Where a company is deemed to be unable to pay its debts, this has a number of other effects in addition to the ability for a creditor to present a petition to wind it up. It also means that the directors are expected to discharge their duties in the best interest of the company's creditors rather than its shareholders; that transactions may be potentially vulnerable as voidable transactions, and that the right of creditors to set-off mutual debts may become impaired in relation to debts which are incurred during the period of insolvency.
