This expert will consult with attorneys / clients that are located in: AK (Alaska), AL (Alabama), AR (Arkansas), AZ (Arizona), CA (California), CO (Colorado), CT (Connecticut), DC (District of Columbia), DE (Delaware), FL (Florida), GA (Georgia), HI (Hawaii), IA (Iowa), ID (Idaho), IL (Illinois), IN (Indiana), KS (Kansas), KY (Kentucky), LA (Louisiana), MA (Massachusetts), MD (Maryland), ME (Maine), MI (Michigan), MN (Minnesota), MO (Missouri), MS (Mississippi), MT (Montana), NC (North Carolina), ND (North Dakota), NE (Nebraska), NH (New Hampshire), NJ (New Jersey), NM (New Mexico), NV (Nevada), NY (New York), OH (Ohio), OK (Oklahoma), OR (Oregon), PA (Pennsylvania), PR (Puerto Rico), RI (Rhode Island), SC (South Carolina), SD (South Dakota), TN (Tennessee), TX (Texas), UT (Utah), VA (Virginia), VT (Vermont), WA (Washington), WI (Wisconsin), WV (West Virginia), & WY (Wyoming).

An ailing company may exhibit certain signs - an inability to pay debts timely, the loss of significant customers or suppliers, cutoff of bank credit lines of protracted litigation - that, taken as a whole, are warning signals presaging the cessation of the business. As a trusted financial adviser, the CPA can take an active role in dealing with the company's financial affairs in advance of a bankruptcy filing.

The CPA can be an integral part of the "crisis team" and assist management by recommending competent insolvency counsel, preparing cash flows and assisting in the negotiation process with lenders and other creditors. Once in place, the team can work with company management in ascertaining whether bankruptcy alternatives are in order (such as out-of-court restructurings and/or forbearance agreements with secured creditors); whether a Chapter 11 restructuring represents the best course of survival; or whether the company is beyond rehabilitation, making liquidation the only prudent course of action. The company then faces the choice of either providing for a reorganization of the company's debt structure, thereby allowing the business to keep operating under Chapter 11 proceedings, or voluntarily (or involuntarily) liquidating the company's assets for the benefit of its outstanding creditors under Chapter 7 or 11.

Once the decision to file for bankruptcy has been made, the CPA can assist management in closing the company's books and records, which will be subject to the scrutiny of many parties during bankruptcy proceedings. Accurately closing the books as of the petition date is a prerequisite to establishing the pre-petition/post-petition timeline. In addition, an accurate petition date accounting closing also facilitates the preparation of bankruptcy statements and schedules required by the Bankruptcy Court within 15 days after the petition date (subject to Court-approved extensions).

Filing a bankruptcy petition avails the debtor of one of the most powerful tools available in bankruptcy - the "automatic stay." The automatic stay effectively freezes the following actions against the debtor: collection efforts, lawsuits, eviction, foreclosure actions, setoffs and lenders' acts to create liens against the company's assets. Accordingly, the CPA's knowledge of the bankruptcy process and ability to work expeditiously are crucial to the process.

Once in bankruptcy, the debtor's CPA can assist the company in a variety of ways, including the following: performing compliance work, consisting of traditional accounting functions such as financial statement and tax return preparation, as well as preparing monthly operating reports required by the Court; assisting in investigatory and forensic accounting work, as directed by debtor counsel; preparing cash collateral and adequate protection analyses, without which the company might be unable to utilize assets vital to its business, such as inventory and accounts receivable; performing preference and fraudulent conveyance investigations, which may result in "found money" for an estate; assisting in the development of the reorganization plan and disclosure statement, including preparation of projections and liquidation analyses designed to assist creditors in their decision to either accept or reject the debtor's reorganization plan.

CPAs need not only represent debtors in bankruptcy. An accountant can be hired by Unsecured Creditors Committees (group of creditors holding claims against the debtor's estate who act as fiduciaries on behalf of all creditors); by Trustees (court-appointed individuals who, in Chapter 11, operate the business or, in Chapter 7, liquidate the business and distribute assets on behalf of the bankrupt estate); by secured lenders or even bankruptcy examiners (court-appointed officials whose job it is to conduct independent investigations of the debtor as is appropriate, including allegations of fraud, dishonesty or misconduct).

In addition, accountants may be engaged in special situations as fiscal agents with or without the authority to write checks on behalf of the debtor; as Plan Oversight Agents, to monitor the performance of the debtor, post-confirmation, and insure that payments to creditors under the Plan of Reorganization are met; as testifying experts or consultants to perform insolvency analyses in litigation; and as disbursing agents, whose job it is to pay those long-suffering pre-petition creditors who have waited years to receive their money.