"Declaration of solvency": Law. A statutory declaration made by the directors of a company prior to its winding up or liquidation. The declaration of solvency states that the directors: 1. Have made a full enquiry into the affairs of the company, and2. Have formed the opinion that the company will be able to pay its debts in full within a period of not more than 12 months from the date on which the winding up or liquidation commences.