Much needed breathing space or kicking the can down the road?

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Today,  9 December 2020, the government announced it intends to reinstate the temporary suspension of the use of statutory demands and winding-up petitions until 31 March 2021.  This does not come as much of a surprise and is good news for companies who are doing all they can to steer through the pandemic and remain viable as a business once we are through these unprecedented times.

Here is a link to the announcement which will leave many directors breathing a sign of relief.

https://www.gov.uk/government/news/government-gives-businesses-much-needed-breathing-space-with-extension-of-insolvency-measures

As head of  DebtFast, I speak with many people from credit controllers to finance directors who are sharing with me the impact of the virus and their daily battle with constant calls for payment of invoices that they are unable to authorise for payment. The message seems to be that creditors patience is running thin and the pandemic as a reason for cashflow issues is being met with less sympathy as businesses large and small attempt to maintain cashflow by delaying payments.

Whilst today will be welcome news to many and is certainly a good thing for all directors taking all steps to ensure their business will remain viable, I would add a word of caution to the directors that are living in hope that they will come out the other end with no real certainty of strategy or prospects of this being a reality.

My advice to all directors that are concerned is to pick up the phone and seek advice.  Knowledge is power and the sooner advice is sought the better the prospect of your business emerging through this crisis and the more options that will be open to you.

If you have concerns, please telephone Penny Daisley on 01727 738246 or email on ped@debenhamsottaway.co.uk for a confidential discussion on your concerns.