When dealing with everyday business you may come upon (or should at least) a question of whether your company is able to continue. Questions you may ask are similar to if there are enough liquid assets to pay up your creditors, is there room for required investments etc. Or possibly also the question whether you’ve been following all regulations and the possibility of the authorities coming and asking for a closure. Okay, maybe not closure, but nonetheless, they may ask something so impossible that you’re forced to close down.
Such questions and possibilities should be somewhere in your head at all times. Not so intensive that you think about them all the time, but still, whenever you’re planning for a new investment or doing something out of the ordinary, think twice and consider the implications of the action to your company’s ability to continue as a going concern.
The reason why I suggest you think about it constantly is actually pretty obvious – if you think in advance, you may be able to prevent some situations. You may be able to realize that you don’t actually have enough resources for investing into new equipment as of yet or that you may benefit more from simply trying to ask a loan before putting your own funds under tangible assets. There are more possibilities you can choose from in the beginning as compared to those few or none when things go south.