Financing Entrepreneurial Ventures Part 1 Financial Plan & Statements

Size: px
Start display at page:

Download "Financing Entrepreneurial Ventures Part 1 Financial Plan & Statements"

Transcription

1 Financing Entrepreneurial Ventures Part 1 Financial Plan & Statements Barbara Peitsch Program Director, Univ. of Michigan Peter Scott Professor of Entrepreneurship/Consultant August 2015 Economic Empowerment of Women through Entrepreneurship

2 Discussion Overview Audience for financial plan What is the financial plan Estimating costs The plan Income Statement Cash Flow Balance Sheet

3 Audience Necessary sources of company information for wide variety of stakeholders Users include: Company management teams Investors Creditors

4 The Financial Plan (pro formas) The plan should include 1-5 years of Income Statements 1-5 years of Cash Flow Statements 1-5 years of Balance Sheets Statements should have reporting periods Monthly Year 1 Quarterly Year 2 / 3 Annually Year 4 & 5

5 The Financial Plan (pro formas) Financials are driven by business model and milestones Describes revenues, profits, cash flows Describes investments necessary to achieve goals Demonstrates overall economic potential of venture

6 The Financial Plan (pro formas) Used as decision making tool to help guide company Budgeting & goal setting Actual vs. forecast comparison Shows breakeven Required when seeking any form of funding Indicates investment return to investors Indicates exit potential

7 Financial Plan & Milestones Reasons for investment Operating Expenses Research & development Hire employees Marketing / sales Intellectual property Regulatory certification Capital Expenditures Finance purchase of property, plant and equipment Working Capital Finance inventory and receivables net of payables

8 Financial Plan & Milestones Investors Finance to milestones Reduces risk (technology, market, team, financing) Valuation changes at each new milestone Raise enough capital to exceed the milestone

9 Financial Plan & Milestones Milestones Build team Build prototype Complete product design Manufacture first unit Sign a development contract with a customer Sign partnership agreement Sign 1st customer / 1 st Dollar of revenue Breakeven

10 Common Mistakes Optimistic revenue projections Underestimating costs Lack of industry or competitor comparisons Ignoring bottom-up forecasting Optimistic time to financing projections Does not match Schedule

11 Estimating Costs More than just your salary You will need help People You will need space Rent You will need to tell people how good your product Sales & Marketing

12 Estimating Costs - example

13 The Income Statement The Income Statement shows a firm's revenues and expenses, and taxes associated with those expenses for a defined financial period. Remember that an Income Statement does not reveal hidden problems like insufficient cash flow.

14 Income Statement - analysis Analysts use the statement of earnings to examine a company's profitability trends in revenue operating income gross profit rates (or margins) return on assets return on equity or return on investment (ROI).

15 Income Statement - common mistakes Revenues Optimistic sales projections Method of forecasting revenue Seasonality in sales projections COGS: Do these fluctuate with sales? Salaries & Wages Do they account for Federal and State payroll taxes? Do they account for fringe benefits?

16 Income Statement - common mistakes Seasonality Marketing & Advertising: Do these fluctuate prior to increase in sales? Utilities: Do these fluctuate in seasons of heavy use? Start-up Costs Are these appropriately amortized? Are these appropriately depreciated?

17 Cash Flow Statement Cash - company's lifeblood Includes currency checks on hand and deposits in banks short-term, temporary investments, that can be quickly and easily converted to cash. Reports company's sources and uses of cash beginning and ending values of cash & equivalents for period change in cash and equivalents from all sources and uses of cash

18 Cash Flow Statement: Inflows Beginning Cash Balance Cash Inflows (Income): Accounts Receivable Collections Loan Proceeds Sales & Receipts Equity Proceeds =Total Cash Inflows

19 Cash Flow: Outflows Examples Advertising Bank Service Charges Credit Card Fees Delivery Health Insurance Insurance Interest Purchases Office Payroll Payroll Taxes Professional Fees Rent or Lease Subscriptions & Dues Supplies Taxes & Licenses Utilities & Telephone Inventory

20 Cash Outflows - continued Other Cash Out Flows: Capital Purchases Loan Principal Owner's Draw Other = Total Cash Outflows Ending Cash Balance

21 Cash Flow Statement common mistakes Ending Cash Is it always positive? regardless of the period (i.e. month, quarter, and year) Is ending cash enough to finance future growth and expansion for the business? Cash Flows from Investing Accounted for in the proper period?

22 The Balance Sheet The Balance Sheet a statement detailing What a company owns (assets) Claims against the company (liabilities) Owners' equity On a given date Snapshot illustrating company's financial health.

23 Balance Sheet common mistakes Assumption for Accounts Receivable 30, 60, or 90 day payment period? Does the plan account for delinquent payments? Assumption for Accounts Payable 30, 60, or 90 day payment period? Does the balance sheet balance?

