In what order will creditors be paid?

Liquidators are obliged to pay creditors is a strict order as set out in the Corporations Act.

Liquidators' costs and expenses must be paid as a priority cost of the liquidation. After liquidation expenses have been paid, any outstanding employee entitlements must then be paid. If then there are sufficient funds on hand in the liquidation, ordinary unsecured creditor claims are paid.

If the company in liquidation does not have sufficient funds to pay unsecured creditor claims in full, then ordinary unsecured creditor claims are paid on a pro-rated basis.