What does insolvency mean?
Definitions for insolvency
ɪnˈsɒl vən siin·sol·ven·cy
This dictionary definitions page includes all the possible meanings, example usage and translations of the word insolvency.
Princeton's WordNet
insolvencynoun
the lack of financial resources
Wiktionary
insolvencynoun
The condition of being insolvent; the state or condition of a person who is insolvent; the condition of one who is unable to pay his debts as they fall due, or in the usual course of trade and business; as, a merchant's insolvency.
insolvencynoun
Insufficiency to discharge all debts of the owner; as, the insolvency of an estate.
insolvencynoun
The condition of having more debts than assets.
Samuel Johnson's Dictionary
Insolvencynoun
Inability to pay debts.
Etymology: from insolvent.
Wikipedia
Insolvency
In accounting, insolvency is the state of being unable to pay the debts, by a person or company (debtor), at maturity; those in a state of insolvency are said to be insolvent. There are two forms: cash-flow insolvency and balance-sheet insolvency. Cash-flow insolvency is when a person or company has enough assets to pay what is owed, but does not have the appropriate form of payment. For example, a person may own a large house and a valuable car, but not have enough liquid assets to pay a debt when it falls due. Cash-flow insolvency can usually be resolved by negotiation. For example, the bill collector may wait until the car is sold and the debtor agrees to pay a penalty. Balance-sheet insolvency is when a person or company does not have enough assets to pay all of their debts. The person or company might enter bankruptcy, but not necessarily. Once a loss is accepted by all parties, negotiation is often able to resolve the situation without bankruptcy. A company that is balance-sheet insolvent may still have enough cash to pay its next bill on time. However, most laws will not let the company pay that bill unless it will directly help all their creditors. For example, an insolvent farmer may be allowed to hire people to help harvest the crop, because not harvesting and selling the crop would be even worse for his creditors. It has been suggested that the speaker or writer should either say technical insolvency or actual insolvency in order to always be clear – where technical insolvency is a synonym for balance sheet insolvency, which means that its liabilities are greater than its assets, and actual insolvency is a synonym for the first definition of insolvency ("Insolvency is the inability of a debtor to pay their debt."). While technical insolvency is a synonym for balance-sheet insolvency, cash-flow insolvency and actual insolvency are not synonyms. The term "cash-flow insolvent" carries a strong (but perhaps not absolute) connotation that the debtor is balance-sheet solvent, whereas the term "actually insolvent" does not.
Webster Dictionary
Insolvencynoun
the condition of being insolvent; the state or condition of a person who is insolvent; the condition of one who is unable to pay his debts as they fall due, or in the usual course of trade and business; as, a merchant's insolvency
Insolvencynoun
insufficiency to discharge all debts of the owner; as, the insolvency of an estate
Wikidata
Insolvency
Insolvency is the inability of a debtor to pay their debt. Cash flow insolvency involves a lack of liquidity to pay debts as they fall due. Balance sheet insolvency involves having negative net assets—where liabilities exceed assets. Insolvency is not a synonym for bankruptcy, which is a determination of insolvency made by a court of law with resulting legal orders intended to resolve the insolvency. A business may be cash-flow insolvent but balance-sheet solvent if it holds market liquidity assets, particularly against short term debt that it cannot immediately realize 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 debt obligations, and thus avoid default: for instance, if it holds long term debt. Some large companies operate permanently in this state.
Matched Categories
Numerology
Chaldean Numerology
The numerical value of insolvency in Chaldean Numerology is: 3
Pythagorean Numerology
The numerical value of insolvency in Pythagorean Numerology is: 3
Examples of insolvency in a Sentence
European Council President Donald Tusk:
Our inability to find an agreement may lead to the bankruptcy of Greece and the insolvency of its banking system.
If you have insolvency of this size, whoever has credit (for supplying energy) will not be paid.
Czech Industry Minister Jan Mladek:
I would narrow this to two options. Either the owners will lower their demands for the sale of worthless shares ... or there will be insolvency, it would have to be significantly less (for the sale), and we would have to reach consensus with the finance minister, which I do not consider to be entirely easy after today's debate in the cabinet.
Finance Minister Natalia Yaresko:
Despite the information campaign about the supposed insolvency of Ukraine, I declare Ukraine today is fulfilling all aspects of its external financial obligations.
They were right on the edge of insolvency, elon has pointed out at that moment they were on the edge and that helped to save the company.
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References
Translations for insolvency
From our Multilingual Translation Dictionary
- إعسار مالي, إعسارArabic
- неплатежоспособностBulgarian
- platební neschopnost, insolvenceCzech
- Zahlungsunfähigkeit, InsolvenzGerman
- nesolventecoEsperanto
- insolvenciaSpanish
- maksukyvyttömyysFinnish
- insolvabilitéFrench
- neuhooghidManx
- 支払不能Japanese
- ದಿವಾಳಿತನKannada
- несостоятельность, неплатёжеспособностьRussian
- insolvensSwedish
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"insolvency." Definitions.net. STANDS4 LLC, 2024. Web. 7 May 2024. <https://www.definitions.net/definition/insolvency>.
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