Soar Aviation’s liquidators have now said they don’t believe the troubled flight school traded while insolvent, despite earlier indicating the business could have done so for up to a year.
KPMG’s final report also revealed how the school’s fleet of around 50 aircraft have now been sold for $5.3 million, and it collapsed owing secured creditors $7.9 million and employees $1.1 million.
Soar collapsed into administration on 29 December and it came with the company indirectly facing a class action from more than 200 students arguing its teaching standards were so poor it didn’t meet the basic CASA requirements to obtain a pilot’s licence.
The ATSB is also currently investigating an incident that saw a Soar Aviation instructor and student die when one of its Aquila AT01s crashed in the NSW central west last year.
“As noted in the Administrators’ Report, our preliminary view was that the [Soar Aviation] Group may have been insolvent from as early as January 2020 to the date when the Growth Fund withdrew financial support of the Group, being 24 December 2020,” said KPMG in a final report.
“It is our view that the Group was not insolvent until financial support was withdrawn on 24 December 2020 (the business day prior to the Group entering Voluntary Administration).
“No evidence of insolvent trading has been found. In any event, given the relief provided to Directors over most of this period by the federal government in response to the coronavirus pandemic, no recovery would be available to creditors from any insolvent trading action.”
It came after KPMG subsequently rowed back on the allegation in its previous report, saying the flight school’s directors maintained they “sought and obtained funding” required to run the company in January 2020.
Its collapse, however, left unsecured creditors owed hundreds of thousands and many of its current trainees in limbo.
The news comes after Australian Aviation reported in January how callers trying to contact Soar were presented with a voice message bluntly informing them that the business wouldn’t be taking or responding to any messages.
Callers, many of whom were likely to be current students trying to get through to Soar, were given no advice on how to seek help, and were simply told, “Unfortunately, as of 29 December 2020, we are unable to take your call, take any messages or return any messages. We apologise for any inconvenience caused.”
On that date, the business entered administration with KPMG partners Brendan Richards and James Stewart appointed to help the business pay off its huge debt pile.
Founded in 2012, the company grew to have campuses at Moorabbin Airport in Melbourne, Bendigo Airport in regional Victoria and Sydney’s Bankstown Airport.
Its fleet of 50 aircraft comprised Bristell LSA, Technam P2006T, Foxbat A22LS, Vixxen A32 and Aquila A210 aircraft, according to the company’s website, as well as a CKAS 7D0F simulator.
However, things turned sour in 2019 when partners Box Hill demanded the business supply documentation about its fleet and trainers.
Soar’s registered training organisation status was then revoked after an audit by the regulatory body for vocational education sparked by complaints by former students, alleging they didn’t receive the training they were promised.
Gordon Legal then launched a class action on behalf of 200 students arguing its teaching standards were so poor it didn’t meet the basic CASA requirements to obtain a pilot’s licence.
While the business had its accreditation restored, it still faced sanctions.
More seriously, the ATSB is currently investigating an incident that saw a Soar Aviation instructor and student die when one of its Aquila AT01s crashed in the NSW central west last year.
Both Saket Kapoor, 38, and Shipra Sharma, 26, died when the incident occurred at a private airstrip. No conclusions have yet been reported by the ATSB.
Founder Neel Khokhani resigned in early 2019, though has insisted it was purely a result of personal health reasons unrelated to the company’s struggles.
More recently, in a separate incident, the ATSB in May said a Soar Aviation student pilot who crashed his Bristell aircraft and suffered serious head injuries didn’t have permission to conduct the flight solo.
However, the report revealed the trainee believed he did have authorisation, despite clearly not following the correct procedures.