INSOLVENCY 2025/2026 ACCURATE
QUESTIONS AND (COMPLETE VERIFIED
ANSWERS) 100% GUARANTEED DISTINCTION
Statutes that govern insolvency - ANS-Bankruptcy (Scotland) Act 2016 & Insolvency Act 1986.
What is insolvency? - ANS-The inability of the debtor to pay back the creditor.
Which then requires the appointment of a third party to liquidate the debtors assets and distribute
them to the creditors in statutorily prescribed manner
What two broad categories are there for insolvency? - ANS-- Personal insolvency = anything not a
company
- Corporate Insolvency = company debtors
What are the three possible states of insolvency? - ANS-- Practical insolvency
- Absolute insolvency
- Apparent Insolvency
Practical insolvency - ANS-debtor unable to pay debts as they fall due. For companies see s122(1)(f) and
123(1)(e) of the Insolvency Act 1986.
Absolute insolvency - ANS-total liabilities exceed total assets. See s123(2) of the Insolvency Act 1986
gratuitous alienations and unfair preferences
QUESTIONS AND (COMPLETE VERIFIED
ANSWERS) 100% GUARANTEED DISTINCTION
Statutes that govern insolvency - ANS-Bankruptcy (Scotland) Act 2016 & Insolvency Act 1986.
What is insolvency? - ANS-The inability of the debtor to pay back the creditor.
Which then requires the appointment of a third party to liquidate the debtors assets and distribute
them to the creditors in statutorily prescribed manner
What two broad categories are there for insolvency? - ANS-- Personal insolvency = anything not a
company
- Corporate Insolvency = company debtors
What are the three possible states of insolvency? - ANS-- Practical insolvency
- Absolute insolvency
- Apparent Insolvency
Practical insolvency - ANS-debtor unable to pay debts as they fall due. For companies see s122(1)(f) and
123(1)(e) of the Insolvency Act 1986.
Absolute insolvency - ANS-total liabilities exceed total assets. See s123(2) of the Insolvency Act 1986
gratuitous alienations and unfair preferences
