IRONIC FAITH

this is a philosophical position adopted by those who believe in their business model but also believe its naïve and dangerous to believe in accountants and professional advisers.

Their inner prophet [ profit ] sets up an implacable psychological drive to reshape the world according to the individual’s own inner necessity. Their problem solving strategies largely revolve around avoidance and a total lack of analysis of the fiscal situation. Lots of hand wringing but little to staunch the inevitable losses.

So lets look at some of the early warning signs of a business under stress:

reduced working capital, blown out creditors, ATO lapses, banking arguments, loan defaults, pricing failures, staff turnover, poor internal controls, no current financial data, too much stock on hand, too much WIP and no closures, poor billing and debtor policies, product offerings out of step with customers, tough competition, myopic leadership, unpaid employee entitlements, health issues with proprietor, matrimonial stress, contract disputes, legal action threatened, non compliance with operational laws, poor machinery and maintenance practices, no risk mitigation strategies, KPI’s trending adversely…….this list is endless. If you tick too many of these boxes you’d better get professional help IMMEDIATELY.