FAQs
Frequently asked questions for creditors
I supply the business, who do I need to speak to about ongoing supply?
Unfortunately following the appointment the business has ceased trading. Where ongoing supply is required, the team are reaching out to those suppliers. If you are unsure if supply is required post appointment please contact uk_koko_queries@pwc.com. Anything owing as at the date of appointment would rank as an unsecured claim in the administration (this is explained in further detail below).
I am owed money; what notification will I receive?
The officeholder will write to all known creditors of the Company (per the creditor list obtained from the Company's books and records) to formally notify them of the administration appointment. This will be accompanied by information on how to submit a claim and a general website notice informing creditors that most future documents for creditors will be posted to a website rather than being delivered by post.
What type of creditor am I?
Creditors can be further classified as to the type of claim they have, these types will determine the quantum of distribution they will receive as the funds for each type is ring fenced.
The three main types of creditor are:
- Secured (split into security via fixed/standard and floating charges);
- Preferential; and
- Unsecured
Secured creditors have security registered at Companies House. When they have a fixed/standard charge over an asset, the secured creditor will be paid out of the realisations from that specific asset, after the costs of realisation have been deducted. When they have a floating charge over an asset, the secured creditor will be paid out of the realisations from those assets, after the costs of realisation and other expenses of the insolvency procedure, the preferential creditors (see below) have been paid in full and the prescribed part (see below) has been set aside.
Preferential creditors primarily consist of employees for arrears of wages, accrued holiday pay, unpaid contributions to occupational pension schemes and state scheme premiums, all within certain limits. As of December 2020 this will also include certain aspects of HMRC’s claim, these claims will rank as secondary preferential claims (paid after the employees claims) and consist of the VAT, PAYE and NIC deductions. Preferential creditors rank ahead of all other creditors when realisations are achieved from assets where there is no fixed charge registered.
Unsecured creditors are all other unsecured and non-preferential creditors (with the exception of shareholders/members). These are usually the normal “trade” creditors. They rank below preferential and secured creditors, with the exception of when the prescribed part is applicable (see below).
Shareholders / members will be the last class of creditor to receive a distribution and they will only receive a distribution after everyone else has been paid in full.
What is the prescribed part?
When a secured creditor has a floating charge registered after 15 September 2003, a proportion of the funds available to them is set aside for distribution to unsecured creditors. This is the prescribed part.
The prescribed part applies in this case as there is a floating charge created after 15 September 2003. The amount of the prescribed part is:
- 50% of net property up to £10,000
- 20% of net property above £10,000
- Subject to a maximum of £800,000
Insolvency legislation sets out how the prescribed part is calculated and if it is applicable further details will be provided in the officeholders’ reports to creditors.
What further information will I receive?
As stated above the Administrators will write to all known creditors of the Company (per the creditor list obtained from the Company’s books and records) within 7 days of appointment to formally notify them of the administration appointment and provide details on how to make a claim in the administration. This will be accompanied by a general website notice informing creditors that most future documents for creditors will be posted to a website rather than being delivered by post.
The Administrators will produce a report to all known creditors and members within 8 weeks of the appointment. This report is known as the Joint Administrators’ proposals and will outline steps taken by the Administrators to date and the strategy going forwards. This report will be delivered via upload to the website following the issue of the website notice with the initial creditors letter.
The Administrators are also required to provide a written update on the administration to all known creditors every 6 months. This report will be published on the website within one month of every 6 month anniversary or earlier if an administrator vacates office or an extension to the administration is granted.
Our appointment means that you can’t start or continue legal action, enforce security or repossess any goods held by the Company unless we agree or the court allows it. You can find information on administrators’ fees and your rights at:
Opting Out
Creditors have the right to elect to opt out of receiving certain documents about insolvency proceedings. Any election to opt out will not affect a creditor’s entitlement to receive dividends, should any be paid to creditors. The right to opt out only applies to documents required by the Insolvency Act 1986 or the Insolvency (England and Wales) Rules 2016 to be delivered to creditors generally or to a particular class of creditors. It does not apply to documents or correspondence sent to people in a capacity other than as creditor (e.g. as an employee) or to correspondence sent to individual creditors. Any formal opt out request should be sent to uk_koko_queries@pwc.com or PwC, Central Square, 29 Wellington Street, Leeds LS1 4DL clearly marked up as in relation to Koko Networks (UK) Limited - in administration.
What is the estimated timeframe for reviewing my claim and paying a dividend?
The administration process is complex and it takes time to assess the Company’s position and provide an estimate of the value or timing for reviewing claims and making a distribution. The officeholders will include an update of dividend prospects and, if possible, a timeframe in their proposals and reports.
Will you refund the costs incurred in preparing a claim?
We are unable to refund the costs in preparing a claim. Consequently, we cannot refund any expenses incurred in obtaining information necessary to make a claim.
How to submit a claim
Our preferred method for creditors to submit claims and supporting documents is via the Turnkey (IPS) online portal, as this is the most efficient and cost effective way for us to deal with your claim and also allows you to better track its status, so we recommend the use of the online portal for claim submission.
In order to utilise this system, any creditors who have not received a letter with your unique login details within three weeks of the appointment, please contact us on uk_koko_queries@pwc.com.
In preparation for submitting your claim please ensure that you have all relevant details such as your order confirmation or receipt, invoices or other documentation demonstrating the amount owed to you.
Directors’ conduct
One of our duties is to look at the actions of anybody who has been a director of the Company in the three years before our appointment. We also have to decide whether any action should be taken against anyone to recover or contribute to the Company’s assets. If you think there is something we should know about, please write to me at uk_koko_queries@pwc.com. This is part of our normal work and doesn’t necessarily imply any criticism of the directors’ actions.
If your query has not been answered by the above, please email: uk_koko_queries@pwc.com.
