Insight Associates provide outsourced accounting and Finance Director services to ambitious and growing businesses. We work as your only resource or with existing staff to give you complete financial support including monthly management accounts, high level financial advice, robust controls and financial systems, funding and business planning, payroll & compliance, VAT returns and statutory compliance.

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Friday, October 09, 2009

The law won't help you ...

Despite our spending a considerable amount of time telling businesses about managing the credit they give to their customers, even we get caught out occasionally!

We have very unfortunately recently had to sue a former client for unpaid fees. The situation should have been quite simple even though they did not seem to be able to communicate with us properly. We had a clear contract, clear payment terms and there was no dispute over the amounts owed (well not that they had ever told us!).

So would you not think that getting paid in these circumstances should be quite straightforward?

If only!

The exercise that at long last that has got us to an agreement with our former client (ratified by the court) has in the end cost nearly £3,000 in legal fees and taken the best part of a year to complete. And now we have had to agree to a payment plan, so we still have to wait for our money!!

The moral of the story here is don't rely on the legal system to collect your debts for you. Yes occasionally as we have found it is necessary, but as a system it simply does not work! It is slow and expensive and at the end of the day very much works in the debtors favour! The debtor (the one that owes you your money!) has so many opportunities in the system to find reasons not to pay and raise reasons for disputes it is simply crazy!

When will the legal system be sorted out so that businesses can collect the money they are rightfully owed, easily, cheaply and quickly?

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Insight Associates, Insight House, Riverside Business Park, Stoney Common Road, Stansted Mountfitchet, Essex, CM24 8PL, UK
Tel: +44 (0)1279 647447 Fax: +44 (0)1279 814512
Insight Associates is a trading name of Financial Catalysts Limited. Registered in England and Wales Number: 5670047. Registered Office as above. Disclaimer | Cookies