Resources
Credit analysis guides
for UK businesses
Plain-English guides on reading company accounts, detecting financial distress, and making smarter credit decisions — written for credit controllers, accountants, and procurement teams.
Wrongful Trading in UK Law: What Directors Must Know
Wrongful trading under s.214 of the Insolvency Act 1986 makes directors personally liable for debts incurred after insolvency becomes inevitable. Here is how the law works and what it signals for credit risk assessments.
What Happens When a UK Company Is Struck Off? A Guide for Creditors
When a UK company is struck off, it ceases to exist and its assets pass to the Crown — leaving creditors with no simple route to recover unpaid debts. Here is what to do and when.
Creditors' Voluntary Liquidation (CVL) UK: A Complete Guide for Creditors
A creditors' voluntary liquidation is the most common corporate insolvency process in England and Wales. Here's what it means for unpaid creditors, how the distribution works, and how to detect one early.
Administration vs Liquidation: Key Differences Explained for UK Creditors
Administration and liquidation are the UK's two most common formal insolvency procedures. Here's what each one means for your unpaid invoices and what to do next.
What is a Company Voluntary Arrangement (CVA)? A UK Credit Controller's Guide
A Company Voluntary Arrangement (CVA) is a formal insolvency procedure that lets a struggling UK company repay creditors at a reduced rate while continuing to trade. Here's what it means for your invoices.
Beneish M-Score: Detecting Earnings Manipulation in UK Company Accounts
The Beneish M-Score combines eight ratios to flag the probability that a company's reported earnings have been manipulated — a vital cross-check before extending credit to a fast-growing UK business.
Springate S-Score: A UK Insolvency Prediction Model Explained
The Springate S-Score is a lesser-known but well-validated insolvency model that pairs with the Altman Z-Score and Piotroski F-Score to triangulate UK credit risk.
Piotroski F-Score: A 9-Point Financial Health Checklist for UK Credit Analysis
The Piotroski F-Score is a 9-point checklist that classifies UK companies as financially strong, moderate, or weak using binary signals across profitability, leverage, and operating efficiency.
Inventory Turnover Ratio and Its Credit Risk Implications for UK Companies
The inventory turnover ratio shows how quickly a company cycles through its stock — and a falling ratio is one of the earliest signals of cashflow stress in manufacturing, retail, and distribution businesses.
Asset Turnover Ratio: Measuring Operational Efficiency for UK Companies
The asset turnover ratio measures how much revenue a company generates per £1 of assets. Here's the formula, UK sector benchmarks, and why it's one of five components in the Altman Z'-Score.
EBITDA: Formula, UK Benchmarks, and Why It Matters for Credit Decisions
EBITDA is the most widely used operating cash proxy in UK corporate lending. Here's the formula, sector benchmarks, and how the EBITDA coverage ratio tells you whether a business can service its debts.
Net Profit Margin: What Is Healthy for UK SMEs?
Net profit margin is the bottom-line test of whether a UK SME is genuinely viable. Here's what healthy looks like by sector, how to spot margin compression in filed accounts, and how it should influence your credit decisions.
Gross Profit Margin Formula and Industry Benchmarks for UK Businesses
Gross profit margin is one of the earliest signals of commercial deterioration — often visible in accounts 12–18 months before operating profit turns negative. Here's the formula, UK sector benchmarks, and how to use it in credit decisions.
Working Capital Management Best Practices for UK Businesses
Poor working capital management is one of the top causes of UK company insolvency. Here's how to optimise debtors, inventory, and creditors — and what to look for in filed accounts before extending credit.
Return on Equity (ROE): Formula, UK Benchmarks, and What It Reveals
Return on equity (ROE) measures how efficiently a business converts shareholders' capital into profit. Here's the formula, UK sector benchmarks, and what ROE — positive or negative — reveals about credit risk.
Debt-to-Equity Ratio UK: Calculation, Safe Thresholds, and Credit Risk
The debt-to-equity ratio measures how leveraged a UK company is relative to its equity buffer. Here's the formula, sector benchmarks, and how to use it in credit decisions — with worked examples in £.
Interest Coverage Ratio: What Lenders Look For in UK Companies
The interest coverage ratio shows how many times operating earnings cover debt interest. Here's the formula, UK sector benchmarks, and how to use ICR to detect debt service stress before it becomes bad debt.
Cash Conversion Cycle: How to Calculate and Improve It for UK Companies
The cash conversion cycle shows how many days a company funds its own operations before collecting cash from customers. Here's the formula, UK sector benchmarks, and how a rising CCC signals cashflow stress.
Days Sales Outstanding (DSO): Formula and UK Benchmarks Explained
Days Sales Outstanding measures how quickly a company collects cash from customers. Here's the formula, UK sector benchmarks, and how to use DSO to spot late payment risk before it becomes bad debt.
Quick Ratio (Acid Test) Explained for UK Credit Controllers
The quick ratio (acid test) strips out stock and prepayments to give a more conservative view of short-term liquidity. Learn the formula, sector benchmarks, and how to apply it in UK credit decisions.
Current Ratio Formula and Interpretation for UK SMEs
The current ratio is the most widely used liquidity measure in UK credit analysis. Learn the exact formula, what healthy looks like by sector, and the key mistakes credit controllers make when using it.
How to Run a Free Company Credit Check in the UK
You don't need to pay a credit bureau £20 per report. Here's how to run a thorough company credit check using free UK government data sources — and what to look for in each.
Late Filing at Companies House: What It Means for Credit Risk
Accounts that are overdue at Companies House are statistically one of the strongest predictors of insolvency — yet many credit controllers overlook this free, publicly available signal.
Altman Z-Score for UK Companies: A Complete Guide
The Altman Z-Score is the most widely used quantitative model for predicting corporate bankruptcy. Here's how to use it for UK private companies — and what its limitations are for SMEs.
5 Red Flags in UK Company Accounts Every Credit Controller Must Know
Most bad debts are foreseeable. These five red flags in company accounts give credit controllers the early warning they need — before a £20,000 invoice becomes uncollectable.
The Gazette: UK Insolvency Notices Explained
The Gazette publishes UK insolvency events before they appear on Companies House — giving creditors a critical early warning window if they know where to look.
Director Background Checks for UK Companies: A Practical Guide
The financial health of a company is only half the picture. The directors running it — their history, their other company roles, and their sanctions status — can tell you just as much about credit risk.
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