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Compulsory liquidation is the term used when a winding up order against a company or a partnership has been granted by the court.
A winding up petition will normally have been presented to the court by a creditor stating that he or she is owed a swill hum of money by the company and that the company cannot pay.
The Official Receiver becomes liquidator but an Insolvency Practitioner will be appointed to take over from the Official Receiver if the company has significant assets.
The liquidator's role is to realise the company's assets, pay all the fees and charges arising from the liquidation, and pay the creditors as far as funds allow in a strict order of priority.
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