A company emailed regarding a survey work that they needed. So I said send over the details so we can pore over the scope of works and prepare a quote. So she emailed back and said before they could do that, we need to send over some documents for their evaluation to see if we are capable of doing the work. So the list of documents needed by them are
1. tax returns for the past 2 years
2. financial statements for the past 2 years
3. list of projects with contract prices
4. list of personnel with salaries & benefits (to check on insurance coverage of the workers)
5. list of equipment & date of purchase
I was scratching my head and was wondering who was paying who? Why are they asking for my financial statements? Do they want to know if I am capable of paying them? I thought it was the other way around. They were supposed to prove to me that they are capable of paying my fees, right?
You think I am being audited and this is just a ruse? Email address looks valid.
Sounds like a scam.
They call it a Pre-Qualification process. Apparently, it's like an investigation process that approves a list of contractors from which they will select a company for their projects. It hastens the bidding process. Several other companies have this process but this is the fiirst time that someone asked for tax, financial statements and personnel salary information. I will email them back saying this violates our privacy policy or something similar.
The warning sign for me is that they are not requesting proof of a minimum amount of liability insurance.
I dealt with something similar.?ÿ It turned out that the request came from?ÿ a young lady who had recently been promoted and was afraid to admit the didn't quite understand the process.?ÿ?ÿ
Perhaps you could approach it by providing proof of your professional liability insurance and a statement outlining your ability to complete projects on time and within budget, and see what happens.
?ÿ
During the 32 plus years in business I have provided the type information requested of you. I provide everything EXCEPT "1. tax returns for the past 2 years and 3. list of projects with contract prices. 1 is taken care of in 2 and 3 is in total contract prices only.
Most of the time this is for for six figure contracts, anything lower and I would be skeptical and these requests are to indicate your company is solvent and financially capable to complete the proposed project.
Google the company and look at their financial well being. They may not be up to your standards. ?????ÿ
They should provide the identical information to you about their company first in order that you can tell if they are worthy of being your client.
In the past I have provide some of that information.?ÿ But these have been for very large projects and not quite in the detail you were asked.?ÿ For those it makes sense, they want to make sure you have the capability and resources to finish the project. I have no problem supplying a list of similar projects with ballpark fees or an equipment list (without price and purchase date).?ÿ As for the financial data, by the time we have gotten around to those questions we've been well underway with the project scoping and have had some direct contact with the potential client.
Before that point they can check you out on D&B and run a credit check if they are that worried about my ability to perform.
What Cow said...
When they say no, you say no.
Answer: you go first.
The only folks that need that are federal alphabet soup and criminals (arguably some crossover there, different thread). If it's the feds they csn get all of that and more without asking. If it's criminals you don't want them to have it..
Everything is a business decision...
Would I provide that to an ENR top ten contractor as part of their pre-qualification package for a $250K+ public works project.?ÿ Yup
Would I provide that to a ENR top design firm as part of a multi-year teaming arrangement. Yup
Would I provide that to a "company emailed regarding a survey work". Very, very doubtful?ÿ
?ÿ
My answer would be simple:?ÿ "No, I cannot handle your project.?ÿ Call someone much larger."
In my opinion they are looking to use you to enhance their ability to get financing for them to do the project. Farther down the line they will look for you to indemnify them if the go belly up. Run, don't walk away.
Paul in PA
I run in different circles. None of this would be necessary or expected.?ÿ E&O possibly but damn if I would put my employees through an (potential) examination process by others.?ÿ I would consult my attorney, my CPA, my employees and my wife before I responded.?ÿ
This is fairly common for some of the large construction projects we bid/work on....with the exception of the financial statements.?ÿ Usually we're asked to provide a bonding rate in which case the financial statements and bank balances have to be shown to the bond provider. So I suppose that's better than handing them over to an unknown entity.
It's fairly intrusive but the prime contractor wants assurances we can handle the work.?ÿ Or it's a requirement of the project for subcontracts over a certain value.?ÿ
Scam or not I would not submit to that type of periscope activity.?ÿ I stay busy without it.
Licensed Land Surveyor
Finger Lakes Region, Upstate New York
There is no reason to expose you, your company or your people to such an invasive vetting process.
Too much personal data on you and your company that should never be released to anyone.
It is hard to convey the big laugh of he'll no in words and that is all they would ever get from me.
Only people that have me under an unbreakable contact that pays me mega monies could ask me for that info.
good luck