Company in financial trouble

1 August 2017

If you’re struggling to meet debt payments and cashflow is suffering, don’t panic! There are a number of options available to help turnaround the business if it is financial trouble. 



Cut costs and improve cashflow 

Update your cashflow model and use a daily template so you know exactly what is being spent every day. Keep a close eye on accounts and cut out non-essential costs. You’d be surprised by how many things you don’t need.

See here for more tips on cutting costs. 



Debtor collection

Collecting late payments is a vital part of the business but it can also be time-consuming. Ensure you have a suitable credit policy and always have agreements in writing. Verbal correspondence will make chasing debtors more difficult. 

Find out other ways to improve debtor collection. 

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Plan A or time to pay

If creditors are threatening legal actions, it’s worth looking at what we call, Plan A. This is an informal deal with creditors as a way to pay back debt over a relatively short time period. We may be able to arrange a Time To Pay (TTP) deal with HMRC on your behalf if you’re fallen behind on VAT and PAYE payments.



Company Voluntary Arrangement (CVA)

Similar to Plan A, a CVA is a formal deal made with creditors to ensure debt is repaid over a set time-frame. The arrangement protects your company from legal actions and is a powerful restructuring and refinancing tool. Unlike a Time To Pay deal, up to 60% of unsecured debt can be written off. For a detailed CVA guide, click here.



Pre-pack Administration

If the company is under threat from an aggressive creditor, selling the company in a pre-pack administration deal to a third party may be the best option. This ultimately gets rid of debt and allows the business to continue. It can end those sleepless nights quickly! Read out step-by-step guide here.



The Ultimate Guide For Worried Directors

The Ultimate Guide For Worried Directors

Worried about poor cashflow? How to win new work? How to pay wages on pay day? For expert advice on a range of issues download our free Ultimate Guide For Worried Directors today.