Piecing Together The Credit Checking Jigsaw

Published on 20^th May 2022

Companies House is a government department that was set up in 1844 to act as a central register for limited companies.  More than 14m limited companies have been registered by Companies House over the past 178 years.  10m of those companies were registered in just the last 20 years.  Of course many of those companies have since ceased to exist and the actual ‘live’ register of companies currently stands at about 4.9m companies.  

The register is public so anyone can search for limited company information, at no cost, at https://find-and-update.company-information.service.gov.uk

“Recent statistics released by Companies House reveal that the pandemic didn’t have a detrimental effect on the overall growth of the limited company register which means that businesspeople had enough confidence to continue incorporating limited companies despite the challenging trading conditions,” Lisa Cardus, Founder Top Service Ltd.

It’s worth noting that Companies House is just a repository for information. Companies House does not check the veracity of the data that is filed.  There is a disclaimer on the Companies House website that states:

“We carry out basic checks on documents received to make sure that they have been fully completed and signed, but we do not have the statutory power or capability to verify the accuracy of the information that companies send to us.  The fact that the information has been placed on the public record should not be taken to indicate that Companies House has verified or validated it in any way.  When Companies House examines accounts it only makes basic checks on them, for example to ensure that the appropriate documents are there, that they are for the correct financial year and that they have been signed”.

It is impossible to gauge how much of the data stored at Companies House is inaccurate, incomplete or even false.  It is likely to be a very small proportion of the total information and there is no doubt that data stored at Companies House plays an important part in the credit checking process when extending credit to a new limited company customer.  There is, however, no need to be completely reliant on publicly filed limited company data.  

Credit reference agencies can add value to the credit checking process above and beyond the Companies House data.  At Top Service Ltd we specialise in construction sector credit referencing so we have a wealth of data that relates to the trading histories of companies in the sector going back 30 years.  In addition to historical information we have up-to-the-minute trading experiences from our network of 3,000 clients, in effect, a national grapevine of live credit information.  We also utilise our specialist IT systems and the instincts of our credit experts to highlight and investigate suspicious activity.  Our experienced credit investigators carry out in-depth investigations to ensure that our clients minimise their chances of incurring a bad debt.

Contact our helpdesk team today on 01527 518800 to discuss how Top Service can support and help you protect your business.