You’ve been doing business / works together, but things have gone wrong. What do you do?
Well, you will obviously develop a strategy to address this, whether that be by means of one or a combination of negotiation, adjudication, mediation or more formal proceedings.
However, it is worth bearing in mind that your opponent’s accounts can provide information to help with that strategy.
So, what should you look for?
- Check when your opponents’ year end/ half year end is. These two dates can put considerable pressure on companies and depending on the company performance in that financial year, it may be a good time to try to settle a dispute. Knowing when these dates fall, can give you an insight into your opponents tactics, allowing you to make an informed decision about your own tactics and strategy
- Has your opponent already made provision in their accounts for the claim? Have they reconciled themselves to making a loss or a payment for the dispute? This again could give an insight into their strategy and their views on prospects of success. There may even be a section of narrative regarding the figure they anticipate. Small companies only have to file abbreviated accounts which may not have this narrative (a small company meeting two of the following: a turnover of £6.5m or less; £3.26m or less on the balance sheet; or 50 employees or less).
- Depending on the amount in dispute, if accounts show trading difficulties that, long term, could lead to insolvency, it may become more imperative to attempt to settle.
Any formal dispute resolution process should always be part of a carefully considered strategy and accounts can provide a useful “behind the scenes” look at your opponent and a tool to help reach the best resolution for you.