Company record checks?

riveratom

Hi folks,

Just wondering if folks on here frequently make use of the CRO record checks to suss out companies you may be looking to do business with? I have never downloaded company records before, but I presume they are fairly handy for getting a handle on how a company does its business (I'm talking about Solocheck and those kind of services).

Peterdalkey

Pretty much shag all useful info unless you subscribe, in which case getting a proper credit rating report is much more useful at similar money.

riveratom

Peterdalkey wrote: »

Pretty much shag all useful info unless you subscribe, in which case getting a proper credit rating report is much more useful at similar money.

Does it not give a breakdown of income, profit and loss and creditors, etc - even at a high level? The sample reports I've seen on Solocheck (€8 a pop) seem to provide this detail anyway.

Peterdalkey

riveratom wrote: »

Does it not give a breakdown of income, profit and loss and creditors, etc - even at a high level? The sample reports I've seen on Solocheck (€8 a pop) seem to provide this detail anyway.

Private SMEs do not have to file profit figures or trading margins etc etc. thus credit reports are much more useful if you are thinking of doing business with them.

riveratom

Random question, but if a company has negative net assets, is that necessarily a 'bad' thing? Let's say Company Q which doesn't have many capital requirements has 40k in cash but 50k in liabilities, is that maybe an indication that all is not well?

I know there are a million variables that could be at play, but just wondering.

Peterdalkey

Somebody is going to get burned, Revenue for sure I would guess!

riveratom

Peterdalkey wrote: »

Somebody is going to get burned, Revenue for sure I would guess!

I'm thinking yes?! Red flag in terms of dealing with them I guess...?

What's seems even more sus is that this is a company where they would have basically no capital requirements - virtual services!

All sorts going on out there I reckon. Looking at another company with incomplete details on their return, and a load of zeroes on their account details return, where details of their assets, cash etc should be?! Surely that's a bad sign?!

dbran

Hi

Just started using this crowd for all my cro searches

https://www.search4less.ie

So far they seem to be very good and the fact that they only charge an annual fee of €195 means they are very reasonable if you are doing a lot of searches every day.

As for the other query, it is not always the case that an insolvent company is on the skids. It depends on whether of not the company is profitable, who the money is owed to, what is says in the audit report etc. You need to do a lot of other background checks as well eg check their website, google them,search other companys owned by the directors.

Its worth noting that a lot of companies fail because they run out of cash and not because they are insolvent and loss making.

Best regards

dbran

Peterdalkey

dbran wrote: »

Hi

Just started using this crowd for all my cro searches

https://www.search4less.ie

So far they seem to be very good and the fact that they only charge an annual fee of €195 means they are very reasonable if you are doing a lot of searches every day.

As for the other query, it is not always the case that an insolvent company is on the skids. It depends on whether of not the company is profitable, who the money is owed to, what is says in the audit report etc. You need to do a lot of other background checks as well eg check their website, google them,search other companys owned by the directors.

Its worth noting that a lot of companies fail because they run out of cash and not because they are insolvent and loss making.

Best regards

dbran

That is good value indeed, However it is an issue for those of us not so expert in company accounts analysis with abridged reporting etc and no trading figures . We are paying nearly that per month for similar but with payment histories and credit rating/worthiness numbers ( Ireland & UK) from http://www.creditsafe.ie

pedroeibar1

riveratom wrote: »

Hi folks,

Just wondering if folks on here frequently make use of the CRO record checks to suss out companies you may be looking to do business with? I have never downloaded company records before, but I presume they are fairly handy for getting a handle on how a company does its business (I'm talking about Solocheck and those kind of services).

If you intend to sell on credit you need to ask much harder questions than this. A set of accounts from the CRO are (a) abridged and (b) historic, so they are worth SFA.

Even if you are given on a plate a full set of accounts from a potential customer (+/- impossible to obtain if you are trying to do business with them) they will tell you very little, as you need to look behind the figures. The assets ( premises, etc) probably are overstated given today’s market values, and the debtors may contain a load of debt that will be irrecoverable.
A substantial number of non-retail business failures in the last year were due to the business being unable to withstand a series of bad debts.

Obtaining a credit report from a reputable supplier is a no-brainer. The better credit reporting agencies update their records regularly, they often have a collection activity from which they input slow payers, etc.

What is the potential bad debt amount you could suffer? Next, how much turnover do you have to generate to recoup that amount? Now, how much are prepared to pay for a few GOOD credit reports? A few hundred quid is nothing in comparison to the downside.