Administrator Remuneration: Approval and Review

Identify the Administrator and Fee Decision

Identify the company, office-holder and appointment period before preparing or assessing the fee request. Keep the voluntary administration separate from a later deed administration, even when the same practitioner holds both offices. Record the proposed calculation basis and the body being asked to decide it.

The appointment determines the work for which remuneration is sought. Approval establishes the amount or calculation method authorised under the applicable determination. Payment is the subsequent drawing from available funds. Keep separate fields for each stage.

ASIC’s voluntary administration guide explains that administrators can seek approval for completed work and estimated future work. Read the deed’s provisions where the request concerns a deed of company arrangement. Do not carry an approval for one office into another without checking its actual scope.

Separate the practitioner’s remuneration from reimbursed expenses and third-party invoices. Record whether each disbursement is charged at cost or includes an internal charge requiring approval. The appointment’s wider process belongs to voluntary administration. A trustee in bankruptcy has a separate personal-insolvency fee framework.

Build the Work and Financial Support

Build a fee schedule that explains what the administrator did, who did it and how the charge was calculated. For time-based work, group entries by task and staff grade. State the period, hours and rate, then reconcile the task totals to the amount requested.

ARITA’s remuneration information sheet describes time records and the information creditors need to assess a proposal. Include the estimated total remuneration and its likely effect on creditor distributions. Explain material changes from earlier estimates and show previous approvals alongside amounts already drawn.

For a fixed fee, retain the agreed scope and explain the work it covers. For another basis, show the inputs and calculation. Keep the proposal’s tax treatment consistent with the fee account and cash forecast.

The professional standard APES 330 Insolvency Services also governs members’ fee conduct. It requires an explanation to creditors when the claimed amount or estimate differs from the estimate given to directors. It also restricts a member from seeking more than a fixed fee or unconditional quote given to directors. Professional obligations under APES 330 operate alongside the statutory approval process.

Prepare an explanation for entries that appear duplicated. Retain the time entry, work product and reason for any separate review. A file review can be necessary, but the label alone does not explain why the charge belongs to this appointment.

Put a Usable Proposal to the Proper Decision-Maker

Select the approval route and write the precise resolution before sending the proposal. Under Schedule 2, section 60-10 of the Corporations Act, creditors can make the determination. A committee of inspection can do so if creditors have not made one. The court route applies if neither has made a determination.

A time-cost determination must include a cap. Record whether the amount concerns completed work, future work or both. A prospective cap permits payment only for the work and calculation method it actually covers. It is not an entitlement to draw the whole cap immediately.

Use this sequence to prepare the decision record.

1. Match the proposed resolution to the appointment, work period and calculation basis. Identify any earlier authority it changes.
2. Supply the task report and financial effect with the notice or written proposal. State the proposed cap and any conditions.
3. Check the creditor’s admitted voting claim, representative authority and any proxy. Record objections separately from votes.
4. Retain the voting calculation and exact resolution passed. Check its scope before preparing a drawing.

ASIC’s approving fees guide explains meeting and written-proposal routes. A written proposal must allow at least 15 business days for responses. Its result requires the applicable majority in number and value, with the objection threshold also satisfied. A committee decision needs a majority of members attending and a majority vote among those present.

Before issuing the notice, check the applicable provisions in the Insolvency Practice Rules. Meeting, written-proposal and committee procedures have different notice and decision requirements. Keep the selected procedure’s compliance record with the resolution. Where no determination exists, assess the statutory default entitlement separately instead of treating a rejected proposal as authority for that amount.

Assess Objections and Choose the Review Route

Identify the disputed task or calculation before deciding which review route fits the objection. Ask for the relevant task breakdown, staff level and work product. Record the administrator’s explanation and whether the issue changes the amount requested.

Consider a fictional proposal with two entries for the same four-hour bank reconciliation. Each entry charges $250 per hour, excluding GST. Both cite the same preparer and work product, and the administrator confirms that one entry was copied twice. The unsupported duplicate is $1,000, so a $10,000 proposal becomes $9,000 before GST.

If a second entry instead records a separate supervisory review, examine what that review involved and why it was necessary. The two labels alone do not establish duplication. A low creditor return also does not establish that properly performed work was unreasonable.

A court review of an existing remuneration determination differs from appointing a reviewing liquidator to investigate fees or costs. Section 60-11 permits an eligible applicant to seek court review, subject to its exception for a determination made by the court. Obtain legal advice about standing, procedure and the remedy sought.

For a reviewing-liquidator appointment, record the route and funding before commissioning the work. Creditors can resolve to appoint a registered liquidator. One or more creditors can also appoint with the external administrator’s agreement. Obtain the proposed reviewer’s written consent and independence information, and specify the fees or costs to be examined.

ASIC’s fee guide describes the creditor-resolution review periods as remuneration approved within the preceding six months and expenses incurred within the preceding 12 months. A longer expense period requires the administrator’s agreement. Confirm the period for the actual appointment route rather than applying those limits to a court order automatically.

The appointing creditors generally fund an agreed individual-creditor appointment. A creditor-resolution appointment generally becomes an administration expense, subject to court orders. Include the review cost in the decision about pursuing the objection.

An ASIC reviewing-liquidator application is another route for eligible applicants. ASIC’s power is discretionary. A request needs supporting evidence and does not itself appoint a reviewer or reduce approved fees.

A reviewing liquidator reports on the assigned matters. That report does not itself replace the remuneration determination. Record any later court order or agreed corrective action before changing the payment schedule.

Reconcile Drawings to the Actual Approval

Match each fee account and estate payment to the resolution or order covering that office and period. Show the authorised amount, remuneration earned within that authority and cash drawn. Keep GST separate so a tax-inclusive bank payment is not mistaken for an excess fee.

The following fictional schedule assumes all listed work is completed and supported. Amounts exclude GST. The two resolutions concern separate periods of the same voluntary administration and contain no overlapping work.

Authority	Approved amount	Earned amount	Drawn amount	Unpaid earned amount
Resolution A, first work period	$12,000	$12,000	$10,000	$2,000
Resolution B, later work period	$8,000	$8,000	$5,000	$3,000
Total	$20,000	$20,000	$15,000	$5,000

The reconciliation is $20,000 approved less $15,000 drawn, leaving $5,000 unpaid for supported completed work. Match the $15,000 to the fee accounts and bank payments after separating GST. A new $6,000 proposal remains outside the approved total until the applicable authority exists.

If a resolution sets a future-work cap, add the amount actually earned to the schedule. Unused cap is not unpaid earned remuneration. If a review changes a determination, retain both versions and reconcile any repayment or credit to the resulting authority.

Finish with the resolutions, notices and minutes linked to the schedule. Record resolved objections and assign any remaining dispute. The administrator remains responsible for the remuneration claimed. A court determines reasonableness when exercising its statutory review power, while a reviewing liquidator provides the assessment within the assigned review scope.