Nearly six months after S Central’s business assets were sold to Brennan IT, the company’s liquidator has revealed outstanding staff entitlements still haven’t been paid.
Gary Fettes of Rodgers Reidy Chartered Accountants, which was appointed S Central liquidator on February 22, confirmed it was still chasing sufficient financial records from the defunct integrator’s directors to verify unpaid employee entitlements.
Although most staff had now remitted claims to his firm, and some had provided contractual proof of their employment, full company records are required to validate what is owed to employees and creditors. Fettes said there were between 75-100 individuals employed by S Central at the time of the sale to Brennan IT.
“We are endeavouring to get the company records from the former [S Central] director and various other parties. We require these records for outstanding staff entitlements to be covered by the Government’s GEERs program,” Fettes told ARN. Some information had also come from Brennan IT, who provided financial records on the ongoing business assets, he said.
Once employee accounts have been verified, it will take approximately six weeks to secure funding to pay off staff through the Government’s GEERs program. Although Rodgers Reidy had a base estimate on the total value of employee claims, Fettes declined to speculate.
“The employees have a good communication network and we’ve been working closely with them to keep them up to date,” he said. “It’s a slow process because we are having difficulty getting the company records.”
While GEERs payments will give ex-employees some welcome relief, the scheme doesn’t cover outstanding superannuation entitlements.
Rodgers Reidy is responsible for three business entities: S Central Pty Ltd, S Central NSW and Rich Computing. S Central’s distribution arm, Infotronics, went into liquidation on November 11. According to Fettes, the lack of assets or money left in any of its entities also made it unlikely that unsecured creditors would see a return on their dollar.
S Central’s banking partner, NAB, was the sole secured creditor on the list. Fettes was unable to provide total figures on total creditor debt.
“We don’t have sufficient funds to meet the priority claims of employees, so there’s no money for unsecured creditors,” Fettes explained. “There was a significant shortfall in debt due to the secured lender. So any additional funds we raise will go to the secured lender before any unsecured creditors.”
Despite the plight of S Central staff and creditors, made public in early November, the company was not liquidated until February.
“It was a petition by an unsecured creditor that wound the company up – if not, we’d still be waiting,” Fettes said. “Nothing could happen until the company went into liquidation.”
At this stage, no claims have been made against S Central director and former managing director, Peter Mavridis. But as liquidator, Fettes confirmed it would look into the company’s financial position prior to liquidation to determine whether further action should be taken to recoup funds.