Below are the signs that a company is in trouble. Some of these should be an indicator to the directors but some will be apparent to companies extending credit as well. If any are pertinent to your company you should seek advice from turnaround specialists.

Bank 

• The overdraft is always at the limit.
• The bank always wants more information.
• The bank has returned cheques.
• The bank has refused to increase the overdraft or wants its facility reduced.
• The bank refuses to provide a term or EFG loan.
• The bank wants to introduce investigating accountants for an independent business review. Note, the banks uses the big six so fees, which are paid by the company, are huge with amounts of £6,000+ the norm.
• The bank asks for increased security.
• The bank wants personal guarantees or increase them.
• The bank wants a charge on personal property.
• The covenant with the bank is often contravened. Continue reading →