How do you recognise when a business is heading towards a financial cliff edge? What and where is the edge? What steps can directors take to help manage and stay away from the edge?
In our latest insight, we address these questions and consider ways in which directors can manoeuvre through the various challenges facing businesses and keep business capital working. We consider possible threats to working capital, including the consequences of a material adverse change, breach of financial covenants and defaults, and provide suggested approaches that directors could take to address potential threats.
The key to managing working capital is, ultimately, careful planning, a sound understanding of legal parameters and open dialogue with key stakeholders.
