The company has gone into insolvent liquidation. The wrongful trading provisions are confined to liquidation; they cannot be invoked by an administrator or administrative receiver. A company goes into insolvent liquidation if it goes into liquidation at a time when its assets are insufficient for the payment of its debts and expenses of the winding up. This is the balance sheet test described in an earlier chapter. “Debts and liabilities” includes prospective and contingent debts. It is thought that whether the company is in fact insolvent according to this test is to be determined in the light of all facts know when the matter comes before the court, whether or not they were known at the time the company went into liquidation. The use of hindsight creates no problem in this situation, for what the court has to consider in an application under s.214 is whether there is a net deficiency of assets and, if so, whether and how the delinquent director should be required to contribute to the assets.