24 Benchmark Ratios Helps investors determine how money is being used Net Profit Margin Gross Profit Margin Operating Expenses as % of Revenue Current Ratio Current Assets / Current Liabilities ROI - Net Income / Investment ROE Net Income / Shareholder Equity

25 Presenting the Financials Example Manufacturer of electric bikes in product development for 1 year beginning to sell 1 st product Raised seed capital Raising $1M Milestones achieved Patents applied for Team partly assembled (need VP Sales & Mkt) 1 st product developed

26 Presenting the Financials in 1000s Units Sold ,225 Revenue 140 1,903 11,350 CoGS 120 1,355 7,771 Gross Profit ,579 Gross Margin 29% 32% Operating Exp ,409 2,733 Operating Income (361) (861) 845 Cash end of year 449 1,966 1,699 Head Count Assumes $1M funding round in Q3 of 2011 and $3 million funding round Q

27 Presenting the Financials e-bikes seeks a total of $4-6 million in two rounds of preferred equity financings.

28 Remember Cash is king Conserve cash at every corner What assumptions effect cash consumption? How realistic are your forecasts? Don t say these are conservative You MUST do the financial statements before the talking to investors!

29 Thank you Barbara Peitsch Peter Scott

Financial Plan. A) Estimated One-Time Financial Requirements. Part One

Financial Plan. A) Estimated One-Time Financial Requirements. Part One Financial Plan The Financial Plan is perhaps one of the most important components of your Business Plan (see Business Plan Handout). Not only is it essential if you are seeking external financing it is

More information

Cash Flow Forecasting & Break-Even Analysis

Cash Flow Forecasting & Break-Even Analysis Cash Flow Forecasting & Break-Even Analysis 1. Cash Flow Cash Flow Projections What is cash flow? Cash flow is an estimate of the timing of when the cash associated with sales will be received and when

More information

BUSINESS PLAN TEMPLATE

BUSINESS PLAN TEMPLATE iplanner.net Small Business Plans Online BUSINESS PLAN TEMPLATE For a start-up company 18/01/2012 12:33:19(GMT) Executive Summary... 3 Business Overview... 3 Products and Services... 3 Sales Forecast...

More information

What is a business plan?

What is a business plan? What is a business plan? A business plan is the presentation of an idea for a new business. When a person (or group) is planning to open a business, there is a great deal of research that must be done

More information

FINANCIAL MANAGEMENT

FINANCIAL MANAGEMENT 100 Arbor Drive, Suite 108 Christiansburg, VA 24073 Voice: 540-381-9333 FAX: 540-381-8319 www.becpas.com Providing Professional Business Advisory & Consulting Services Douglas L. Johnston, II djohnston@becpas.com

More information

PLANNING FOR SUCCESS P a g e 0

PLANNING FOR SUCCESS P a g e 0 PLANNING FOR SUCCESS P a g e 0 PLANNING FOR SUCCESS P a g e 1 Planning for Success: Your Guide to Preparing a Business and Marketing Plan This guide is designed to help you put together a comprehensive,

More information

Financial Projections. Making sense of the money

Financial Projections. Making sense of the money Financial Projections Making sense of the money The Burning Questions What are your capital needs? Projections How will you get that capital? Structure: Equity or debt? Ownership structure Up-front or

More information

Plan and Track Your Finances

Plan and Track Your Finances Chapter 9 Plan and Track Your Finances 9.1 Finance Your Business 9.2 Pro Forma Financial Statements 9.3 Record Keeping for Businesses Ideas in Action Electronic Safekeeping Katelin Shea addressed the unmet

More information

How to Prepare a Cash Flow Forecast

How to Prepare a Cash Flow Forecast The Orangeville & Area Small Business Enterprise Centre (SBEC) 87 Broadway, Orangeville ON L9W 1K1 519-941-0440 Ext. 2286 or 2291 sbec@orangeville.ca www.orangevillebusiness.ca Supported by its Partners:

More information

Chapter 3. Learning Objectives Principles Used in This Chapter 1. An Overview of the Firm s Financial Statements

Chapter 3. Learning Objectives Principles Used in This Chapter 1. An Overview of the Firm s Financial Statements Chapter 3 Understanding Financial Statements, Taxes, and Cash Flows Agenda Learning Objectives Principles Used in This Chapter 1. An Overview of the Firm s Financial Statements 2. The Income Statement

More information

Solutions to Chapter 3. Accounting and Finance

Solutions to Chapter 3. Accounting and Finance Solutions to Chapter 3 Accounting and Finance 1. Sophie s Sofas Liabilities & Assets Shareholders Equity Cash $ 10,000 Accounts payable $ 17,000 Accounts receivable 22,000 Long-term debt 170,000 Inventory

