Business Advisory — April 2025
Five financial red flags we see in growing businesses — and how to fix them
From thin working capital to unclear ownership structures, these are the issues that surface in almost every advisory engagement we take on once a business crosses $1M turnover.
Growth hides problems. While revenue is climbing it's easy to overlook the structural issues building underneath — until a slow quarter, a delayed receivable, or an unexpected tax bill brings them to the surface. In our advisory work with South Australian businesses, the same five red flags appear again and again once turnover crosses $1M.
Thin working capital is the most common. A business that looks profitable on paper can still struggle to fund payroll in a tight month, because margin and cash are not the same thing. Close behind are unclear ownership structures — arrangements that made sense at incorporation but now create tax inefficiency, asset protection gaps, and friction between the people who own and run the business.
The good news is that every one of these issues is fixable — and the earlier it's addressed, the cheaper the fix. If any of this sounds familiar, a structured review of your working capital, structure, and reporting is worth doing before the next growth phase locks the problems in.