The following list is a non-exhaustive list of factors that could indicate that a company is or was insolvent:
If any of these factors are currently present, any creditors should consider their position to ensure that they are not left with exposure in administrator or liquidation. Further creditors should ensure that if the company becomes insolvent and doesn’t pay its debts, will that affect the solvency of their business or company.
If the company is already in administration or liquidation, these factors may be used to establish the company was insolvent at a specific or earlier time. There are personal consequences for directors that allow a company to continue to trade whilst insolvent, which may increase the amount any creditors are paid.