I think some of the info being banded around re CTC's finances seems a bit subjective. Two statements made by FANS were:
"negative cash flow for the last two years"; and
directors being forced to write why they believe the business is still a going concern - not normal".
I also got hold of CTC's accounts and noticed the cash outflow figures, however if you look at the detail of their cash flow statement you will see that the "net cash outflow for capital expenditure" for the same two years totals over £3.6m, and yet the total cash outflow over the same period totals £2.5m. It seems that the cash outflow was a result of acquiring new assets then?
I showed their accounts to a mate who is training to be an accountant who told me that apparently the other place to look at to assess a company's cash flow is the value attributed to "net cash inflow from operating activies". Apprarently as long as this is positive, then it shows that the company is generating cash from its day to day activites. Although the figure dropped in 2008 from 2007, CTC's accounts seem to show that they did generate cash from all their activities.
I also asked my mate about the going concern part, as I wondered about that too. He told me that all accounts now have to have a statement in them which give the directors' opinion of the company to operate as going concern. I checked out HSBC Bank's accounts (all 472 pages!!) and they have made a similar disclosure on page 331:
"Since the Directors are satisfied that the Group and parent company have the resources to continue in business for the foreseeable future, the financial statements continue to be prepared on the going concern basis"
so it would seem that this type of statement is normal.
I guess we don't have info on what is currently the position of CTC right now, but you would think they would be foolish to keep sending pilots out to New Zealand if they thought they were about to go bust.