More information

Developing Financial Statements

Developing Financial Statements New York StartUP! Business Plan Competition Developing Financial Statements Presented by Paisley Demby, CEO PBN Consulting, LLC www.pbnconsulting.com 1 Invitation to Tweet #2015NYStartUp PaisleyDemby Contents

More information

Financial. Management FOR A SMALL BUSINESS

Financial. Management FOR A SMALL BUSINESS Financial Management FOR A SMALL BUSINESS 1 Agenda Welcome, Pre-Test, Agenda, and Learning Objectives Benefits of Financial Management Budgeting Bookkeeping Financial Statements Business Financing Key

More information

Plan and Track Your Finances

Plan and Track Your Finances Plan and Track Your Finances 9.1 Financing Your Business 9.2 Pro Forma Financial Statements 9.3 Recordkeeping for Businesses Lesson 9.1 Financing Your Business Goals Estimate your startup costs and personal

More information

Module 2: Preparing for Capital Venture Financing Financial Forecasting Methods TABLE OF CONTENTS

Module 2: Preparing for Capital Venture Financing Financial Forecasting Methods TABLE OF CONTENTS Module 2: Preparing for Capital Venture Financing Financial Forecasting Methods Module 2: Preparing for Capital Venture Financing Financial Forecasting Methods 1.0 FINANCIAL FORECASTING METHODS 1.01 Introduction

More information

Breakeven Analysis. Breakeven for Services.

Breakeven Analysis. Breakeven for Services. Dollars and Sense Introduction Your dream is to operate a profitable business and make a good living. Before you open, however, you want some indication that your business will be profitable, if not immediately

More information

Carnegie Mellon University Center for Innovation & Entrepreneurship. Financial Modeling

Carnegie Mellon University Center for Innovation & Entrepreneurship. Financial Modeling Carnegie Mellon University Center for Innovation & Entrepreneurship Financial Modeling Phil Compton, CoFounder & CFO Malcovery Security www.malcovery.com October 7, 2015 My Background BS in Accounting

More information

GVEP Workshop Finance 101

GVEP Workshop Finance 101 GVEP Workshop Finance 101 Nairobi, January 2013 Agenda Introducing business finance Understanding financial statements Understanding cash flow LUNCH Reading and interpreting financial statements Evaluating

More information

Understanding Financial Statements. For Your Business

Understanding Financial Statements. For Your Business Understanding Financial Statements For Your Business Disclaimer The information provided is for informational purposes only, does not constitute legal advice or create an attorney-client relationship,

More information

Fundamental analysis

Fundamental analysis Fundamental analysis 2 June 2016 CERN Finance Club c.laner@cern.ch Introduction Let s cover the two main types of investment analysis used in traditional investing Today: Fundamental analysis Next time:

More information

Financial Planning. Presented by Emma's Garden

Financial Planning. Presented by Emma's Garden + Financial Planning Presented by Emma's Garden Financial Planning A comprehensive financial plan helps you to forecast and set your financial goals and milestones. Your financial forecasts are an essential

More information

Performance Review for Electricity Now

Performance Review for Electricity Now Performance Review for Electricity Now For the period ending 03/31/2008 Provided By Mark Dashkewytch 780-963-5783 Report prepared for: Electricity Now Industry: 23821 - Electrical Contractors Revenue:

More information

BACKGROUND KNOWLEDGE for Teachers and Students

BACKGROUND KNOWLEDGE for Teachers and Students Pathway: Business, Marketing, and Computer Education Lesson: BMM C6 4: Financial Statements and Reports Common Core State Standards for Mathematics: N.Q.2 Domain: Quantities Cluster: Reason quantitatively

More information

Insufficient Cash On Hand A Frequent Reason For Needing A Business Loan

Insufficient Cash On Hand A Frequent Reason For Needing A Business Loan Insufficient Cash On Hand A Frequent Reason For Needing A Business Loan 2 Cash flow is cash into or out of a business When cash inflows exceed cash outflows, it is generally indicative of good financial

More information

RENAISSANCE ENTREPRENEURSHIP CENTER First Finance Class (FIN-1)

RENAISSANCE ENTREPRENEURSHIP CENTER First Finance Class (FIN-1) Finance 1 (FIN-1) RENAISSANCE ENTREPRENEURSHIP CENTER (FIN-1) Learning Outcomes At the conclusion of this class, you should: Know what will be covered in the six finance class sessions. Have reviewed some

More information

Catching Up with Running Ratios

Catching Up with Running Ratios Catching Up with Running Ratios Laurie Watje, CPA University of Northern Iowa John Pappajohn Entrepreneurial Center Who is Laurie? Manager Student Business Incubator at UNI CPA Former business owner The

More information

Chapter Financial Forecasting

Chapter Financial Forecasting Chapter Financial Forecasting PPT 4-2 Chapter 4 - Outline What is Financial Forecasting? 3 Financial Statements for Forecasting Constructing Pro Forma Statements Basis for Sales Projections Steps in a

More information

Please NOTE This example report is for a manufacturing company; however, we can address a similar report for any industry sector.

