Why is short-term financial planning crucial for a company Provide an example of a company that has either undergone an insolvency event or is in financial distress due to poor short-term financial pl

Short-term financial planning is crucial for a company because it helps to ensure that the company has enough cash flow to cover its immediate expenses and obligations. Without proper short-term financial planning, a company can face cash flow problems, which can lead to insolvency or financial distress.

An example of a company that has undergone insolvency due to poor short-term financial planning is the retailer Toys "R" Us. The company filed for bankruptcy in 2017 after struggling with declining sales and mounting debt. One of the main reasons for the company's financial troubles was its inability to manage its short-term finances effectively. Toys "R" Us had taken on a significant amount of debt to finance its operations and was unable to generate enough cash flow to cover its debt payments and other expenses. As a result, the company was forced to file for bankruptcy and ultimately liquidate its assets