Our Bankruptcy MOR Services

Monthly Operating Reports (MORs) are a crucial requirement for any business that files for Chapter 11 Bankruptcy in the United States. MORs are detailed financial reports that provide transparency into your company’s financial operations during Chapter 11 bankruptcy. These reports are submitted every month and can be very time-consuming.

When you partner with Remote Quality Bookkeeping, we prepare and file your monthly MOR documents.

Profit and Loss Statements-Bankruptcy MOR Services

Profit & Loss Statements

A profit and loss statement, also known as an income statement, provides a summary of your business revenues, expenses, gains, and losses over the month.

Balance Sheets-Bankruptcy MOR Services

Balance Sheets

A balance sheet provides a snapshot of your company’s financial position at a specific point in time (e.g., the last day of the reporting month). It presents all assets, liabilities, and equity so creditors and courts can see your progress.

Cash Flow Statements-Bankruptcy MOR Services

Cash Flow Statements

A cash flow statement details the sources and uses of cash during the month, providing insight into your ability to generate and manage cash. This includes day-to-day operations, repayments of debt, and more.

Accounts Payable-Bankruptcy MOR Services

Accounts Payable

Accounts payable represent the amounts your business owes to its suppliers, vendors, and creditors. It includes unpaid bills and obligations that the debtor must settle.

Accounts Receivable-Bankruptcy MOR Services

Accounts Receivable

Accounts receivable represent the amounts your customers or clients owe you for products or services. These are outstanding invoices awaiting payment.

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Chapter 11 Bankruptcy Frequently Asked Questions

Chapter 11 bankruptcy is often referred to as “reorganization bankruptcy” because it allows businesses to restructure their financial affairs and continue operating while addressing their financial difficulties.

Businesses file for Chapter 11 bankruptcy for a variety of reasons, including:

  • Debt Overload: A business may accumulate substantial debts, including loans, unpaid bills, and liabilities, making it difficult to meet its financial obligations. Chapter 11 provides a framework for negotiating with creditors and restructuring debt payments.
  • Financial Distress: Businesses facing financial distress due to declining revenues, economic downturns, or unexpected expenses may turn to Chapter 11 to stabilize their finances and develop a plan for sustainable operations.
  • Asset Protection: Filing for Chapter 11 bankruptcy can help protect the business’s assets from foreclosure, repossession, or legal actions by creditors. It provides an automatic stay, which temporarily halts collection efforts and legal proceedings.
  • Continuity of Operations: Chapter 11 allows a business to continue its operations while reorganizing its finances. This can be essential for preserving the value of the business, maintaining customer relationships, and preserving jobs.
  • Debt Repayment Plan: Through Chapter 11, a business can propose a reorganization plan that outlines how it intends to repay its creditors. This plan may involve extending the repayment timeline, reducing interest rates, or even reducing the total debt owed.
  • Lease and Contract Modifications: Chapter 11 allows a business to renegotiate leases, contracts, and other obligations that may be burdensome. This can include terminating unprofitable leases or modifying contract terms to align with the business’s financial capabilities.
  • Sale of Assets: In some cases, a business may choose to sell some of its assets as part of the reorganization process. This can help raise funds to pay creditors and streamline the company’s operations.
  • Equity Retention: Existing shareholders or owners may wish to retain ownership and control of the business. Chapter 11 can provide a mechanism for them to do so while addressing the company’s financial issues.
  • Breathing Room: Chapter 11 provides a temporary reprieve from creditor actions, including lawsuits, collection efforts, and foreclosure proceedings. This “breathing room” allows the business to focus on financial restructuring.
  • Legal Protection: In cases of complex financial disputes or litigation, a business may file for Chapter 11 to consolidate legal actions and resolve disputes in a controlled and structured manner.

Chapter 11 bankruptcy is typically available to businesses of all sizes, including small businesses. There are no specific debt limits, but eligibility depends on your ability to propose and execute a feasible reorganization plan.

Filing for Chapter 11 provides an automatic stay, which temporarily halts creditor actions, including lawsuits and collections. Your business can continue to operate while you work on a reorganization plan.

MORs are detailed financial reports that provide insight into your business’s financial performance during Chapter 11. They are required by the court and help creditors and the court monitor your progress and adherence to the reorganization plan.

MORs typically include profit and loss statements (income statements), balance sheets, cash flow statements, and details on accounts payable and accounts receivable. These reports should be prepared accurately and reflect your business’s financial condition.

MORs are typically filed on a monthly basis. It’s essential to meet the filing deadlines to maintain compliance with bankruptcy requirements.

Failure to file MORs or meet deadlines can result in legal consequences, including dismissal of the bankruptcy case, loss of bankruptcy protection, or sanctions from the court. It’s crucial to prioritize timely and accurate reporting.

In some cases, you may request an extension for filing MORs, but you should do so promptly and provide a valid reason. Extensions are granted at the court’s discretion.

Small business owners often work with bankruptcy attorneys, financial advisors, and accountants who specialize in Chapter 11 cases. These professionals can guide you through the process, help prepare MORs, and assist in developing a reorganization plan.

The duration of a Chapter 11 case can vary widely depending on its complexity and the speed at which a reorganization plan is developed and approved. It can take several months to several years to complete the process.

Remote Quality Bookkeeping Services

Ready to streamline your accounting and payroll processes? Look no further than our professional outsourced accounting and payroll services company! Our dedicated team in Wells, Maine provides cost-effective, efficient, and accurate services for small businesses and franchises nationwide.

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