In its november 2009 press release discussing third quarter, Ask an Expert

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In its November, 2009, press release discussing third quarter financial results, the construction management and consulting firm Hill International specifically cited an increase in bad debt expense as a drag on otherwise improved operating profits. Hill provides its services globally to companies involved in large construction projects.

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Discuss the effects of an international real estate recession on construction projects and why this macroeconomic event would affect a company's bad debt expense. Who is on the other side of a company's bad debt expense? How does this expense affect the income statement and the balance sheet? How could an analyst following the global construction markets use a company's disclosure on bad debts to better understand the industry?

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