In administration: what does this mean?

Rail maintenance company Jarvis has called in administrators as the cash dried up and lenders refused to offer the company further credit. With Jarvis’ creditors no longer prepared to offer it the money it needed to continue as a going concern the company said it had no option but to enter administration, and trading in its shares on the London Stock Exchange have been suspended.

Following negotiations with the company's secured lenders, it has today become clear that sufficient support will not be extended to the company to enable it to continue trading as a going concern. As a consequence, the directors now have no option but to take steps... to place the company, and certain of its subsidiaries, into administration."

But how can the support of lenders and creditors be so important to a business that withdrawal of that support leads to insolvency? Cash is, as ever, King – our finance training programmes put this into context and explore these implications.