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Business Administration

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Publication/Presentation Date

Winter 9-24-2018


Financial distress is a hot topic these days in finance and the project’s health is very important for investors as well as management. Investors posit money in those projects which are financially healthy as the risk of default is minimized for them, while management must be able to identify causes of distress which can be controlled by taking different measures (Khurshid, 2013). However, the fact that many projects encounter financial distress requires further investigation. This paper deals with the elements of project financial distress as its major signs and sources as well as it suggests ways to eliminate the consequences. The results provide an effective way to resolve financial distress by restructuring it. Apparently, this option should be preferred as long as it is considered to be more advantageous than liquidation. The report also shows that restructuring can be looked at in four broad categories: managerial, operational, asset, and financial one. The paper describes each category; it determines the right time to use each of them; it explains their benefits and last; it provides guidelines to consult when implementing them.

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