With a report in accordance with the German IDW S11 or a comparable standard in other countries, you can have the crisis stage of your company proven. In particular, you receive a statement on the existence of reasons for opening insolvency proceedings, i.e. insolvency, imminent insolvency and arithmetical over-indebtedness.
The basis for such a report (in Germany: in accordance with IDW S11) is a financial plan that is based on the current financial status of the company and covers a planning period of 13 weeks.
In Germany, insolvency exists if at least 90% of all due liabilities cannot be paid as agreed. In other countries this limit may differ. If this requirement is not met but can be proven to be met again within a maximum of three weeks, this is a payment stoppage, not an insolvency. In this case, the temporary lack of payment is not a reason for insolvency.
Arithmetical over-indebtedness exists if the company’s assets do not cover the liabilities due.
In each country, the local regulations should be applied.