While Austal does have more liabilities than liquid assets, it also has net cash of AU$199.7m. The cherry on top was that in converted 97% of that EBIT to free cash flow, bringing in AU$30m. So we don't have any problem with Austal's use of debt. The balance sheet is clearly the area to focus on when you are analysing debt. But ultimately, every company can contain risks that exist outside of the balance sheet. For example Austal has 3 warning signs (and 1 which is significant) we think you should know about.