Originally Posted by ilnjscb

Once they dip, even one time, the death knell sounds. It may take years, but that first dip in to client's funds is a huge gulf. They always intend to pay it back. They become optimistic rather than realistic. One good month, a few more clients, etc.

The signs are always:

They become more difficult to reach. Similar to a consumer, they avoid the problem. If you'll just "get off their back and give them a few more months" they will "solve everything."
Average payable age lengthens inexorably, as more client funds are put toward operation, and they live off the "float"
A few clients, those who have a potential for larger cash flow, will be paid, until the end
Staff leaves, as internal tensions become unbearable.
Sometimes there is a magic "partner" that will save the day if everyone just chills out.

Then one day the difference between Meum and Tuum becomes completely indistinct, and the last funds are taken because they need to "get by". To avoid (in their minds) litigation and responsibility, they constantly repeat that the funds are coming, and they want to pay everyone.

They never do.

I'm not saying that is what happened here, but a creditee with good intentions releases tons of data, over communicates, shows in minute detail what went wrong and how it is atypical or resolved, and is generally accountable.