Checking financial health of company

[Tiggy]

Hi Guys

You may have seen me on the general discussion forum. I thought it would be good idea to post this particular question here as well

Upon asking to see a company's financial reports in order to decide whether to franchise with them I have been told:


QUOTE *Our company's year end was extended to February 2005 the accounts are therefore not due for filing until November 2005. However, I can confirm that the company wrote off all its development costs in the year and made a very small profit*UNQUOTE


Surely there still must be information that they can show to me?

Any help much appreciated

Tiggy

[Ozzy]

They should be able to show you some management accounts. However, these are rather unstable in the sense that they have not been legally filed. I'd recommend getting a solicitor/accountant involved and carry out some professional due diligence on the company before getting too involved.

[Tiggy]

Thanks Richard

I have decided to give this one a miss altogether - far too much ducking and diving going on, it's bad for my nerves!
Tiggy

[Ian J]

Surely there still must be information that they can show to me?

It would seem that the company have management accounts and probably draft accounts as well that they could show you if they wished otherwise they wouldn't have been able to make the statement that they made a "small profit"

Whether they choose to show you or not is another matter as they are not legally obliged to do so. There is also a question as to why they deemed it necessary to extend their accounting period that needs answering too.

[coolengineer]

yep get an accountant to do an audit on them, he will be able to spot things you don't