Insolvency and Antecedent Transactions

Forensic analysis for
insolvency proceedings.

Key Ledgers provides independent forensic accounting analysis for officeholders, solicitors and Counsel in insolvency and antecedent transaction disputes.

PreferencesTransactions at UndervalueMisfeasanceAsset Recovery

Case Study

Real instruction - name withheld

Insolvency Asset Trace

Instructed to trace misapplied funds across a group of related entities following the appointment of a liquidator. The accounting records were incomplete and required reconstruction from bank statements and third-party documentation. The resulting analysis identified preferential payments and transactions at undervalue, forming the basis of the officeholder's recovery action.

Recovery action supported by forensic analysis

"In insolvency, the financial history of the company is often the most contested part of the proceedings. The records rarely tell the full story."

How We Work

How does forensic accounting support insolvency proceedings?

Transaction Review

We analyse the company's financial history, typically covering the two years prior to insolvency. We identify payments, asset transfers and inter-company dealings that may constitute antecedent transactions under the Insolvency Act 1986 and related legislation.

Classification and Quantification

Each transaction is assessed against the statutory criteria for preferences, transactions at undervalue, extortionate credit transactions and misfeasance. We quantify the potential recovery value of each identified transaction and the strength of the evidential position.

Officeholder Support

We produce expert evidence, clear schedules and narrative analysis to support the officeholder's recovery action. We assist at all stages from initial investigation through to court proceedings, and are available to attend advocates meetings and give oral evidence where required.

150+Expert Witness Instructions

20+Years in Practice

FCCAFellow of ACCA

CPR 35Court-Qualified Expert

Why Key Ledgers

What makes the
critical difference.

Insolvency proceedings require a forensic accountant who can reconstruct incomplete records, classify transactions under the Insolvency Act 1986 and present clear evidence in support of recovery actions.

Genuine Independence

We act for officeholders, solicitors and Counsel. Our analysis is independent and formed on the evidence, without allegiance to any party in the proceedings.

CPR Part 35 Qualified

All expert reports comply with CPR Part 35 and the Insolvency Rules. Our evidence is structured for use in both court proceedings and pre-action negotiations.

FCCA and Registered Auditor

Bharat Varsani FCCA is a Fellow of ACCA and a registered auditor, with the professional standing that commands credibility in court proceedings.

Court Experience

Instructed in recovery actions, misfeasance proceedings and wrongful trading claims across the County Court and High Court.

Incomplete Records Specialist

Insolvency instructions frequently involve missing or destroyed records. We reconstruct from bank statements and third-party sources, documenting every gap.

Same Working Day Response

We respond to all enquiries the same working day. Instruction details are treated as strictly confidential from the first contact.

Who We Work With

Instructed by officeholders, solicitors and Counsel across the full spectrum of insolvency proceedings.

Insolvency Practitioners

Liquidators, administrators and trustees requiring forensic analysis of antecedent transactions and director conduct.

Solicitors for Officeholders

Solicitors advising officeholders in recovery actions, misfeasance proceedings and wrongful trading claims.

Commercial Counsel

Insolvency and restructuring barristers requiring expert forensic accounting evidence for hearings and trials.

Creditors and Lenders

Secured and unsecured creditors pursuing recovery through insolvency proceedings and director disqualification.

What You Receive

Evidence that supports the officeholder's recovery action at every stage.

Our insolvency work product gives officeholders and their solicitors the forensic foundation for pre-action correspondence, settlement and trial.

Transaction analysis schedules
Detailed schedules of all transactions in the review period, classified by type, cross-referenced to bank statements and company records.
Antecedent transaction assessment
Analysis of each identified transaction against the statutory criteria for preferences, transactions at undervalue and misfeasance, with recovery quantification.
Net deficiency analysis
A reconstruction of the company's financial position at key dates, supporting wrongful trading and misfeasance claims.
CPR Part 35 expert report
A properly structured expert report setting out our methodology, findings and opinion, compliant with CPR Part 35 and the Insolvency Rules.
Oral evidence and hearing support
Attendance at advocates meetings, joint expert statements and oral evidence at trial or hearing where the instruction requires it.

Common Questions

Frequently asked questions about insolvency and antecedent transactions.

An antecedent transaction is a financial transaction entered into by a company before it became insolvent that may be challenged by an insolvency officeholder. The main categories are preferences, transactions at undervalue, extortionate credit transactions and transactions defrauding creditors. The purpose of the challenge is to recover value for the general body of creditors.
A preference occurs when a company pays or provides security to a particular creditor in circumstances that put that creditor in a better position than they would have been in on a liquidation, where the company was influenced by a desire to prefer. A transaction at undervalue occurs when the company receives significantly less than the true value of what it gives, or makes a gift. Both are challengeable under the Insolvency Act 1986.
Misfeasance is a claim under section 212 of the Insolvency Act 1986 against a director or officer of a company for breach of fiduciary duty, misapplication of company assets or breach of the duties owed under the Companies Act 2006. A forensic accountant assists by quantifying the loss caused by the misfeasance and tracing assets that have been misapplied.
For preferences, the look-back period is generally six months before the onset of insolvency, extended to two years for transactions with connected persons. For transactions at undervalue, the period is two years for all counterparties. For transactions defrauding creditors under section 423, there is no fixed look-back period. We review the relevant period systematically and document each identified transaction.
Wrongful trading claims under section 214 of the Insolvency Act 1986 require the officeholder to establish the date from which a director knew or ought to have known that there was no reasonable prospect of avoiding insolvent liquidation. A forensic accountant analyses the company's financial position at various points in time, quantifies the net deficiency, and identifies when the financial position became irretrievable.