Why should I have a Financial Health Check?

I am often asked the question: Why should I have a Financial Health Check?

The short answer is it can save you money.

The longer answer and where the benefits can be found are as follows:

  • Reduce overdraft interest charges;
  • Repay loans earlier;
  • Reduce your exposure and risk attached to personal guarantees; and
  • Enable you to take out more from the business.

 When is the best time for the Financial Health Check?

 Normally I would suggest 2-3 months before your overdraft renewal date.

 What’s the problem I have never had a Financial Health Check in the past?

In my experience banks are still risk averse, and consequently, relationship managers are, even more than ever, re-evaluating the lending facilities on their customers’ accounts.

In particular they will look at the prices they charge you (interest rate, bank transaction charges and arrangement fees), the security they hold for you (debentures, fixed & floating charges and personal guarantees) and whether they are happy to continue to support you under the current arrangements.  They will assess your business’s risk based on their defined parameters, and will review such things as your financial results, the quality of the management information you provide to them, the sector you are in, the expectations of your future results, and the way you have managed your account in the past.

If a company has a poor credit rating, it will come home to roost eventually. 

What will I do for you?

I have access to an exclusive rating scorecard, which will appraise the bank’s likely view of your own situation.  I can complete that exercise with you, to assess your score.

If the results of the Financial Health Check show your business is likely to fall outside the normal criteria of the lender and may be subject to increased rates, costs or security requests, then I can suggest some actions – the higher the score, more urgent action needs to be taken.

If you believe I can help you in reducing the costs of and the risk to you of lending facilities and how those areas might be addressed, then please contact me, Andrew Watkin, by email: awatkin@assyntcf.co.uk or telephone: 07860 898452.

I look forward to hearing from you.

Assynt Corporate Finance Limited, Chartered Accountants, is a member of The Corporate Finance Network which means we can provide access to other accredited national firms.  We can also access additional Corporate Finance resources, particularly in the areas of advertising businesses for sale discreetly and accessing those lists for our clients who want to acquire business.

The information contained in this briefing is based on information available as at the date posted and may be subject to amendment.  It is written as a general guide and is not a substitute for professional advice.  You are strongly recommended to obtain specific professional advice from us before you take any action.  No responsibility for loss occasioned to any person acting or refraining from action as a result of any material in this briefing can be accepted by Assynt Corporate Finance Limited or its employees.




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