Financial Warning Signs
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Financial Warning Signs
Say you were about to take a job at a flight school as a CFI. Before you paid the money to get current, go down for the interview, or to relocate, whatever, what questions would you ask to assess whether the school could be on the brink of shutting it's doors? Would there be any signs or signals that would tip you off?
(Before you respond that a school in trouble wouldn't be hiring CFIs, wasn't this the case with Summit? They posted a call for CFIs just a few months ago.)
(Before you respond that a school in trouble wouldn't be hiring CFIs, wasn't this the case with Summit? They posted a call for CFIs just a few months ago.)
Hovering AND talking
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Credit check them for a start. You'll probably have to pay but try Dun & Bradstreet or Experian (I think they're also in the US).
When I worked for an insolvency practice in the 80s, it was the joke that any company which refurbished its reception area would go bust within the year - seemed to work empirically then
Think Polly Peck and Azil Nadir 
Cheers
Whirls
When I worked for an insolvency practice in the 80s, it was the joke that any company which refurbished its reception area would go bust within the year - seemed to work empirically then
Think Polly Peck and Azil Nadir Cheers
Whirls
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Interesting
I would have never thought of credit checking a business. Do you just ask for a credit report on Company ABC? Presumably many debtors, little available credit, and frequent missed payments would be what you're looking for. Thanks for that suggestion.
Hovering AND talking
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A credit check will typically show a score (out of 100) and a maximum credit that any supplier should allow them. I would be wary of any score less than 50%. The reports will also give details of any court judgments (i.e. have suppliers had to take legal proceedings for payment) and possibly the number of days which the average supplier can expect to be paid in. They are generally easy to read and interpret.
Cheers
Whirls
Cheers
Whirls
Ask for the last six monthly P&L reports - signed by the MD.
If they're expecting you to shell out to get current I don't think its an unreasonable request.
PS on a tangent, I requested a copy of my credit record recently, just out of curiosity. Came back blank. I haven't had a loan since '87 when I borrowed 1,300 to buy an Alfasud...
It seems I would have great difficulty securing credit should I want it as I'm not an habitual borrower... 
Strange World.
If they're expecting you to shell out to get current I don't think its an unreasonable request.
PS on a tangent, I requested a copy of my credit record recently, just out of curiosity. Came back blank. I haven't had a loan since '87 when I borrowed 1,300 to buy an Alfasud...
It seems I would have great difficulty securing credit should I want it as I'm not an habitual borrower... Strange World.
Last edited by mini; 26th Sep 2009 at 22:21.
Hovering AND talking
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But don't be offended if they say "no". A business's current management accounts is commercially sensitive information and what's to stop the prospective employee running off to a competitor with the info?
Besides, a P&L won't tell you much except whether they're making a profit or loss; cash flow (or lack thereof) is what kills a company.
If any prospective employee asked me for the information, I'd say "no".
MD: Hey Whirls, what's the profit this month?
Whirls: What would you like it to be?
Cheers
Whirls
PS - Mini, the reason for that is because you've not had any credit, therefore the credit lenders have no record of you to know how well you could repay a loan or not. Credit check reports for individuals do not assess how many thousands you have in the bank, just how good you have been in the past at paying off loans.
Besides, a P&L won't tell you much except whether they're making a profit or loss; cash flow (or lack thereof) is what kills a company.
If any prospective employee asked me for the information, I'd say "no".
MD: Hey Whirls, what's the profit this month?
Whirls: What would you like it to be?
Cheers
Whirls
PS - Mini, the reason for that is because you've not had any credit, therefore the credit lenders have no record of you to know how well you could repay a loan or not. Credit check reports for individuals do not assess how many thousands you have in the bank, just how good you have been in the past at paying off loans.
Whirlygig
With us it was never give credit to a Co with its own flag & Q Award to industry, there was also a suggestion that if there was a Co. helicopter run a mile.
With us it was never give credit to a Co with its own flag & Q Award to industry, there was also a suggestion that if there was a Co. helicopter run a mile.
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Jump online and check with your local county recorders office for liens and other such filings filed with the county recorder or recorders where the school has operations. Also, check the appropriate local courts web site and look for lawsuits, judgements and other legal filings. Lastly, you can always look at Pacer which will provide you with copies of federal court actions. Pacer is about .08 per page but the search is free. Pacer is for federal actions versus county actions.
