Enumerate certain circumstances that necessitates financial restructuring, being part of Internal Corporate Restructuring.

CS Professional · Corporate Restructuring, Valuation and Insolvency · PYQS · December 2018
Enumerate certain circumstances that necessitates financial restructuring, being part of Internal Corporate Restructuring.

Answer & Explanation:

During the life of a Company, any one or more of the following circumstances prompt for Company's restructuring: Injecting more working capital to meet the increased market demand. Scenarios where a company is unable to fulfill its commitments. If there is shortage in obtaining further credit from suppliers of raw materials, consumable stores, components, etc. and from other parties like those doing job work for the Company. Failure to utilise optimum capacity for lack of liquid funds. Financial restructuring involves rearrangement of its financial structure so as to make the Company's finances more balanced. Every Company targets to strike a balance in ever changing business environment.

Topics: Corporate Restructuring

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