Consumer insolvency in Australia

This paper seeks to identify and assess the features of Australian bankruptcy regulation as they apply to consumer insolvency. Although Australian bankruptcy law makes no explicit recognition of ‘consumer bankruptcy’ as a regulatory target in itself, the Australian legislation nevertheless has a number of features that impact on what would generally be seen to be consumer bankrupts. After providing an outline of the legislative framework within which consumer bankruptcy operates, the paper examines the consumer insolvency aspects of this legislation, together with an assessment of proposed reforms. Some brief comparisons of the ‘consumer’ features of Australian regulation with that of the more fully developed consumer provisions of the Canadian and the United States bankruptcy legislation, are made in order to highlight the Australian position. The Australian Act has historically drawn heavily on English bankruptcy legislation but inevitably Australia has to some extent developed along its own path. Notable is the reasonably vigorous approach to discharge from bankruptcy. The proposed reforms to the Bankruptcy Act, which have followed a detailed consultative process, are largely directed to consumer debtors. Some of these reforms are directed against a perceived debtor abuse of the bankruptcy system. Other reforms, such as increasing the availability of debt agreements, are more generous to insolvent debtors. On the whole the reforms appear to be based more on political than empirical grounds.     

注册会计师如何做好破产管理人

新破产法创建了专业化、市场化的管理人制度,规定管理人可以由有关部门、机构的人员组成的清算组或者依法设立的律师事务所、会计师事务所、破产清算事务所等社会中介机构担任。管理人制度的建立,为会计师事务所和注册会计师增加了一项法定业务。担任管理人将会成为会计师事务所新的业务增长点,注册会计师行业在社会主义市场经济体制运行中的地位将得到进一步提升,这对注册会计师行业做大做强和国际化发展具有重大意义。本文拟通过实例分析,介绍笔者对注册会计师做好破产管理人的一些体会。     

The United Nations Convention on the Assignment of Receivables in International Trade: insolvency aspects

Breaking new ground, the UN Convention on the Assignment of Receivables in International Trade refers all priority conflicts with respect to receivables to the law of single and easily determinable jurisdiction, and one that is most likely going to be the insolvency jurisdiction, namely to the law of the assignor's place of business or, in the case of places of business in more than one State, the assignor's central administration. In the case of an insolvency proceeding in another jurisdiction, the mandatory rules of that juridiction displace any priority rule of the law of the assignor's location only if that priority rule is manifestly contrary to the public policy of that jurisdiction. In such a case, the balance of the priority rules of the law of the assignor's location prevails over the priority rules of the insolvency jurisdiction with the exception of rules relating to preferential rights. In any case, the Convention ensures that priority rules do not interfere with basic insolvency rights, such as those relating to stays, avoidance actions and to the performance of contracts or maintenance of the estate. Copyright © 2004 John Wiley & Sons, Ltd.     

The moral regulation of markets: Professions, privatization and the english insolvency act 1986

Both economists and sociologists in the last two decades have pointed to the variety of ways that markets require normative foundations and legitimation. In order to understand better how market morality is constructed through law, this paper examines how Mrs Thatcher's Conservative Government used the 1986 Insolvency Act to produce a reconstruction of market behavior. First, it championed privatization in the administration of bankruptcy and in corporate liquidation and reorganization. To do so required a clean-up of the “unacceptable face of capitalism.” It used the insolvency reforms to develop a moral code that distinguished among three types of commercial behavior — mistakes, recklessness, and criminal activity. Second, the Act attempted to “professionalize” some elements of business practice. It did so by developing codes that exposed reckless and criminal company directors to civil actions with strong punitive sanctions, including personal liability and disqualification from management. And third, the legislation created a new occupational monopoly of insolvency practitioners, which was charged with the monitoring of directors' behavior, and reporting recklesssness and the appearance of criminality to government enforcement agencies. The paper concludes that Mrs Thatcher's Government used the ideals and actuality of professionalization as an instrument to define and improve both market morality and efficiency. This linkage between professionalization and market rejuvenation further demonstrates how states may use professions as agents of economic surveillance and enforcers of commercial morality. It raises questions about the conditions under which states will exert their enormous leverage over licensing to compel professions to act as moral agents on the state's behalf.     

Insurer's insolvency risk and tax deductions for the individual's net losses

Using the representative agent approach as in Kaplow (Am Econ Rev 82:1013–1017, 1992b), this paper shows that providing tax deductions for the individual’s net losses is socially optimal when the insurer faces the risk of insolvency. We further show that the government should adopt a higher tax deduction rate for net losses when the insurer is insolvent than when the insurer is solvent. Thus, tax deductions for net losses could be used to provide an insurance for individuals against the insurer’s risk of insolvency. These findings could also be used to explain why a government provides supplementary public insurance or government relief. Finally, we discuss that, if the individuals are heterogeneous in terms of loss severity, loss probability, or income level, providing a tax deduction for the individual’s net losses may not always achieve a Pareto improvement, and cross subsidization should be taken into consideration.

The performance of insolvency prediction and credit risk models in the UK: A comparative study

Theoretically-driven, market-based contingent claims models have recently been applied to the field of corporate insolvency prediction in an attempt to provide the art with a theoretical methodology that has been lacking in the past. Limited studies have been carried out in order directly to compare the performance of these models with that of their accounting number-based counterparts. We use receiver operating characteristic curves to assess the efficacy of thirteen selected models using, for the first time, post-IFRS UK data; and investigate the distributional properties of model efficacy. We find that the efficacy of the models is generally less than that reported in the prior literature; but that the contingent claims models outperform models which use accounting numbers. We also obtain the counter-intuitive finding that predictions based on a single variable can be as efficient as those which are based on models which are far more complicated – in terms of variable variety and mathematical construction. Finally, we develop and test a naïve version of the down-and-out-call barrier option model for insolvency prediction and find that, despite its simple formulation, it performs favourably compared alongside other contingent claims models.