financial solvency

Financial solvency refers to a company's ability to meet its long-term financial obligations and pay off its debts when they are due. It indicates that the company's assets (what it owns) are sufficient to cover its liabilities (what it owes). Being solvent means the business is financially healthy enough to continue operations and avoid insolvency or bankruptcy. Essentially, it's a measure of the company's overall financial stability and capacity to sustain itself over time, ensuring it can fulfill its commitments without financial distress.