Rehabilitating financially distressed companies
Become a Licensed Business Rescue Practitioner
About Business Rescue
In South Africa, Business Rescue was introduced in Chapter 6 of the new Companies Act 2008 (Act 71 of 2008) and provides for the rescue, recovery and turnaround of companies in financial trouble.
A company that is experiencing financial distress may apply to the CIPC to be put into business rescue. If its request is granted, a business rescue practitioner is appointed to draw up a plan to put the business back on its feet, get the buy-in of creditors and other stakeholders, and then implement the plan. While the business rescue is in progress, creditors cannot sue the company for repayment.
Accountants can act as Business Rescue Practitioners, opening a new revenue stream for practices.
Requirements to qualify as a Business Rescue Practitioner (BRP)
Section 138 of the Companies Act, 2008 regulates the qualifications required for a business rescue practitioner.
In order to qualify as a BRP, a person must be:
- a member in good standing of an accounting, legal or business management professional body accredited by CIPC (section 138(1)(a)); thus, accredited by an institution like CIBA and
- be licensed as such by CIPC (section 138(1)(b)).
Read the revised CIPC requirements for licensing a BRP here.
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Note that Recognition of Prior Learning (RPL) candidates do not qualify as per CIPC policy.
CIBA as Accredited Institution
The Companies and Intellectual Property Commission (CIPC) has accredited the Chartered Institute for Business Accountants (CIBA) as a professional body for business rescue practitioners in terms of Section 138(1) of the Companies Act, 2008.
CIPC issues a list to verify accredited institutions. Read the list here.
As an accredited institution CIBA is responsible for:
- Ensuring that members are competent and able to provide high-quality services and accountable for the work they perform.
- Providing opportunities and monitoring Continuous Professional Development (CPD)
- Reporting CPD compliance and non-compliance.
The Responsibilities of a BRP
CIBA registered BRPs are responsible for:
- Identifying and completing relevant CPD as required by the CIPC and CIBA,
- Keeping records of CPD,
- Renewing their license annually,
- Perform business rescue services ethically and in good faith, and, for a proper purpose in the best interest of the company with care, skill and diligence.
Obtain Statutory Recognition
CIBA has developed a specialist license for those members who wish to become Business Rescue Practitioners (BRP). The license is in the format of an exam supported by a prescribed textbook and a study guide.
- Exam fee from R8,500
- Study guide and exam preparation
- Annual license renewal fee from R2,500
- Links to third party reading material (prescribed textbook)
- 2 Attempts allowed to pass
- Exam preparation time various depending on experience
Lecturer and Industry Expert
Dr Eric Levenstein of Workmans Attorneys, has developed both the exam and the exam preparation.
He has extensive experience in:
- Business Rescue
- Insolvency
- Restructure
- Turnaround
Watch the video below to view his introduction to the License.
