One of Your Corporate Clients Has Recently Filed for Bankruptcy

question 68

Essay

One of your corporate clients has recently filed for bankruptcy. In the course of the proceedings, you (a)prepare a plan of reorganization that alters the rights of preferred stockholders, (b)notify the company's creditors of an impending bulk transfer of the company's assets, (c)review IRS secured claims against these assets, (d)restructure the company's debt by reducing its principal amount and extending its maturity, and (e)advise the bankruptcy court as to how this restructuring will impact the company's NOLs. Which of these activities, if any, constitutes the unauthorized practice of law?

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Definitions:

Balance Sheet

A balance sheet is a financial statement that provides a snapshot of a company's financial condition at a specific point in time, detailing assets, liabilities, and shareholders' equity.

Income Statement

A financial statement that reports a company's financial performance over a specific accounting period, detailing revenue, expenses, and net income.

Accrual

The accounting method where revenue and expenses are recorded when they are earned or incurred, regardless of when the cash is actually received or paid.

Expense

An expense represents a cost incurred by a business or individual in the process of generating revenue.