Contracts had not been costed properly and the accounting system was non existent. The company was leaking money and when we scratched the surface it was clear that large debts had built up.
Case Study 1 – Security Services Company
Security Services
Location: Nottinghamshire
Established: 2006
Turnover £640,000
Debts: PAYE & VAT (primarily)
The company grew rapidly and was continuing to win new contracts. Whilst turnover was strong the actual profit margin was poor and in fact in some cases the true cost of providing the service were not being met.
Contracts had not been costed properly and the accounting system was non existent. The company was leaking money and when we scratched the surface it was clear that large debts had built up.
Fundamentally the business was sound and we were able to get the accounting system right and through monthly monitoring and meetings they are now back on track. With regard to the debt (the Inland Revenue were threatening to wind the business up) we were able to arrange a CVA for an initial amount of £720.
Once we had explained the situation the Inland Revenue were in fact helpful throughout and understood that a realistic amount initially would allow the business to recover.
This amount was affordable and bought the company time, after 12 month payments increased to £1,080 a month but by that time the business was back on track.
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