• About Us
• Meet The Team
• Factoring Services
• Insolvency Services
• CVA
• Pre Pack

Defining Insolvent Companies

Contact the UK’s Leading Experts in Business Recovery Today...

Whether or not a company is technically insolvent has always been a matter up to much debate. There are actually levels of insolvency which can often be turned around if the services of a debt relief company or Insolvency Practitioner are enlisted. Being insolvent simply means not being able to pay debts and there is no expectation that those debts will be paid in full unless some major restructuring or other process is utilised to turn the company around. UK statistics are encouraging in this regards and literally hundreds, if not thousands, of insolvent companies have been able to stay in business because of rescue measures put in place by legislation. Therefore, if you are looking for an insolvent definition, you are probably really trying to determine if insolvency is going to lead to liquidation and winding up of your business.

As it has been stated, an insolvent company may just be able to go through restructuring rescue measures in order to become solvent in the future. This takes a very special set of skills, especially if your company is now at the brink of bankruptcy. Most IP's are accountants and solicitors who are able to reorganize management and day to day operations of a company to help it begin turning a profit again. Reorganisation may mean a complete change in management as well as selling off some assets that have become a liability. An insolvent business doesn't necessarily need to seek bankruptcy, but if it cannot be avoided then the IP will recommend the best steps to follow. It is his/her responsibility to make sure as many debts as possible can be paid through realisation of assets. However, in the end it is always in the best interest of the company to keep it running so that debts can be paid with any revenue coming in.

Find out more...