Please NOTE This example report is for a manufacturing company; however, we can address a similar report for any industry sector. Please NOTE This example report is for a manufacturing company; however, we can address a similar report for any industry sector. Performance Review For the period ended 12/31/2013 Provided By Holbrook

More information

MASTER BUDGET - EXAMPLE

MASTER BUDGET - EXAMPLE MASTER BUDGET - EXAMPLE Sales IN UNITS for the previous two months (of last quarter), as well as the sales forecast for next quarter are as follows: Sales Budget Units May sales (ACTUAL) 20 June sales

More information

Chapter 1. Introduction to Accounting and Business

Chapter 1. Introduction to Accounting and Business 1 Chapter 1 Introduction to Accounting and Business Learning Objective 1 Describe the nature of a business, the role of accounting, and ethics in business. Nature of Business and Accounting A business

More information

MODULE 6 Financial Statements

MODULE 6 Financial Statements Introduction. 102 Projected Outcomes 103 Facilitators Notes. 104 What is Accounting. 104 The Accounting Equation.. 105 Accounting Terminology 106 Assets 106 Liabilities. 106 Owner s Equity, Partner s Equity,

More information

Business Start-Up Basics II

Business Start-Up Basics II Business Start-Up Basics II P R E B U S I N E S S P L A N P R E P A R A T I O N Presented by: SBDC Business Advisors Lisa Hutson Ana Badillo Susan Patton Agenda 1. Determine financing needs a. Discuss

More information

Financial Statements and Ratios: Notes

Financial Statements and Ratios: Notes Financial Statements and Ratios: Notes 1. Uses of the income statement for evaluation Investors use the income statement to help judge their return on investment and creditors (lenders) use it to help

More information

GUIDE TO ACQUIRING STARTUP FINANCING

GUIDE TO ACQUIRING STARTUP FINANCING GUIDE TO ACQUIRING STARTUP FINANCING 2015 American Institute of CPAs. All rights reserved. 15608-312 To make your business #CPAPOWERED, call today and let s get started. Contact information Address Phone

More information

GUIDE TO ACQUIRING STARTUP FINANCING. To make your business #CPAPOWERED, call today and let s get started.

GUIDE TO ACQUIRING STARTUP FINANCING. To make your business #CPAPOWERED, call today and let s get started. GUIDE TO ACQUIRING STARTUP FINANCING To make your business #CPAPOWERED, call today and let s get started. It s no secret that you will need capital money to launch your new business. In fact, many entrepreneurs

More information

FSA Note: Summary of Financial Ratio Calculations

FSA Note: Summary of Financial Ratio Calculations FSA Note: Summary of Financial Ratio Calculations This note contains a summary of the more common financial statement ratios. A few points should be noted: Calculations vary in practice; consistency and

More information

Module 2: Preparing for Capital Venture Financing Building Pro-Forma Financial Statements

Module 2: Preparing for Capital Venture Financing Building Pro-Forma Financial Statements Module 2: Preparing for Capital Venture Financing Building Pro-Forma Financial Statements Module 2: Preparing for Capital Venture Financing Building Pro-Forma Financial Statements TABLE OF CONTENTS 1.0

More information

Too often business owners do a cash flow in their head. Putting the information down on paper will give you the following:

Too often business owners do a cash flow in their head. Putting the information down on paper will give you the following: CASH FLOW A cash flow is a forecast of when you expect to receive cash from your sales and when you expect to pay your bills. It is not and should not be confused with a pro-forma income statement. A cash

More information

Guide to Financial Statements Study Guide

Guide to Financial Statements Study Guide Guide to Financial Statements Study Guide Overview (Topic 1) Three major financial statements: The Income Statement The Balance Sheet The Cash Flow Statement Objectives: Explain the underlying equation

More information

Business Plan. In completing the following proposal provide as much detailed information as possible.

Business Plan. In completing the following proposal provide as much detailed information as possible. Business Plan A business plan is an integral part of a financing request. It is an introduction to your business, and it provides us with the initial information that we require to start to an application.

More information

Financial. Management FOR A SMALL BUSINESS

Financial. Management FOR A SMALL BUSINESS Financial Management FOR A SMALL BUSINESS Welcome 1. Agenda 2. Ground Rules 3. Introductions FINANCIAL MANAGEMENT 2 Objectives Explain the concept of financial management and its importance to a small

More information

Understanding Financial Information for Bankruptcy Lawyers Understanding Financial Statements

Understanding Financial Information for Bankruptcy Lawyers Understanding Financial Statements Understanding Financial Information for Bankruptcy Lawyers Understanding Financial Statements In the United States, businesses generally present financial information in the form of financial statements

