Lincolnshire County Council is observing the financial position of the contractor responsible for delivering work on the Lincoln Eastern Bypass after it issued a profit warning.
Carillion was awarded the £99 million contract to build the new £96 million road and work has already begun on site.
The company issued a profit warning last week after the firm revealed it expected results would fall short of forecasts.
Almost £600 million was wiped from the company’s stock market value and last week the company’s chief executive Richard Howson also stepped down with immediate effect so the firm could “undertaking a comprehensive review of the business”.
A county council spokesperson said: “At this stage, we have no reason to believe that Carillion’s current difficulties will impact upon the bypass.
“However, we are monitoring the situation closely and are in regular contact with them.
“In the very unlikely event that they are unable to continue with the project, we would have to appoint a new contractor.
“That process would take a few months, but we do allow for such unforeseen eventualities when planning major projects like this.”