area for reform was to facilitate the rescue of businesses that could still be viable. Following the Cork Report

Over the 20th century, reform efforts focused on three main issues. The first concerned setting a fair system of priority among claims of different creditors. This primarily centred upon the ability of powerful contractual creditors, particularly banks, to agree to take a security interest over a company's property, leaving unsecured creditors without any remaining assets to satisfy their claims. Immediately after Salomon's case and the controversy created over the use of floating charges, the Preferential Payments in Bankruptcy Amendment Act 1897 mandated that preferential creditors (employees, liquidator expenses and taxes at the time) also had priority over the holder of a floating charge (now IA 1986 section 175). In the Enterprise Act 2002 a further major change was to create a ring-fenced fund for all unsecured creditors out of around 20 per cent of the assets subject to a floating charge.[11] At the same time, the priority for taxpayers' claims was abolished. Since then, debate for further reform has shifted to whether the floating charge should be abolished altogether and whether a ring-fenced fund should be taken from fixed security interests.[12] The second major area for reform was to facilitate the rescue of businesses that could still be viable. Following the Cork Report in 1982,[13] the Insolvency Act 1986 created the administration procedure, requiring (on paper) that the managers of insolvent businesses would attempt rescue the company, and would act in all creditors' interests. After the Enterprise Act 2002 this almost wholly replaced the receivership rules by which secured creditors, with a floating charge over all assets, could run an insolvent company without regard to the claims of unsecured creditors. The third area of reform concerned accountability for people who worsened or benefited from insolvencies. As recommended by the Cork Report, the Company Directors' Disqualification Act 1986 meant directors who breached company law duties, or committed fraud could be prevented from working as directors for up to 15 years. The Insolvency Act 1986 section 214 created liability for wrongful trading. If directors failed to start the insolvency procedures when they ought to have known insolvency was inevitable, they would have to pay for the additional debts run up through prolonged trading. Furthermore, the provisions on fraudulent conveyances were extended, so that any transaction at an undervalue or other preference (without any bad intent) could be avoided, and unwound by an insolvent company.