In this thesis, we focus on a certain chosen topic of bankruptcy, including the causes of business insolvency, effects and formation, and some discussions regarding the law that had implemented here in our country. Failure is defined as the state of total lack of a particular qualitative value. Being bankrupt is a very serious thing. A person must hand over their assets, including their home, to their trustee. If they couldn't or didn't want to pay, they could file for bankruptcy. You will be forced to risk everything you own in your business to unwind all your debts and losses in your business. It is the legal status of an individual or company unable to pay outstanding debt. It is a status that can only be granted by a state or federal court. Bankruptcy will negatively affect your credit and future ability to use the money. It can prevent or delay the foreclosure of a home and the repossession of a car. It can also stop wage garnishments and other lawsuits from creditors trying to collect debts. We have conducted several studies through the use of accounting books and journals referring to the causes and formation of this crisis. There are many aspects that have been considered why a business leads to failure. Based on our research there are some companies that voluntarily declare that the business has gone bankrupt for some reason. One reason a company files for bankruptcy is low demand for sales and revenue. There are many factors why a particular business or corporation ends up bankrupt. Some of the causes are that the expenses are higher than the capital of the company. Capital is one of the most important concepts in banking. Capital is the amount of cash and other......half of paper......researched, we have combined all the details in the most synchronized way to produce a vivid study on this research. Works Cited Nilsen, Kim., “Keeping Fraud in Our Sights.” American Institute of Accountants, Inc., 2010, pp.20-27.Singleton, Tommie, “Watch Against Cyber ​​Theft.” American Institute of CPAs, Inc. 2006, pp.33-35. Schamotta, Justin, “Philippine Bankruptcy Laws.” Retrieved from http://www.ehow.com/list_6635219_philippine-laws-bankruptcy.htm.Bulkat, Baran, “What Type of Bankruptcy Should You File? Chapter 7 vs. 13”. Retrieved from www.alllaw.com/articles/nolo/bankruptcy/wich-type-chapter-7-chapter-13.html.“Aman Future Scam Connection.” June 25, 2013, retrieved from http://newsinfo.inquirer.net/43.639/the-aman-futures-scam-connection.“Enron Corporation.” Retrieved from https://www.uwosh.edu/llce/conted/lir/course-listings/Enron%20Scandal.pdf.