• T. H. Donaldson


For years banks assessed the credit standing of their borrowers on the basis of ‘liquidation analysis’, also often referred to as ‘gone-concern analysis’; some still do. Liquidation analysis, in its simplest form, values a company on what it would be worth in liquidation, i.e. at forced-sale prices. Unless this valuation shows that the company could pay its debts even in liquidation, the bank will not lend; or at least that is the theory.


Cash Flow Balance Sheet Trade Creditor Equity Investor Equity Holder 
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Copyright information

© T. H. Donaldson 1992

Authors and Affiliations

  • T. H. Donaldson
    • 1
  1. 1.European Credit Policy CommitteeJ. P. MorganUK

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