As you will know from this week’s news, Carillion Plc have gone into Compulsory Liquidation. Their collapse leaves a creditors book of around £1.5 billion. That’s owed not just to staff but to suppliers and sub-contractors, so it’s likely that somebody/some company which you know will be affected.
They have 450 government contracts in the UK and thousands of staff – not just here in the UK but worldwide.
What will Happen to Ongoing Contracts?
The Government has picked up its own contracts and with it the staff, to enable them to provide continuity of public services, until further notice.
One thing that is clear about everything else is that, at the moment, it’s unclear exactly what will happen next.
As a result of the Liquidation, all creditors will have to wait until the process has been completed to see whether they will get any payment on the debt they are owed. As Carillion is such a large company this will probably take over two years to resolve.
What should you do if you are owed money by Carillion?
According to the latest BBC News report, Carillion spent £952m with local suppliers in 2016 and used an extensive network of small firms, who are now waiting to learn if they will be paid.
If the debt from Carillion Plc doesn’t give you any cash-flow issues then you’re in a good position. It’s annoying to lose money, especially when the industry giant has been making small suppliers wait 120 days to get paid. But its business as usual for you and you’ll be notified by the Liquidator in due course.
If the debt from Carillion means that you WILL have cash-flow issues, then you need to take action NOW.
Get the Right Advice
The right advice for your business should be tailored to your particular needs. There’s no ‘one size fits all’ answer to this problem.
As business advisors, at Jones Harris we are well equipped to help you with the practical financial and accounting side of the issue. You may need to explore insolvency, selling the business or a whole host of other scenarios. In which case, we will point you in the direction of one of our network of trusted colleagues, who will be able to help you.
The earlier that you take advice the better equipped your business will be to avoid becoming insolvent itself.
There is a little more brief information on the .gov website at this link
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