We help you find out whether your company is viable, with what measures and over what timeframe, and to present it with realistic assumptions to banks, shareholders, investors or creditors.
Reviewed by Controlaudit's audit team · Firm registered with the ROAC under no. S1604 · Updated 13 October 2026
A viability plan answers a simple question with numbers: can this company, or this project, generate enough cash to meet its commitments and create value? It starts from the current economic and financial position, sets explicit assumptions on sales, margins, costs, investment and financing, and projects the profit and loss account, the balance sheet and, above all, the cash position for the coming years.
We advise management in two types of situation. In business plans, for new projects, investments or raising finance, we analyse the robustness of the assumptions, the consistency of the business model and its ability to create value, testing them against sector benchmarks and investor expectations. In financial restructuring, when recurring losses, cash pressures or excessive debt arise, we design the measures needed to restore balance and turn them into a plan that can be negotiated.
The value of the plan lies in its being realistic and verifiable. An optimistic plan will not convince a bank or a creditor, nor the auditor, who must evaluate management's assessment of the company's ability to continue as a going concern. We explain this in our article on NIA-ES 570 and going concern. Once the plan has been approved, we can support its monitoring through our participation in the management committee.
No legislation imposes a general obligation to have a viability plan, but the law does set obligations and deadlines when a company runs into difficulties, and in all of them the plan is the tool for making data-driven decisions.
Grounds for dissolution due to losses. Art. 363.1.e) of the Spanish Companies Act requires the company to be dissolved when losses reduce equity to below half of the share capital, unless the capital is increased or reduced sufficiently and provided that insolvency proceedings are not required. The directors must call a general meeting within two months (art. 365) and, if they fail to do so, may be jointly and severally liable for subsequent company obligations (art. 367). They are not liable for those debts if, within that period, they notify the court of negotiations with creditors to reach a restructuring plan or file for insolvency (art. 367.3).
Pre-insolvency law. The Spanish Consolidated Insolvency Act (TRLC, Royal Legislative Decree 1/2020 of 5 May), as amended by Law 16/2022, allows the debtor to notify the court of the opening of negotiations with creditors and to obtain court approval of a restructuring plan when the debtor is in a situation of likelihood of insolvency, imminent insolvency or actual insolvency (art. 584). There is likelihood of insolvency when it is objectively foreseeable that, without a restructuring plan, the debtor will be unable to meet the obligations falling due over the next two years on a regular basis (art. 584.2); insolvency is imminent when the debtor foresees being unable to meet them within the following three months (art. 2.3). The restructuring plan may modify assets, liabilities or equity, include the transfer of business units or of the business as a going concern, and any necessary operational change (art. 614).
In certain cases the court appoints a restructuring expert (art. 672), for example when requested by the debtor or by creditors representing more than 50% of the affected liabilities, or when court approval is sought for a plan imposed on classes of creditors or shareholders who did not vote for it. There is a special procedure for micro-enterprises (art. 685). In any event, the debtor must file for insolvency proceedings (concurso de acreedores) within two months of becoming aware, or when it should have become aware, of its actual insolvency (art. 5.1).
Our role is economic and financial: corporate and insolvency decisions require legal advice, with which we coordinate. If we are the company's auditors, before accepting the engagement we analyse the incompatibilities under the Spanish Audit Act (Law 22/2015, arts. 14 to 16); in that case our involvement may be limited to evaluating management's forecasts as part of the audit of annual accounts.
| Situation | Rule | What it means |
|---|---|---|
| Equity below half of the share capital | Art. 363.1.e) LSC | Grounds for dissolution, unless there is a sufficient capital increase or reduction and provided that insolvency proceedings are not required. |
| Grounds for dissolution exist | Arts. 365 and 367 LSC | Call a general meeting within two months; otherwise, directors are jointly and severally liable for subsequent debts. |
| Likelihood of insolvency (two-year horizon) | Arts. 584 and 585 TRLC | Possible notification of negotiations with creditors to reach a restructuring plan. |
| Restructuring plan | Arts. 614 et seq. TRLC | Modification of assets, liabilities or equity, sale of business units and operational changes; possible court approval. |
| Actual insolvency | Art. 5.1 TRLC | Duty to file for insolvency within two months of becoming aware, or when the debtor should have become aware, of it. |
| Micro-enterprises | Art. 685 TRLC | Special procedure for debtors with fewer than ten employees and turnover below €700,000 or liabilities below €350,000. |
Assessment of the collections and payments system, payment policies to improve cash flow, analysis of finance costs and of solvency, liquidity and leverage ratios, and reclassification or refinancing of loans.
Preparation or review of business plans for new projects, investments or fundraising, testing the assumptions against sector benchmarks and investor expectations.
Short-term cash flow forecasts, for example over 13 weeks, and over twelve months or more, reconciled with the budget and the debt maturity schedule.
An economic plan that serves as the basis for negotiations with financial institutions and creditors and for pre-insolvency tools, in coordination with the debtor's lawyers.
Identification of alternative sources of financing, including grants, with support in the application and follow-up.
Economic analysis of capital increases, debt-to-equity conversions, mergers and divisions, and tax planning for the restructuring, supported by the auditor's special reports where required by law.
Analysis of the economic, financial and equity position, cash and debt, and identification of the causes of the difficulties. Indicative timing: 1 to 2 weeks.
Defining with management the assumptions on sales, margins and costs and the operational and financial measures, with owners and a timetable.
Model of the profit and loss account, balance sheet and cash flow for the plan's horizon, with base and downside scenarios and sensitivity analysis.
Assessment of whether the company can meet its obligations, over what timeframe and with what financing or debt restructuring needs.
Support in presenting the plan to banks, shareholders or creditors, and periodic monitoring of actual performance against the plan.
When there are recurring losses, working capital is negative, cash problems are expected, debt is to be renegotiated, or a bank or investor asks for one. The earlier it is prepared, the more options the company will have.
A business plan describes and quantifies a project or strategy in order to attract investment or financing. A viability plan focuses on demonstrating whether the company can meet its obligations and with what measures, and is used mainly in situations of difficulty or refinancing.
It does not guarantee it. It shows whether the company is viable and with what measures, and it is the basis for negotiating with creditors or for using the pre-insolvency tools of the Spanish Insolvency Act, such as notification of negotiations or a restructuring plan.
Under art. 584.2 of the Spanish Consolidated Insolvency Act (TRLC), it exists when it is objectively foreseeable that, unless a restructuring plan is reached, the debtor will be unable to meet the obligations falling due over the next two years on a regular basis. It makes it possible to act before insolvency occurs.
It is a statutory ground for dissolution (art. 363.1.e LSC). The directors must call a general meeting within two months to dissolve the company or to remove the cause, for example through a capital increase, and if they fail to do so they may be liable for subsequent debts. Legal advice should be sought as soon as the situation is detected.
A professional appointed by the court in the cases set out in art. 672 of the Spanish Consolidated Insolvency Act, for example at the request of the debtor or of creditors representing more than half of the affected liabilities. The expert must have legal, financial and business knowledge and experience in restructurings.
Before accepting, we analyse the incompatibilities under the Spanish Audit Act. If the engagement could affect our independence, we will not accept it, and our role will be to evaluate your forecasts as part of the audit of annual accounts.
Legislation cited on this page, linked to its official text:
General information updated on 13/10/2026. It is not a substitute for an analysis of your specific case.
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