More information

Chapter 002 Financial Statements, Taxes and Cash Flow

Chapter 002 Financial Statements, Taxes and Cash Flow Multiple Choice Questions 1. The financial statement summarizing the value of a firm's equity on a particular date is the: a. income statement. B. balance sheet. c. statement of cash flows. d. cash flow

More information

how to finance the business

how to finance the business A DV I C E B O O K L E T how to finance the business HOW TO FINANCE THE BUSINESS Getting enough of the right funding is one of the more difficult tasks that you will face as a new entrepreneur. Typically,

More information

Successful Business Plan

Successful Business Plan Successful Business Plan Ahram Canadian University December 2011 Module No.-1 Objectives By the end o this session, you will be able to: Determine the importance of preparing a business plan Recognize

More information

FINANCIAL PROJECTIONS 101

FINANCIAL PROJECTIONS 101 FINANCIAL PROJECTIONS 101 PURCHASE AREA DEVELOPMENT DISTRICT (PADD) 1002 Medical Drive Mayfield, KY 42066 Creating financial projections for your business, particularly for a start-up, is both an art and

More information

Learning Objectives: Quick answer key: Question # Multiple Choice True/False. 14.1 Describe the important of accounting and financial information.

Learning Objectives: Quick answer key: Question # Multiple Choice True/False. 14.1 Describe the important of accounting and financial information. 0 Learning Objectives: 14.1 Describe the important of accounting and financial information. 14.2 Differentiate between managerial and financial accounting. 14.3 Identify the six steps of the accounting

More information

Financing a New Venture

Financing a New Venture Financing a New Venture A Canadian Innovation Centre How-To Guide 1 Financing a new venture New ventures require financing to fund growth Forms of financing include equity (personal, family & friends,

More information

Pro Forma Projections How to prepare reasonable projections based on your market and customers

Pro Forma Projections How to prepare reasonable projections based on your market and customers Pro Forma Projections How to prepare reasonable projections based on your market and customers Dennis Beard, Serra Ventures, LLC EnterpriseWorks EIR Workshop Series, February 16, 2011 Workshop Agenda 2

More information

6. Financial Planning. Break-even. Operating and Financial Leverage.

6. Financial Planning. Break-even. Operating and Financial Leverage. 6. Financial Planning. Break-even. Operating and Financial Leverage. Financial planning primarily involves anticipating the impact of operating, investment and financial decisions on the firm s future

More information

A Simple Model. Cash Flow Statement

A Simple Model. Cash Flow Statement An introduction to the cash flow statement in the context of building a financial model. This series introduces the financial statements in the context of a financial model. Cash Flow Statement NOTES TO

More information

Ashland Entrepreneur Center EXAMPLE Business Plan

Ashland Entrepreneur Center EXAMPLE Business Plan Ashland Entrepreneur Center EXAMPLE Business Plan Questions regarding this plan should be directed to: Larry Ferguson, E-Center Director (606) 326-2232 Or Kim Boggs, E-Center Coordinator (606) 326-2164

More information

Performance Review. Sample Company

Performance Review. Sample Company Performance Review Sample Company For the period ended 12/31/2017 Provided By Page 1 / 18 This report is designed to assist you in your business' development. Below you will find your overall ranking,

More information

SMALL BUSINESS OWNER S HANDBOOK

SMALL BUSINESS OWNER S HANDBOOK SMALL BUSINESS OWNER S HANDBOOK PART II: FINANCIAL PLANNING FOR SMALL BUSINESSES Introduction Financial Planning Methods of Financing Your Business Other Types of Funds & Financing How to Approach Lenders

More information

Entrepreneurship Chapter 10 1

Entrepreneurship Chapter 10 1 Operations Management Lesson 10.1 Operating Procedures Goals Define the functions of management. Describe types of policies that should be included in an operations manual. Vocabulary manager management

More information

A Simple Model. Introduction to Financial Statements

A Simple Model. Introduction to Financial Statements Introduction to Financial Statements NOTES TO ACCOMPANY VIDEOS These notes are intended to supplement the videos on ASimpleModel.com. They are not to be used as stand alone study aids, and are not written

More information

Indian Accounting Standard (Ind AS) 7 Statement of Cash Flows

Indian Accounting Standard (Ind AS) 7 Statement of Cash Flows Contents Indian Accounting Standard (Ind AS) 7 Statement of Cash Flows Paragraphs OBJECTIVE SCOPE 1 3 BENEFITS OF CASH FLOW INFORMATION 4 5 DEFINITIONS 6 9 Cash and cash equivalents 7 9 PRESENTATION OF

More information

Financial Statement Consolidation

Financial Statement Consolidation Financial Statement Consolidation We will consolidate the previously completed worksheets in this financial plan. In order to complete this section of the plan, you must have already completed all of the

More information

how to prepare a cash flow statement

how to prepare a cash flow statement business builder 4 how to prepare a cash flow statement zions business resource center zions business resource center 2 how to prepare a cash flow statement A cash flow statement is important to your business

