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17th December: Daily Summary and Analysis of PIB (Press Information Bureau) Hindi
Insolvency -- the inability of a person or corporation to pay their bills as when it become due and payable. Bankruptcy -- when a person is declared incapable of paying his/her due or payable bills. Bankruptcy is a legal status of a person or other entity that cannot repay the debts it owes to creditors. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the debtor. 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 (negative net worth). Cash flow insolvency involves a lack of liquidity to pay debts as they fall due.