In this thesis, we focus on some selected topic of bankruptcy, including the causes of business insolvency, its effects and formation, and some discussions regarding the law that had implemented here in our country. Bankruptcy is defined as the state of complete lack of a particular quality value. Being bankrupt is a very serious matter. A person must turn over their estate, including their home, to their trustee. If they can't or won't pay, they can declare bankruptcy. You will be forced to risk everything you own on your business to dissolve all your debts and losses in your business. It is the legal status of an individual or business unable to repay outstanding debts. It is a status that can only be granted by a state or federal court. Bankruptcy will negatively affect your credit and your future ability to use the money. This can prevent or delay home foreclosure and car repossession. It can also stop wage garnishments and other legal actions by creditors attempting 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. Many aspects have been examined to explain why a business leads to bankruptcy. According to our research, some companies voluntarily declare that their company went bankrupt for certain reasons. One of the reasons why a company declares bankruptcy is low sales demand and revenue. There are many factors why a certain business or company leads to bankruptcy. One cause is that expenses exceed the company's capital. Capital is one of the most important concepts in banking. Capital is the amount of cash and other...... middle of paper ...... researched, we have merged all the details in the most synchronized way possible to produce a vivid study on this research. Works Cited Nilsen, Kim., “Keeping Fraud in the Crosshairs.” American Institute of Accountants, Inc., 2010, pp.20-27. Singleton, Tommie, “Guard 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 versus 13.” Retrieved from www.alllaw.com/articles/nolo/bankruptcy/which-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.