More information

Components of a Business Model Core Strategy 1-5 Strategic 1-5 Partnership 1-5 Customer 1-5 Resources Network Interface

Components of a Business Model Core Strategy 1-5 Strategic 1-5 Partnership 1-5 Customer 1-5 Resources Network Interface ENGI 8607: Business Planning and Strategy in an Entrepreneurial Environment ZipCar Dr. Amy Hsiao Lecture 5 Memorial University of Newfoundland ZipCar Components of a Business Model How It Works http://www.zipcar.com/cambridge/findcars?zipfleet_id=94396

More information

Financial Statements

Financial Statements Financial Statements The financial information forms the basis of financial planning, analysis & decision making for an organization or an individual. Financial information is needed to predict, compare

More information

BUSINESS BUILDER 7 HOW TO ANALYZE PROFITABILITY

BUSINESS BUILDER 7 HOW TO ANALYZE PROFITABILITY BUSINESS BUILDER 7 HOW TO ANALYZE PROFITABILITY zions business resource center 2 how to analyze profitability Although pride of ownership and career satisfaction are healthy goals, generating profit is

More information

APPENDIX 1 The Statement of Financial Position

APPENDIX 1 The Statement of Financial Position APPENDIX 1 The Statement of Financial Position 1. Assets: the resources of the organization which are used to provide service and generate value 2. Current assets: assets which can be converted to cash

More information

Return on Equity has three ratio components. The three ratios that make up Return on Equity are:

Return on Equity has three ratio components. The three ratios that make up Return on Equity are: Evaluating Financial Performance Chapter 1 Return on Equity Why Use Ratios? It has been said that you must measure what you expect to manage and accomplish. Without measurement, you have no reference to

More information

The Nature of Accounting Systems

The Nature of Accounting Systems Basic Accounting & Budgeting February 4, 2009 The Nature of Accounting Systems Accounting is the process of recording, classifying, summarizing, reporting and interpreting information about the economic

More information

Business Plan Planning Service Financial Analyses and Projections

Business Plan Planning Service Financial Analyses and Projections Business Plan Planning Service Financial Analyses and Projections Financials Included With Every Ceo Resource Plan These are the financial analyses and projections that are included with all plans developed

More information

Model is used to calculate Financial Statements on a Quarterly Basis for a One Year period. Model provides the ability to:

Model is used to calculate Financial Statements on a Quarterly Basis for a One Year period. Model provides the ability to: ADDITIONAL REFERENCES AND FINANCIAL MODELS: For more information about financial statements and terms refer to e book, How to Read Financial Statements. Advanced financial models providing 5 year projections

More information

Export Business Plan Guide

Export Business Plan Guide Export Business Plan Guide Table of Contents Introduction... 4 SECTION 01: CURRENT SITUATION ANALYSIS... 5 Company Overview... 5 Availability of Resources... 6 SWOT Analysis... 9 SECTION 02: MARKET ANALYSIS...

More information

Ipx!up!hfu!uif Dsfeju!zpv!Eftfswf

Ipx!up!hfu!uif Dsfeju!zpv!Eftfswf Ipx!up!hfu!uif Dsfeju!zpv!Eftfswf Credit is the lifeblood of South Louisiana business, especially for the smaller firm. It helps the small business owner get started, obtain equipment, build inventory,

More information

Financial Statement Preparation Webinar. Presented by Nick Chapman VEI Program Coordinator New York City

Financial Statement Preparation Webinar. Presented by Nick Chapman VEI Program Coordinator New York City Financial Statement Preparation Webinar Presented by Nick Chapman VEI Program Coordinator New York City 122 Amsterdam Ave. New York, NY 10023 Phone: 212-769-2710 www.veinternational.org Objectives: Review

More information

A PRACTICAL GUIDE TO WRITING A BUSINESS PLAN

A PRACTICAL GUIDE TO WRITING A BUSINESS PLAN A PRACTICAL GUIDE TO WRITING A BUSINESS PLAN Louisiana Small Business Development Center At Southeastern Louisiana University 1514 Martens Drive Hammond, LA 70401 Phone: (985) 549-3831 Fax: (985) 549-2127

More information

NEPAL ACCOUNTING STANDARDS ON CASH FLOW STATEMENTS

NEPAL ACCOUNTING STANDARDS ON CASH FLOW STATEMENTS NAS 03 NEPAL ACCOUNTING STANDARDS ON CASH FLOW STATEMENTS CONTENTS Paragraphs OBJECTIVE SCOPE 1-3 BENEFITS OF CASH FLOWS INFORMATION 4-5 DEFINITIONS 6-9 Cash and cash equivalents 7-9 PRESENTATION OF A

More information

FINANCIAL INTRODUCTION

FINANCIAL INTRODUCTION FINANCIAL INTRODUCTION In earlier sections you calculated your cost of goods sold, overhead expenses and capital cost in order to help you determine the sales price of your product. In your business plan,

