I was having lunch with a banker and they were telling me about the problems they were having with a nameless client.
It seems that their client works in a perceived specialized field; it’s actually not, its retail with a small educational component. So they were referred to a NY CPA firm that seemingly specializes in these types of clients.
The client only sees the CPA once a year when they stop in town to pick up all of their specialized clients information in the Chicago area. They don’t actually talk to this CPA during the year; all of the work is done by back room people that they never meet nor have any contact with.
The client was left to their own devices to determine how best to work the financing of some work to be done on their facility and purchase for their business. They opted for personal credit cards as the option of choice.
So, now they were looking for a line of credit for the business, but their business and personal credit reports are not sterling. One of the problems of co-mingling.
Now they are being forced to redo their home mortgage to address the outstanding credit card issues. That will assist with some of the personal issues of their credit, as well as giving them more time to co-ordinate cash flow.
Once the personal side is done, then they get to tackle the business side.
If they had a real relationship with their CPA they would have had actual advice and been better able to handle the issues properly when they arouse rather than well after the fact as clean-up.
In my opinion they got the wrong referral, and they still think the world of their CPA whom they don’t interact with…