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Technical insolvency occurs when an individual or a firm is unable to meet their financial obligations. Accounting insolvency happens when total liabilities exceed total assets
When an individual or organization can no longer meet its financial obligations with its lender or lenders as debts become due. Insolvency can lead to insolvency proceedings, in which legal action will be taken against the insolvent entity, and assets may be liquidated to pay off outstanding debts.
In other words when the means of a debtor are not sufficient enough to cover for payment to creditors who demand payment thereof through a court of justice, and the court adjudicates the incapacity of the debtor for immediate payment and defer the payments by liquidating the assets under court supervision.
In legal terminology, the situation where the liabilities of a person or firm exceed its assets. In practice, however, insolvency is the situation where an entity cannot raise enough cash to meet its obligations, or to pay debts as they become due for payment. Properly called technical insolvency, it may occur even when the value of an entity's total assets exceeds its total liabilities. Mere insolvency does not afford enough ground for lenders to petition for involuntary bankruptcy of the borrower, or force a liquidation of his or her assets.
Thanks for the invitation..you and Sir Venkitaraman Krishna Moorthy Vrindavan already defines it completely.in addition to Insolvency means any one who is unable or fails to continue its financial operations.
Agreed with the answers to all colleagues
a firm is unable to meet their financial obligations.
involves a lack of liquidity to pay debts as they fall due.
An incapacity to pay debts upon the date when they become due.
individual or organization can no longer meet its financial obligations.
person or firm exceed its assets.
unable to satisfy creditors. there are many "definitions" in short Not satisfied or no match.
the inability to meet the liabilities.
