This company has already not posted any annual accounts for three consecutive years.
Such companies automatically score -5.
Doing business with such companies is highly inadvisable.
They also run the risk of the courts dissolving them.
Judicial dissolution:
On application by any interested party or the public prosecutor's office, and unless matters are remedied while proceedings are underway, the court of commerce in whose jurisdiction the company has its registered offices can pronounce a company dissolved if it has failed to post its annual accounts for three consecutive financial years.
Negative returns for two years is a major heads-up to the Court of Commercial Enquiry at the Court of Commerce.
An established business which loses money year in, year out has no future anyway.
New businesses may often show a negative return (high startup costs, low sales at first, ...) but things should clearly be getting better after two years.
Profitability and liquidity together give a good idea of how a company is faring.
| Liquidity | Profitability |
|---|
| + | - |
| + | Healthy | Chronically sick |
| - | Temporarily sick | Dying |
(**)
(**) Source: Handbook "Financial analysis process" by Hubert Ooghe and Charles Van Wymeersch (Intersentia)
