Chapter 39


Grant W. Newton, PhD, CPA, CIRA

Pepperdine University

39.1 Overview

39.2 Alternatives Available to Troubled Companies

(a) Out-of-Court Settlements

(b) Assignment for Benefit of Creditors

(c) Bankruptcy Court Proceedings

(i) Title 11—Bankruptcy Code

(ii) Chapter 7—Liquidation

(iii) Chapter 12—Adjustment of Debt of a Family Farmer with Regular Annual Income

(iv) Prepackaged/Prenegotiated Chapter 11 Plans

(d) Accountant's Services in Proceedings

39.3 General Provisions of Bankruptcy Code

(a) Filing of Petition

(b) Timing of Petition—Tax Considerations

(c) Accounting Services—Data Required in the Petition

(d) Adequate Protection and Automatic Stay

(i) Relief from the Stay

(ii) Accounting Services—Determining Equity in Property

(e) Executory Contracts and Leases

(i) Limitations on Executory Contracts

(ii) Accounting Services—Rejection of Executory Contracts

(f) Avoiding Power

(g) Preferences

(i) Exceptions to Preferential Transfers

(ii) Accounting Services—Search for Preferential Payments

(h) Fraudulent Transfers

(i) Leveraged Buyout as a Fraudulent Transfer

(ii) Accounting Services—Search for Fraudulent Transfers

(i) Postpetition Transfers

(i) Adequate Value Received

(ii) Accounting Services—Preventing Unauthorized Transfers

(j) Setoffs

(i) Early Setoff Penalty

(ii) Accounting Services—Setoffs

(k) Reclamation

(l) U.S. Trustee

39.4 Handling of Claims Under Chapter 11

(a) Proof of Claims

(b) Undersecured Claims

(c) Administrative Expenses

(d) Priorities

(e) Processing ...

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