THEORETICALLY GO TO THE REVEALING OF THE ESSENCE, PROBLEMS AND SUCCESSIONS OF BUSINESS BANKRUPTCY

Abstract

The company occupies an important position in the country's economy and solving social problems at various levels. Entrepreneurship fills state and local budgets, develops the country's economy and foster business relations in all scopes of activities. However, in current economic circumstances, there are more and more cases in which companies lose their ability to meet their obligations and face bankruptcy. This becomes an important issue for the countries’ economic development; therefore, more and more scholars dealing with economic and financial issues demonstrate their interest in the topic of negative trends identification in the business development and recovery from bankruptcy. Thereat research related to the causes and consequences of crises in the enterprise gains relevance. Ukrainian business also faces this problem as business owners are forced to constantly adapt to possible negative economic changes amid frequent economic crises. Sometimes organizations fail to meet budgetary and fiscal requirements for doing business that leads to bankruptcy of an enterprise. Bankruptcy itself is a part of market relations that identifies uncompetitive enterprises. Nowadays businesses are often exposed to difficulties that worsen their performance. Financial diagnostics of the enterprise and crisis prevention, sometimes even bankruptcy prevention, became topical for enterprises. Such issues at enterprises can be caused by various factors, such as the unstable economic situation in the country, changes in legislation, and management negligence. Preventing a threat is an important and at the same time a difficult step. Businesses may not always be able to fully overcome this complex issue, nevertheless, it can be identified and prevented in a timely manner by developing a system of preventive measures. Bankruptcy information is crucial as it will help to identify business problems and prevent severe economic consequences. Effective management based on awareness regarding the nature, causes and legal nuances of bankruptcy will help to reduce the impact of external factors or predict its occurrence.