| Company Financial Trouble |
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accounting
First Time Poster
Cash: $ 0.25
Posts: 1
Joined: 31 Oct 2015
Location: Boston
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| Company Financial Trouble |
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I joined a company 2 months ago as their Controller and it was apparent they were in trouble the moment a stepped in the door (funny, nothing about it came up in the interviews). They maxed out a 100K line of credit a year and a half ago and took out a 30K loan with an alternative lender 3 months before I arrived. Despite the loans, they are still in trouble, they are 90+ days with most of their vendors and making payroll is tight. They produced a loss the last two fiscal years, this year will present a profit of 50K. What are the odds we can obtain additional funding from a bank or increase credit limits with vendors ?
AR is fairly current. Sales are growing modestly. There are certainly issues with the spending with the CEO/owner (family members on the payroll, multiple car payments and country club memberships on the company dime). When I bring up the issues, I just get a noncommittal, run around response. I'm not sure if he's just in denial or if he knows full well the ship is sinking and intends for me to take the blame, since as the Controller, financial matters are my responsibility. So my questions are:
1. Do I stay on and help them, and if so, how ?
2. Do I jump ship before it hits the fan, and if so, how do I explain this to a potential employer ?
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Sat Oct 31, 2015 8:17 pm |
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oldguy
Senior Member
Cash: $ 751.85
Posts: 3656
Joined: 21 May 2006
Location: arizona
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Depends on the size of the 90-day AP - is it $1000 or $500,000?
And it depends on the size/slope of earnings forward. The $50,000 projection is in the right direction - but is it tiny (in relation to size of business) or significant?
As for company cars assigned to relatives - are the relatives good employees who utilize the cars for business? Or slackers that abuse their status?
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Sat Oct 31, 2015 9:57 pm |
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