George and Matt are the directors of The Great Aussie Barbecue Pty Ltd (GAB), a business that supplies barbecues and accessories to both small business owners and to home barbecue enthusiasts. George and Matt each own 500 shares in the company. George is the public face of the company. He was a finalist on MasterChef Australia in 2017 and is well known for his barbecue recipes. Each barbecue sold included one of George's recipe books. Matt has a business and accounting degree and looked after the company records. Matt realised that the company was in dire financial difficulties in October 2021. At the beginning of the pandemic, many people bought barbecues so they could enjoy delicious meals cooked in their own backyards, however, eventually the number of new customers dwindled. Matt told George over coffee one morning that cash flow was a bit tight, but did not further elaborate. Matt seemed confident that this was a temporary issue as the government had indicated that by December 2021, the economy would fully re-open and he was sure business would pick up. By March 2022, customer numbers did not pick up. George noticed a pile of "final demand" notices from suppliers on Matt's desk and asked to see the actual accounts rather than continuing to rely on Matt's assurances. It was only then that George realised that the company was insolvent. The company went into liquidation in June 2022, owing large sums of money to its creditors.

Assume that in June 2022 the company goes into liquidation. Explain whether Matt and George have breached s. 588G of the Corporations Act 2001 (Cth). Set out the consequences of such a breach, in particular consider personal liability of the directors for debts of the company.