Legal News

Cash flow and contractors

Published on: 24 November 2015

Table of contents

  • To what extent can developers assess the financial stability of a contractor before appointing them?
  • Are there concerns contractors can present themselves as more financially stable than they really are by transferring capital between projects?
  • To what extent do the standard construction contracts (JCT, NEC3 etc) affect the financial stability of contractors?
  • Would the sector benefit if contractors had to have a certain amount of capital reserves to ensure they could survive short-term financial instabilities?
  • Are sources of credit sufficiently open to contractors? What could be done to improve the financial stability of contractors?

Article summary

Construction analysis: Sarah Elliott, partner at Wedlake Bell, looks at some of the cash flow issues faced when appointing contractors in the construction industry.

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