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Completing Your Business Plan 
 

You will need to complete your business plan[1] in order to get your funding request approved from at least one bank or funding source.  You will need the following financial documents as part of your business plan to get funding:

Personal FinancialsThis is a document reflecting your financial health. Personal financials are used to cacluate the net worth of an individual by measuring assets against liabilities.  to obtain financing for a new business, you'll need to include a personal financial statement or balance sheet.

Two Year Proforma Income Statement- This income statement is a simple and straightforward report on the business' cash-generating ability. It is a scorecard on the financial performance of your business that reflects when sales are made and when expenses are incurred. It draws information from the cost and revenue inputs developed earlier, such as revenue, expenses, capital (in the form of depreciation) and cost of goods. By combining these elements, the income statement illustrates just how much your company makes or loses during the year by subtracting the cost of goods and expenses from revenue to arrive at a net result, which is either a profit or loss. 

One Year Proforma Cash Flow Projection- The cash flow projection is one of the most critical information tools for your business.  It shows how much cash you'll need to meet obligations, when you'll require it and where it will come from. The result is the profit or loss at the end of each month and year. The cash flow projection carries both profits and losses over to the next month to also show the cumulative amount. Running a loss on your cash flow projection is a major red flag that indicates not having enough cash to meet expenses, which demands immediate attention and action.  The cash flow projection should be prepared on a monthly basis.

Normally, an institution will approve a loan via a “letter of commitment”. With your funding secured, you can close on the land and move forward on the project.



[1] Descriptions of Personal Financial Statement, Income Statement and Cash Flow were taken from www.entrepreneur.com, an excellent source for answers to many startup questions.

 Financial Tools

The following tools will act as templates and assist you in preparing and completing the financial portion of your business plan.

Cash Flow Projection

 Funding Sources and Use

 Loan Payment Calculator

 Personal Finance Template

 Income Statement Projection

 
 
 
 
 
 
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