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KSM Blog | Katz, Sapper & Miller CPA

Reasons for Corporate Failure: Is Your Manufacturing Company at Risk?

Posted 5:16 PM by

The Cass Business School in London recently published a report on the causes of corporate failure in the modern era titled "Roads to Ruin: A Study of Major Events: Their Origins, Impact and Implications."  The report outlines seven risk factors that lead to corporate failure.

In a time of economic uncertainty it is important for manufacturing companies to analyze these risk factors and determine if they are currently affecting operations. If they are not currently affecting operations, then it is important to determine if the company has a system in place that will prevent occupancies in the future.

The seven risk factors include:

  1. Ineffective Board
  2. Risk Blindness within the Board
  3. Inadequate Leadership on Ethos and Culture
  4. Ineffective Communication
  5. Overly Complex Organization
  6. Inappropriate Incentives
  7. "Glass Ceiling" for Information

As we continue to work through these difficult economic times, make sure that your company is addressing these risk factors so that you don't find yourself in a corporate failure situation.

About the Author
Justin Hayes is a director in Katz, Sapper & Miller’s Audit and Assurance Services Group. Justin works with clients to help ensure accurate financial reporting, keeping an eye on their bottom line, helping them avoid risk and maximize efficiencies. Connect with him on LinkedIn.

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