Checklist for a presentation to bankers

KPMG is often requested either to assist clients in preparing a proposal for bank finance or to advise clients on the information likely to be required. This checklist serves as an aide-memoire of the information which a bank is likely to require from the applicant and will provide a logical basis for structuring a presentation.

1.  Bank Finance Required
   • The reason why funds are required;
   • How much and what sort of finance is required.

2.  History and Background to Business

   • When the business was established;
   • How the business has evolved;
   • Main factors contributing to development.

3.  Share Capital and Articles

   • Principal shareholders and their relationship;
   • Any unusual restrictions in the articles (e.g. On borrowing powers or transfer of shares).

4.  Key Personnel

   • Structure and organisation;
   • Age, qualifications, experience, skills of directors, senior management and other key employees;
   • Arrangements for management succession (e.g. in the case of absence, sickness, departure or retirement of key personnel).

5.  Business

   • Nature and description of products (if new or technology based a separate technical appraisal may be needed);
   • Description of market and estimated demand both short and long term;
   • Market research data (eg. From trade associations, market research publications);
   • Competitors, their likely strengths, weaknesses and future strategies;
   • Competitive advantages for products of business (eg. Innovative design, quality, pricing, uniqueness).

6.  Management Information and Accounting Systems

   • Description of internal accounting systems and nature and regularity of management reporting routines;
   • Outline of systems of budgetary control

7.  Accounting Policies

   • Confirmation that acceptable accounting policies are used on a consistent basis.

8.  Trading results

   • Summarized financial information for last 3 years (covering profit and loss, cash flow statement);
   • Summarized balance sheet at latest balance sheet date.

9.  Taxation

   • Current status of negotiations with Receiver of Revenue on agreement of tax liabilities;
   • Any unusual features or matters in dispute.

10.  Current Trading

    • Up to date profit figures from management accounts;
    • Up to date liquidity figures (ie. Debtors, creditors, stock and bank).

11.  Contingencies and Litigation

    • Any significant contingent liabilities or outstanding litigation;
    • Details of insurance cover (including any keyman insurance).

12.  Profit Projections

    • Projections of future sales and profitability;
    • Current order position;
    • Major commercial assumptions and sensitivity of projections to variances from plan.

13.  New Projects

    • Description of any new projects or products;
    • Impact of new project on profit projections;
    • Contingencies (eg. To cover setbacks such as supply problems).

14.  Cash Forecast

    • Forecasts of likely cash flows (ensuring that all relevant items are included, for example, leave pay, corporate taxation, bank interest, dividends, etc);
    • Major commercial assumptions and sensitivities.

15.  Borrowings

    • Details of existing borrowings (showing lender, terms and amount);
    • Further borrowings required to finance new project;
    • Required repayment terms and effect on cash flows;
    • Contingency provisions (ie. Consider the worst possible position)

16.  Security

    • What assets of the business are available for security;
    • Financial standing of directors and availability of personal security (eg. Life assurance, property).

17.  Monitoring

    • Proposed monitoring arrangements and nature and regularity of financial information to be presented to lender;
    • Whether periodic financial information is to be prepared and vetted by independent accountants (e.g. The auditors)

Source - SEDA Website