Australian Securities and Investments Commission review finds limited assets constrain liquidation recoveries and creditor returns

The Australian Securities and Investments Commission (ASIC) has published a report and supporting data showing that limited assets constrain recoveries and creditor returns in insolvent liquidations, while simplified liquidation remains rarely used. The review covered 26,664 grouped appointments across court liquidations and creditors’ voluntary liquidations (CVLs) from July 1, 2021, to June 30, 2025. Half of finalised liquidations realised no more than AUD 10,000 in gross assets, and one-quarter realised none. Only 5.3% paid a dividend to ordinary unsecured creditors, with a median dividend of 9.8 cents in the dollar among those that did. Limited funds, alongside evidentiary and commercial considerations, constrain the investigations and recovery actions liquidators can reasonably pursue. In 88.1% of finalised liquidations, ordinary unsecured creditors received no dividend and either no liquidator remuneration was approved or the remuneration paid fell below the approved amount. Only eight simplified liquidations were adopted in 2024–25, equivalent to around 0.2% of CVLs reporting liabilities not exceeding AUD 1 million. That liability threshold is only one of several statutory eligibility criteria. The findings align with ASIC’s previously expressed view that access to simplified liquidation could be improved. Alongside the review, ASIC published an online learning module to help small business directors identify financial difficulty and respond early, when more options may remain to restructure or limit creditor losses.