Financial distress is when a company is vulnerable to the ability to maintain its financial commitments related to operating expenses (i.e., timely vendor payments, leases and payroll), debt holders (i.e., lenders, noteholders), and capital expenditures.
Recognizing the Signs of Financial Distress
Diagnosing financial distress, and the ability to address the relevant issues, is a necessary role of board members and senior executives.

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