Share a financial update with a supplier without hiding its limits

The supplier asks for evidence rather than another promise

A supplier wants financial information before considering further credit. Ask your advisers what can appropriately be provided and how to explain it accurately. Do not send a favourable extract that leaves the recipient with a misleading picture. Equally, avoid forwarding unrelated confidential material without considering authority and relevance. The update should have a clear purpose and an honest description of its limits.

Identify the requested decision

Imagine a supplier asking a contractor for current management accounts and a cash forecast. Clarify the actual request and the entity concerned. Tell the accountant what decision the supplier is considering. An old annual report may not answer a question about next month's payment capacity, and a forecast for a related company may not describe the business placing the order.

Protect records while preparing the response

business.gov.au recommends secure record handling and protection against unauthorised access or changes. Use an appropriate verified recipient and sharing method. Keep the original source records intact. Ask advisers about any necessary exclusions or redactions, making the scope clear rather than removing material in a way that disguises liabilities or changes the meaning of the information supplied.

Source: business.gov.au: Record keeping

Date the information and label uncertainty

In the contractor example, state the accounting period, preparation date and whether reconciliations remain incomplete. Identify forecast assumptions and unconfirmed receipts. Do not describe estimated figures as actual results or a proposed funding arrangement as available money. The supplier should be able to understand which parts are recorded facts and which still depend on future events.

Keep the trading decision separate

Obtaining or supplying a financial pack does not establish that new credit is appropriate. If the company may be insolvent, seek qualified advice promptly about its obligations and options. Have the actual proposed purchase assessed. Do not tell staff that the supplier's willingness to review information is an approval to continue ordering on unchanged terms.

Retain what was sent and follow up accurately

Keep the exact version, recipient and response with the account record. Provide corrections through the appropriate process if a material error is found. A useful financial update supports an informed discussion without concealing uncertainty, but it cannot replace a properly advised decision about what commitments the company can responsibly undertake.