49 Pages Posted: 16 May 2010
Date Written: January 30, 2010
These Guidelines (in Italian), drawn up by the University of Florence, the National Council of Accountants and the Association of Italian Stock Companies, aim to guide practitioners, turnaround specialists, auditors, professional trustees, expert witnesses and forensic accountants through the process of restructuring distressed firms by means of the new instruments created by the Reform of the Bankruptcy Act carried out in 2005-2007 (out-of-court reorganization plans, court-controlled multi-party renegotiation and “Chapter 11-style” reorganization).
The drafting of the Guidelines began in 2007 as a National Research Project by a team headed by Professor Stanghellini and are the result of extensive and protracted consultation and discussion with all interested parties. A draft version was publicly presented in May 2008. This is the first final version.
The Guidelines address, among other issues: independence of auditors in charge of certifying the reorganization plan; applicable auditing standards; drafting standards (hypotheses, methodologies, time frame, sensitivity tests, milestones, anticipation of planned actions); certifications standards (structure and effects of certification, re-certification of a plan that has proven unfeasible). With regard to proper judicial reorganisation: court protection under an incomplete plan; debtor-in-possession financing as a precondition of the plan; post-reorganisation financing; financing and spin-offs in liquidation proceedings.
Notes: Downloadable document is in Italian.
Keywords: Bankruptcy, Reorganization, Italy, DIP Financing
JEL Classification: G33, K29
Suggested Citation: Suggested Citation
Stanghellini, Lorenzo, Guidelines on Financing of Distressed Firms – 1st Edition, 2010 (Linee guida per il finanziamento alle imprese in crisi – 1a edizione, 2010) (Italian) (January 30, 2010). Available at SSRN: https://ssrn.com/abstract=1606562 or http://dx.doi.org/10.2139/ssrn.1606562