” he says.

“Being able to help people come back from the brink, guiding directors of businesses in financial distress, getting exposure to a number of different industries and effectively trading companies out of the difficult circumstances they find themselves in is rewarding work.”

For more information contact RSM in Canberra.


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