Counterparty reliability analysis and risk management: key factors in choosing a reliable counterparty
Disrupted deliveries, lost profits, cash flow gaps and reputational losses are just some of the problems caused by unreliable partners. We figure out how to properly check counterparties and assess risks in order to avoid troubles and minimize damage.
Recently, the consulting company "Corporate Mechanics" shared a case where a documented check of the counterparty's reliability helped the organization avoid paying an additional 100 million rubles from the Federal Tax Service. The tax service considered identical contracts, a low tax burden and a lack of resources on the part of the counterparties as a sign of fictitious transactions. The court decided that to exercise due diligence, it is enough to check the counterparties using open sources and the tax service cannot hold the company liable because of its suspicions about its partners.
This case from judicial practice shows that when working venezuela mobile database with a counterparty, analyzing its reliability reduces business risks, which include more than just problems with the tax authorities.
5 risks when working with unreliable counterparties
Let's consider what risks a company exposes itself to if, for some reason, it does not check the reliability of its counterparty.
Financial risks. An unscrupulous counterparty may fail to pay for goods, take an advance payment and fail to provide a service. In addition, bankruptcy or seizure of assets also entails risks of non-fulfillment of contracts. As a result, the business incurs direct or indirect losses: it pays penalties under related contracts and costs of litigation.
Tax risks . The Federal Tax Service leaves the verification of the counterparty's reliability to the business. If it turns out that the company has not carried it out properly, the tax authorities can add the company to the lists for in-depth checks, refuse deductions and benefits, impose fines on the organization, its director and accountant, and even initiate a criminal case.
Legal risks. Include breach of contractual obligations towards third parties, criminal or administrative liability for non-compliance with tax legislation. For example, due to a cash gap, a company may fail to pay wages to employees and violate the labor code.
Banking risks . Banks classify clients by their level of reliability, and transactions with suspicious counterparties can lead an honest company to the blacklist. In this case, its access to certain services may be restricted, a loan may be denied, or accounts may be blocked.
Reputational risks . Due to a connection with an unreliable counterparty, a company may get into a public scandal, reduce the quality of goods or services. This will negatively affect the reputation, which leads to a loss of profit, hinders the development of the company, entails additional costs, for example, for marketing and ORM (Online Reputation Management or online reputation management).