More information

REC 3033 Commercial Recreation and Tourism. Class Week 12. The Dollars and Sense of Your Business. Preparation of Proforma Statements

REC 3033 Commercial Recreation and Tourism. Class Week 12. The Dollars and Sense of Your Business. Preparation of Proforma Statements REC 3033 Commercial Recreation and Tourism Class Week 12 The Dollars and Sense of Your Business Tourism operators not making large sums of money Tourism Canada Study (1995) average adventure travel operator

More information

Chapter 9 E-Commerce: Digital Markets, Digital Goods

Chapter 9 E-Commerce: Digital Markets, Digital Goods 1 Chapter 9 E-Commerce: Digital Markets, Digital Goods LEARNING TRACK #: 2: BUILD BUSINESS PLAN There are lots of different ways to lay out a business plan. The sample

More information

Operating Working Capital Drills

Operating Working Capital Drills Operating Working Capital Drills Operating Working Capital Drills 1. Use IBM s balance sheet below to calculate 2010 and 2011 working capital and operating working capital. Your VP has told you to consider

More information

Business Plan for XXX

Business Plan for XXX Business Plan for XXX Version: 1.0 Date: [Elements in italics are indications to explain the business plan concepts: they should be deleted and not appear in the completed version of the business plan.

More information

Summary of Consolidated Financial Results for the Year Ended March 31, 2016 (Based on Japanese GAAP)

Summary of Consolidated Financial Results for the Year Ended March 31, 2016 (Based on Japanese GAAP) Translation Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes. In the event of any discrepancy between this translated document and the

More information

Business Plan Guide. NYS Small Business Development Center. Small Business Development Center. Farmingdale State College

Business Plan Guide. NYS Small Business Development Center. Small Business Development Center. Farmingdale State College NYS Small Business Development Center Farmingdale State College Business Plan Guide Small Business Development Center The SBDC is a program supported by the U.S. Small business administration and extended

More information

Summary of Financial Report for the FY ending March 2015 (Non-Consolidated)

Summary of Financial Report for the FY ending March 2015 (Non-Consolidated) Summary of Financial Report for the FY ending March 2015 (Non-Consolidated) April 30, 2015 Listed Company Name: Japan Tissue Engineering Co., Ltd. Listed Securities Exchange: JQ Stock Code: 7774 URL http://www.jpte.co.jp

More information

Basic Business Plan Outline

Basic Business Plan Outline Basic Business Plan Outline A business plan needs to be a well thought out, honest, appraisal of the business and opportunity. This outline is meant to be used for your road map. It should be a living

More information

Sri Lanka Accounting Standard-LKAS 7. Statement of Cash Flows

Sri Lanka Accounting Standard-LKAS 7. Statement of Cash Flows Sri Lanka Accounting Standard-LKAS 7 Statement of Cash Flows CONTENTS SRI LANKA ACCOUNTING STANDARD-LKAS 7 STATEMENT OF CASH FLOWS paragraphs OBJECTIVE SCOPE 1 3 BENEFITS OF CASH FLOW INFORMATION 4 5 DEFINITIONS

More information

Assessing Viability and Feasibility of Business Ideas. Dr. Neeraj Pandey Assistant Professor LM Thapar School of Management

Assessing Viability and Feasibility of Business Ideas. Dr. Neeraj Pandey Assistant Professor LM Thapar School of Management Assessing Viability and Feasibility of Business Ideas Dr. Neeraj Pandey Assistant Professor LM Thapar School of Management WHY NEW VENTURES FAIL Lack of Objective Evaluation No Real Insight into the Market

More information

How to Analyze Profitability

How to Analyze Profitability How to Analyze Profitability Peoples Bank Business Resource Center Business Builder 7 peoplesbancorp.com 800.374.6123 Table of Contents What to Expect... 4 What You Should Know Before Getting Started...

More information

Steak House 1.0 EXECUTIVE SUMMARY 2.0 COMPANY AND FINANCING SUMMARY 4.0 STRATEGIC AND MARKET ANALYSIS. 4.2 Industry Analysis 5.

