Resources for Developing a Financial Plan

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Globe for WikiEducator.jpg Unit 6.1-Resources for Developing a Financial Plan 

Introduction | A Financial Plan | Presentation and Customization | Risk Assessment and Management | How Do I Qualify? | Summary | Resources | Activities | Assessment

Unit 6.1- Resources for Developing a Financial Plan

All forms of financing require financial data to be submitted and evaluated by the financier.

Financial planning demonstrates the ability based on historical data to forecast and project anticipated results. A financial plan is generally a key element of a more comprehensive business plan which covers all aspects of a company. Projections are made to see if the company can meet its objectives. The ability to understand and use the financial information contained in the plan gives outside sources, such as banks and investors, confidence. Without this understanding and confidence, an outside source will be reluctant to provide funding.

The balance sheet and income statement reveal the key financial data for a business. The two statements combined tell a story. A reader may find some aspects of these statements mysterious or confusing, and they will elicit questions that must be answered. The company’s ability to field and answer these questions to the satisfaction of that reader will determine the success of getting the financing required. The fewer the questions the better the chances are of getting funding from a bank or investor. Answering all questions does not, however, supersede the minimum requirements to become bankable: being in business for two years, having a positive net worth, and being a profitable company. These are not the only requirements; but without these at a minimum, a lender will ask for other assets or collateral. The balance sheet lists:

  • Assets consisting of:
  • cash
  • inventory
  • accounts receivable
  • Liabilities from:
  • accounts payable
  • short-term
  • long-term debt
  • Equity reflecting the owners’ investment
  • all accumulated earnings

The business plan and financial statements are prepared for internal use but are often presented to external entities to demonstrate the strength and expertise of a company. Presentation of a business plan is critical to gaining investor confidence.

Many factors may result in a company needing to borrow money. The ability to project these needs based on growth through a cash flow analysis or demonstrated through the planning process will convince outsiders to invest in the company. The profitability of the company should demonstrate the ability to provide a return on investment and/or pay back any debt incurred.

Icon objectives.jpg
The goal of this material is to introduce you to the resources available to aid companies in developing their financial plans for internal and external international trade financing.

By the end of this unit you will be able to

  • describe the key components of a financial plan
  • identify the key financial ratios
  • identify key financial resources--the Ex-Im Bank, SBA, private banks, non-bank private sector lenders required to develop a financial plan
  • identify advantages and disadvantages of each resource
  • describe how to find these resources

Unit Outline


File:Unit 6.1 Outline Presentation Slides.odp
File:Calculating Cost.odt

Correlation: Materials from this unit correlate with NASBITE CGCP's Knowledge Statement 04/06/01: Knowledge of resources (e.g., Ex-Im Bank, SBA, private banks, non-bank private sector lendors)