Joined: 10-Apr-2003 Posts: 1161
From: Norrköping, Sweden
@Yabba
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Yabba wrote: @samface
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Sure, a company may declare themselves insolvent to a court as a means to get help with sorting out the debts. In fact, as Kronos mentioned earlier, it's against the law to not do it in some countries, like Germany for example. However, if a company doesn't do it because they think they are still able to get out of the insolvency on their own, it would take a petition filed in a court of law to and a judge's decision to have a company declared insolvent.
Thats exactly why courts can declare a company bankrupt when it is in the state insolvent. Now we are talking about insolvent (the state) and not bankrupt (the legal term).
OK, let's try this again:
It would require a court of law to determine if a company is in the state of insolvency and declare it bankrupt.
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Oh, you're one of those guys who think we don't actually need auditor's, right?
Look, he was only talking about the skill to tell if the bottom line is less than or higher than zero. Not how to get there. If you start reading peoples post you might actually understand what they are trying to tell you.
Eeehm... haha! Sorry for laughing but, the thing is, you are accusing me of not reading and not understanding what people say while at the same time failing to see what I'm trying to say. In the context of corporate book keepings, your skill as a layman to "tell if the bottom line is less than or higher than zero" is completely irrelevant. Where "the line" actually ends up after an auditor has done your book keeping can be completely different than by the estimates of a layman.
Maybe you have money on the bank that you think proves that your company's financial status is "above the line" but an error in your book keeping says that they are owed to someone else. Or the opposite might just as well be true; you don't have any money on the bank but an error in your book keeping says you payed way too much taxes last month and need only collect it from the state. These things happen all the time, even though it's criminal to not have your book keepings in order.
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samface 
