Financial projections
This query is : Resolved
17 November 2014
I am preparing Financial projections for one of our client which is proposing manufacturing of "X" Product.
1. I have query that while compiling Financial Projections, can we show the negative profitability in first 3 years,but Cash Profit (PAT + Depreciation) is positive.
2. Can We show negative working Capital?
1. I have query that while compiling Financial Projections, can we show the negative profitability in first 3 years,but Cash Profit (PAT + Depreciation) is positive.
2. Can We show negative working Capital?
17 November 2014
SHOWING?????? What do you mean by that? If it is estimated that first 3 years will be LOSS making years, then there is NO harm in disclosing the same to the BANKERS. Never PLAY with the figures....Be true and fair.
17 November 2014
For financial(cash flow) projections add back depreciation.
For working capital show short term borrowings to make it positive.
For working capital show short term borrowings to make it positive.
17 November 2014
The meaning of can we show is that, if the profitability is negative whether it effects our borrowing power.that is what i meant.
17 November 2014
It need not affect the borrowing power as such so long as it is well within the debt equity ratio.
17 November 2014
Does Negetive working capital effects the borrowing bower?
17 November 2014
No. Negative working capital suggests that your company is CASH RICH.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Showing Gift from relative in ITR for this year
- ITR selection for salaries and capital gain less than L
- Share accounting-->fifo - capital gain - period as per fifo?
- ITR filing- non tax audit cases- Asstt.Year 2026-2027
- Soyabean hsn code and gst rate
- Treatment of Pension ?annuity returns on PMVY
- Regarding IMS Mandatory from 1st July 2026
- Form 10E u/s 89(1). Need clarification because experts opinions differ !!!!
- What is provisional receipt number for generation of form 16A
- Salary and pension received from Asian Development Bank
- Gst invoice numbering and delivery challan numbering
- Standard Deduction claim for EPFO Pension and ICICI Prudential Life Annuity
- Small dealers gst returns filing
- Sales amount in Gstr1
- CG after sale of flat
- E Commerce GSTR1 & 3B how to file
- GST Cancellation without jurisdiction
- Legal Opinion on Registrar's Refusal to Investigate a Society for Non-Renewal and Non-Compliance
- GST Refund_RFD-01
- Form10BD was uploaded successfully without any Error but after 24 hours, Form10BE are not available
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
