Silver Shemmings recognise that cash flow is the key to keeping a business going. When businesses find themselves chasing money from companies which are in financial difficulties then problems can arise.
Insolvency means the inability to pay one’s debts as they fall due. Usually used in Business terms, insolvency refers to the inability for a company to pay its debts.
Business insolvency is defined in a number of ways:
- Cash flow insolvency
- Inability to pay debts as and when they fall due
- Balance sheet insolvency
- in other words, liabilities exceed assets
A business may be ‘cash flow insolvent’ but ‘balance sheet solvent’ if it holds non-liquid assets, particularly against short term debt that it cannot immediately realise if called upon to do so. Conversely, a business can have negative net assets showing on its balance sheet but still be cash flow solvent if ongoing revenue is able to meet the debt obligations, and thus avoid default – for instance, if it holds long term debt. Many large companies operate permanently in this state.
Our team of lawyers advise companies on:
- Liquidations and receivership
- Administration and CVA’s
- Directors’ responsibilities
- Retention of Title claims
- Claims by Creditors
- Statutory Demands – Issue and application to Court to stop Statutory Demands
- Winding Up Petitions – Issue and appearances at Court
- Bankruptcy Petitions
- Debt Recovery