Debt obligations are funds that can be received by the borrower company in the future. Based on the terms of the existence of debt obligations, the delay on them, the volume of measures taken to repay them, we can talk about their actual value. Some debt obligations may be classified as uncollectible debts, the repayment of which, accordingly, is not possible.
In the conditions of investment processes and obtaining financing, a company that has debt obligations on its balance sheet can evaluate them or accept the value of the business without taking into account the volume of debt obligations in whole or in part. The company can take measures to recover debt obligations or foreclose on collateral (activate other forms of debt payment), which will determine the value of the company’s capital qualitatively. The capital received in this way can be taken into account when determining the company’s property mass and its resource security during investment processes.
Since debt repayment measures require the expenditure of various resources (time, money, staffing, etc.), in order to speed up the processes, distressed assets (debts) can undergo the procedure of preliminary and intermediate valuation costs and liquidity. Such an assessment should be carried out taking into account legal documents drawn up within the framework of the relationship between the creditor and debtors, documents for collateral, etc. The legal analysis carried out simultaneously with the assessment can also indicate the prospects for debt restructuring, attracting guarantors or beneficiaries to non-payment problems.
In the case of taking into account the specifics and qualitative study of the issues about debt obligations, various investment processes are qualitatively carried out.