CONCLUSION

Throughout this chapter, we tried to approach the notion of failure of the financial, economic and legal point of view, then from the point of view of the costs of the financial distress.

Also, it would be important to give a per­spective on the procedure of liquidation and on the costs which it generates to be able to choose between plan of reorganization and procedure of liquidation.

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KEY TERMS AND DEFINITIONS

American Stock Exchange (AMEX): The second-largest stock exchange in the U.S.

Bankrupt: Firm, or corporation that has been declared insolvent.

Cash Flow: A measure of a company’s fi­nancial health.

Cost: The total money, time and resources associated with a purchase or activity.

Financial Distress: Tight cash situation in which a business, household, or individual cannot pay the owed amounts on the due date.

New York Stock Exchange (NYSE): The largest stock exchange in the U.S.

Profitability: The ability to earn a profit.

Risk: The quantifiable likelihood of loss or less-than-expected returns.

This work was previously published in Global Strategies in Banking and Finance, edited by Hasan Dincer and Umit Hacioglu, pages 369-379, copyright 2014 by Business Science Reference (an imprint of IGI Global).