Contingency planning for a downturn in the economy: a treasurer’s checklist

This briefing note, originally issued in 2008, has been updated in December 2013, post financial crisis.

It is intended to aid the treasurer in thinking about and planning for a downturn in the economy or sustained lack of liquidity in financial markets and the effects on your company. Even if your industry and company are in good shape, you will still want to review these notes when considering how your customers, suppliers, competitors and potential acquisition targets may be affected and how they may respond. Planning for how to exploit the opportunities when as a downturn eventually comes to an end is important too.

The briefing looks not just at the financial fundamentals including cash and balance sheet management, risk and funding availability, but also how the business strategy and plans may need adapting to new circumstance. Many points raised are good housekeeping at any stage of the economic cycle.

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