Every
business transaction contains an element of risk, yet at the same time how
satisfactory are the mechanics for managing risk?
In recent
years we have witnessed just how costly the laissez faire attitude to risk and
burgeoning debt has been for many institutions be they large corporations or
smaller SME’s.
In the
never ending quest for larger profits many of the saner measures of business
were abandoned. An analysis of recent disasters from the subprime fiasco in the
US through to the Greek Debt debacle all have one common denominator – the
architects of these calamities went hurtling over the cliff like lemmings.
The UK is
now forecast to be close to losing its Triple AAA status with most forecasters
still failing to properly capture the negative impact of
"deleveraging" - or households, businesses, banks and the government
trying to cut their big debts – coupled with a serious risk of a further
worsening in the Eurozone's mess. Against this back drop it is questionable
whether even the anaemic recovery expected by the Office for Budgetary
Responsibility in 2013 will take place.
A forensic
analysis of your company’s current Debtors Book at this time might make for
uncomfortable reading but like most unpleasant tasks it should not be ducked.
Better to
take remedial action such as a write down whilst you are in control of your own
destiny rather than have a 3rd Party appointed to do it for you.
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