Covid killed the clinic: IRD has liquidators appointed to Manukau medical business

Manukau Family Doctors was once open at 597 Great South Rd but has now shut. Photo / Google Street View

Inland Revenue has had liquidators appointed to a Manukau medical centre for unpaid taxes.

KPMG’s Janet Sprosen and Leon Bowker were appointed liquidators of Manukau Family Doctors, Accident & Medical.

Their first report has now been posted on the Companies Office website and outlines how the business failed.

The company has been operating in an area of Auckland with high medical needs and a GP shortage, but its sole director Dr Siva Vasanthan cited the Covid-19 pandemic as causing problems for his business.

The Companies Office shows the business was incorporated in 2006, owned by Seetha and Siva Vasanthan but the sole director was Dr Siva Vasanthnan.

An initial report on the business showed KPMG liquidators had interviewed him about the insolvency and asked why Manukau Family Doctors, Accident & Medical had not paid the IRD.

“The director advised the company’s business failed because of the impacts of Covid-19,” the KPMG report said.

“The director advised that the company was trading as at the date of liquidation,” it said.

Liquidators were appointed on May 31 by the High Court.

The KPMG liquidators told Dr Vasanthan the business could not continue to trade. They terminated all employees’ contracts.

“The liquidators attended the company’s premises and confirmed the business was not open. The liquidators met with the director and shareholder. The director advised of a potential purchaser for the company’s business. The liquidators are in communication with the interested party regarding a sale and purchase of the business.

“During the reporting period the liquidators also attended to administrative tasks including corresponding with creditors and attending to statutory reporting requirements,” KMPG said.

A statement of assets listed those as being negative, the company owing approximately $313,000.

Preferential creditors were estimated to be owed $254,000, unsecured creditors $55,000 and informal creditors just over $4000.

The value of any vehicles, plant or equipment, furniture and fittings, cash and other assets was listed as “withheld”.

Pharmacy Retailing (NZ), trading as Healthcare Logistics, is listed as a secured creditor.

The company received $28,000 in Covid cash initially for four employees when the pandemic broke out, then a further $18,000 as a wage subsidy extension, then another $38,000 in August 2021.

The business said it was a family-orientated medical centre offering a full range of GP services. It listed Dr Siva Vasanthan as a GP and said before it shut, that it was available to take new patients. Languages spoken were English, Hindi, Punjabi, Tamil and Gujarati.

The phone number at the medical centre still answered today but gave an automated message which advised people to call 111 if phoning about an emergency and apologised for the clinic being shut.

Services it offered when it was open included immunisation, vaccination, minor accident care, minor surgery, prescriptions, lab results, IUCD insertion, cervical screening, ECG and travel advice.

The Royal New Zealand College of General Practitioners noted the “well-established South Auckland practice” was listed for sale in February this year.

“Owner retiring. Foundation standard accredited. Purpose-built premises. Can accommodate up to four GPs and X-ray facility. Pharmacy, physio, midwives, dentist next door. Close to Manukau CBD, n busy Great South Road, easy access by motorway,” that ad says according to the college.

KPMG said much of the financial information about the company was withheld “so as not to prejudice the sale of the business”.

Anne Gibson has been the Herald’s property editor for 23 years, has won many awards, written books and covered property extensively here and overseas.