- The state of a company that does not have sufficient capital or reserves for the size of its operations. For example, this may be due to the company growing too quickly. Although such a company may be making profits it may be unable to convert these profits sufficiently quickly into cash to pay its debts.
Accounting dictionary. 2014.
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Undercapitalization — refers to any situation where a business cannot acquire the funds they need. An undercapitalized business may be one that cannot afford current operational expenses due to a lack of capital, which can trigger bankruptcy, may be one that is over… … Wikipedia
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undercapitalization — undercapitalized un‧der‧cap‧i‧tal‧ized [ˌʌndəˈkæptl aɪzd ǁ ər ] also undercapitalised adjective FINANCE if a company is undercapitalized, it has less capital than it needs in order to operate effectively and grow: • If you set up a store and you … Financial and business terms
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undercapitalization — See undercapitalize. * * * … Universalium
undercapitalization — noun Insufficient capitalization See Also: overcapitalization … Wiktionary
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undercapitalization — The state of a company that does not have sufficient capital or reserves for the size of its operations. For example, this may be due to the company growing too quickly. Although such a company may be making profits it may be unable to convert… … Big dictionary of business and management
undercapitalization — A situation in which a company does not have enough cash available to carry on its business … Business law dictionary
undercapitalization — A term used in reference to a business which does not have enough cash or capital to effectively carry on the business. See also thin capitalization … Black's law dictionary