Warning Signs struggling businesses need to look out for: Part 3
9th July 2010
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There are different positions within a business, and depending where you sit, will depend on the warning signals you need to look out for. In the third part of our series, we highlight areas where a shareholder should be looking out.



  1. Targets/ budgets are regularly not met
  2. You have to introduce new directors or advisors
  3. The bank wants to introduce investigating accountants
  4. The board regularly asks for new investment
  5. Different answers to the same questions to different directors
  6. Your board fail to communicate financial information to you
  7. High staff and management turnover
  8. Autocratic leadership – is one person making all the decisions?
  9. Late management accounts, audited accounts and or annual returns
  10. The directors cannot agree to the best policy and/or appear to be at war with each other


The basic fiduciary duty of the directors is to inform the members at all appropriate times as to the company’s performance. However, few directors realise that when a business becomes insolvent, then the duty of care shifts from a duty to act on behalf of the shareholders to the body of creditors as a whole.

If you are private investor you should take advice from the "Business Casflow Expert" Rupen Shah. For more details go to http://uk.linkedin.com/in/rupenmshah

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