What does the term "internal solvency" refer to?

Internal solvency refers to a company's capacity to meet its short-term financial obligations using its own internal resources, primarily generated from its core business operations. It focuses on the ability of a company to cover its immediate financial commitments, such as paying off its current liabilities (e.g., accounts payable, short-term loans) and operational expenses (e.g., salaries, utilities), without relying on external sources of funding.