The CEO of Strong Tie received the draft 2008 financial statements for the company, which was a manufacturer of structural connectors used in the building industry. He began to question the companies performance when he compared the statements to those of previous years. How were profits holding up given the intense price competition in the industry? Were attempts to lower costs through more automation paying off? Were the current problems in the U.S. housing market going to continue to reduce demand for connectors? How would lenders react to this poor performance? Was the companies financing in danger? After discussing the matter extensively with Strong Ties CFO, it was decided that an outside consultant should be hired to provide an independent analysis of the companies recent performance and to provide suggestions for future action.
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