Winding up a Corporation
Definition - What does Winding up a Corporation mean?
Winding up a corporation is a legal act by which a corporation is liquidated for the purpose of shutting down. In order to accomplish this, all legal requirements for winding down a company must be followed as well as a broader regime that covers corporations. In general, it is a matter of liquidating all assets and calling in all debt owed to the corporation; paying off what debt exists to suppliers and creditors; and allowing all interested parties to make a claim to the liquidator or company secretary in order for all issues to be concluded.
Justipedia explains Winding up a Corporation
Laws are in place that govern how a company must act when it is closing business in order to legally protect the companies and people that have transacted with the company in an effort not to leave any debt unpaid. There are times when it is not possible to pay all debtors and in such instances, a liquidator is hired to determine which creditors are able to be paid.