With the operating company of Manor Racing in administration, it is unlikely the Formula one racing team will be in action next year.
The concern, primarily, remains with Manor's operating company Just Racing Services, which went into administration as Geoff Rowley and Phil Armstrong, partners of FRP Advisory LLP, were appointed as joint administrators on January 6, 2017.
Manor Grand Prix Racing Limited, which holds the rights for the team's participation in F1, will continue to trade, the person added.
Sources said that staff at Manor's headquarters were expected to be informed about the developments later on Friday morning.
The team's participation in March's season-opener Down Under will "depend on the outcome of the administration process and any related negotiations with interested parties in what is a very limited window of opportunity", FRP said.
Fears for Manor's future began to surface after the Brazilian Grand Prix in November when Sauber driver Felipe Nasr finished ninth, scoring two points and relegating Manor to the bottom of the constructor's championship standings.
The Manor Formula 1 team has officially dropped into administration due to failures in finding a buyer.
"No redundancies have been made following JRSL's entering into administration and all staff have been paid in full to the end of December".
Manor, formerly known as Marussia, which went into administration in late 2014, was in discussions with investor groups throughout a year ago, and agreed on terms of a sale to an Asian investment consortium in December, only for the deal to fall through.
American investors led by race promoter Tavo Hellmund had been close to a deal several weeks ago but discussions are understood to have broken down.
Stephen Fitzpatrick, owner of the Ovo energy company, stepped in to save the team - then branded as Marussia - when they faced a similar crisis ahead of the 2015 season.
According to Sky News, the team has lined up FRP Advisory to act as the administrator who, it is reported, are hoping to keep the team - who employ 200 people - afloat. "We made a huge amount of progress on and off track but ultimately it was not enough".