Internal Causes of Albanian Enterprises Bankruptcy
Internal Causes of Albanian Enterprises Bankruptcy

Summary/Abstract: Studies on the causes of enterprises bankruptcy have significantly increased due to the impact on several stakeholders (financial managers, shareholders, customers, suppliers and creditors,employees, etc., consequently causing a significant impact on the economic development of the country in which the enterprise operates) and due to the high direct and indirect costs incurred. Given that external causes (those related to the environment in which the enterprise operates) are out of the enterprise control, this paper will be focused only on internal causes of bankruptcy, which are directly influenced by the decisions made by management. In this regard, we have divided internal causes in two main groups: financial causes and non-financial causes. Financial causes are mainly linked to the decisions made by financial managers on cash and financial resources management, while nonfinancial causes mainly refer to the decisions made by management on the recruitment of staff(including senior managers and all other staff), and the lack of the planning activity as well.

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