negative net worth investment & finance definition
A
condition in which a company’s liabilities exceed its assets plus shareholders
equity. Negative net worth can occur because a company borrowed too much money
and subsequently had its income fall as its debt payments rose. It also may
occur if the value of assets declines.
See negative net worth in Wall Street Words
An excess of liabilities over assets. If the assets are fairly valued, a firm with negative net worth could sell all its assets and then be unable to pay all its outstanding loans. Thus, nothing would remain for the owners. Also called deficit net worth.
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