Collapsed Colmont School investigated over financial transactions

Kilmore’s collapsed Colmont School is being probed over whether it was still incurring debts while insolvent before its sudden closure.

An investigation has been launched into whether the collapsed Colmont School was trading while insolvent in the lead-up to its sudden closure, as its debt climbs to more than $6m.

The Herald Sun can reveal that Cor Cordis, the second team of administrators appointed to oversee the school’s financial situation, have begun probing several financial transactions made by the school that require “substantial further examination” before parents and contractors learn the outcome of their money.

An application filed to the Supreme Court by the administrators on Tuesday sought to extend their convening period by up to six months, to February 23 2023, in a bid to determine whether the school may have “breached their duties” by continuing to incur debts while insolvent.

In a letter circulated to creditors, administrator Rachel Burdett said the school now owed creditors, including parents, teachers and contractors, a total of $6,317,780.

Teachers could be left with the largest shortfall if funds cannot be returned, with $3,415,769 owed to 117 full-time and casual staff.

Parents could stand to lose $2,286,230 in bonds and tuition fees.

More than $300,000 is owed to trade suppliers.

“We have commenced investigations into the financial transactions of the Company and have identified a number of agreements and transactions with related parties that require substantial further examination in order to determine whether there may be any claims under the Act to recover those payments for the benefit of creditors, in the event of liquidation,” Ms Burdett said.

“We have also commenced investigations into whether the Company was trading whilst insolvent and whether the Company’s directors may otherwise have breached their duties,” she said.

The Colmont School in Kilmore has debt of more than $6m.

Ms Burdett said pushing back the deadline to advise creditors of the outcome of their finances would also allow her team to harvest a “large volume of data” from Colmont’s IT systems to truly understand their financial position - a process estimated to take up to eight weeks alone.

Jamie Aldridge, who’s year 11 daughter, Grace, attended the school until its sudden closure, said he objected to the convening period being extended.

“If there is any hope of me getting money back for the $7000+ in fees that I have paid, I want it sooner rather than later and would prefer to not have any delays,” he said.

“I prepaid school fees for my daughter Grace, for the entire school year 2022.”

The administrators have been contacted for comment.

If the extension was granted, it would also allow parties to express their interest in saving the school.

It is understood that one party has applied to maintain the school’s registration with the VRQA for another six months.

Cor Cordis was appointed as administrators for the school, formerly known as Kilmore International School, earlier this month, after the school community and its landlords ousted firm Vince and Associates.

Directors of Skywriters, the company that owns the land on which the school is located, voted out the former administrators due to their alleged “failure” to accept financial offers that would save the school from closing permanently.

In a statement to the Herald Sun, Cor Cordis said they had received several objections to the extension.

“To date, we have received a number of objections, which we are currently reviewing,” the statement said.

Their extension application will be heard in the Supreme Court on August 29.

Colmont’s landlords have given the school a rent-relief period up to September 30.

The International Baccalaureate school, which charged parents more than $20,000 in school fees for senior students, went into administration on July 28, shocking parents and students.