Steak House 1.0 EXECUTIVE SUMMARY 2.0 COMPANY AND FINANCING SUMMARY 4.0 STRATEGIC AND MARKET ANALYSIS. 4.2 Industry Analysis 5. Business Plans Handbooks "Steak House." Business Plans Handbook. Ed. Lynn M. Pearce. Vol. 20. Detroit: Gale, 2011. 133-147. Business Plans Handbooks. Web. 31 May 2012. Document URL http://go.galegroup.com/ps/i.do?id=gale%7ccx1999800022&v=2.1&u=chipl&it=r&p=gvrl.plans1&sw

More information

CASH FLOW STATEMENT. On the statement, cash flows are segregated based on source:

CASH FLOW STATEMENT. On the statement, cash flows are segregated based on source: CASH FLOW STATEMENT On the statement, cash flows are segregated based on source: Operating activities: involve the cash effects of transactions that enter into the determination of net income. Investing

More information

CASH FLOW STATEMENT (AND FINANCIAL STATEMENT)

CASH FLOW STATEMENT (AND FINANCIAL STATEMENT) CASH FLOW STATEMENT (AND FINANCIAL STATEMENT) - At the most fundamental level, firms do two different things: (i) They generate cash (ii) They spend it. Cash is generated by selling a product, an asset

More information

===============================

=============================== Business Plan Pages: 09 Work Al. Izzi / 131 Ellison Street / Paterson / 973-754-8695 / Correo Electronico izzaji@aol.com =============================== Cover Sheet Business Plan Begin the Plan with a

More information

UNITED STATES BANKRUPTCY COURT NORTHERN & EASTERN DISTRICTS OF TEXAS REGION 6 MONTHLY OPERATING REPORT

UNITED STATES BANKRUPTCY COURT NORTHERN & EASTERN DISTRICTS OF TEXAS REGION 6 MONTHLY OPERATING REPORT ACCRUAL BASIS JUDGE: UNITED STATES BANKRUPTCY COURT NORTHERN & EASTERN DISTRICTS OF TEXAS REGION 6 MONTHLY OPERATING REPORT MONTH ENDING: MONTH YEAR IN ACCORDANCE WITH TITLE 28, SECTION 1746, OF THE UNITED

More information

tutor2u Cash Management How and Why Businesses Need to Manage their Cash AS & A2 Business Studies PowerPoint Presentations 2005

tutor2u Cash Management How and Why Businesses Need to Manage their Cash AS & A2 Business Studies PowerPoint Presentations 2005 Cash Management How and Why Businesses Need to Manage their Cash AS & A2 Business Studies PowerPoint Presentations 2005 Importance of Cash (1) A business can exist for a while without making profits but

More information

9. Short-Term Liquidity Analysis. Operating Cash Conversion Cycle

9. Short-Term Liquidity Analysis. Operating Cash Conversion Cycle 9. Short-Term Liquidity Analysis. Operating Cash Conversion Cycle 9.1 Current Assets and 9.1.1 Cash A firm should maintain as little cash as possible, because cash is a nonproductive asset. It earns no

More information

Preparing a Successful Financial Plan

Preparing a Successful Financial Plan Topic 9 Preparing a Successful Financial Plan LEARNING OUTCOMES By the end of this topic, you should be able to: 1. Describe the overview of accounting methods; 2. Prepare the three major financial statements

More information

Financial Ratios and Quality Indicators

Financial Ratios and Quality Indicators Financial Ratios and Quality Indicators From U.S. Small Business Administration Online Women's Business Center If you monitor the ratios on a regular basis you'll gain insight into how effectively you

More information

ENTREPRENEURIAL FINANCE: Strategy Valuation and Deal Structure

ENTREPRENEURIAL FINANCE: Strategy Valuation and Deal Structure ENTREPRENEURIAL FINANCE: Strategy Valuation and Deal Structure Chapter 7. Methods of Financial Forecasting: Integrated Financial Modeling Questions and Problems 1. The cash cycle is the time between when

More information

Financial Modeling & Forecasting. Jason MacMorran www.pncpa.com

Financial Modeling & Forecasting. Jason MacMorran www.pncpa.com Financial Modeling & Forecasting Jason MacMorran www.pncpa.com Presentation Outline I. Introduction and Learning Objectives II. Definitions and Standards Overview III. Uses for Financial Models IV. Basics

More information

Introduction to Accounting

Introduction to Accounting Introduction to Accounting Text File Slide 1 Introduction to Accounting Welcome to SBA s online training course, Introduction to Accounting. This program is a product of the agency s Small Business Training

More information

Developing Business Plans and Funding Proposals

Developing Business Plans and Funding Proposals The best source of information and training on Aboriginal finance and management The Aboriginal Finance and Management Capacity Development Series Developing Business Plans and Funding Proposals A Practical

More information

Accounts Payable are the total amounts your business owes its suppliers for goods and services purchased.

Accounts Payable are the total amounts your business owes its suppliers for goods and services purchased. Accounts Payable are the total amounts your business owes its suppliers for goods and services purchased. Accounts Receivable are the total amounts customers owe your business for goods or services sold

More information

UNDERSTANDING WHERE YOU STAND. A Simple Guide to Your Company s Financial Statements

UNDERSTANDING WHERE YOU STAND. A Simple Guide to Your Company s Financial Statements UNDERSTANDING WHERE YOU STAND A Simple Guide to Your Company s Financial Statements Contents INTRODUCTION One statement cannot diagnose your company s financial health. Put several statements together

More information