27 April 2009
A gym owner has its 2 branches in same city one is about 7 yrs old and another was established in Feb 09 only.
Owner wants loan on the new one ,Can he get that without taking referrence of old gym?
When owner approahed bank for loan,he got awared about submitting last three yrs B/S and projected B/S for upcoming 3 yrs.
My query is that can i make balance sheet on the same basis as that of his old gym or to show his projected income less than the older gym in projected B/S new gym.
27 April 2009
U need to consider the purpose for which the Projected Balance sheet and PL has been asked for by bank. Banker/Lender are basically interested in Projected Accounts just to ensure that ur earnings are good enough to meet the repayment schedule and upcoming financial commitments. Reference of Old gym will provide the basis i.e. the pattern of income the gym is generating to the owner and this will enable the banker to take informed decision. Basis of Projections can differ from old one provided ur Projected accounts meet their sets of predetermined standards of financing. eg Current ratio, Debt ratio, Interest Coverage ratio etc..Lots of factors has to be taken into account while drafting the Projections ...I hope the above informations are useful....
29 April 2009
The Basis of the projections will be on the no of tools/ excercising machines, type, make and value of machine. client base, the laocality and average income levels and age group etc.
CAclubindia
