To get a bank loan, a working capital loan, or a CC limit, you need to prepare and present CMA data. The CMA report in Excel format is one way to present it more attractively and efficiently. As we said it is really essential to create CMA reports for bank loans. We, the Finline team, have prepared this article to provide answers to all of these queries. Any inquiries are welcome from your side.
CMA report also is known as the Credit Monitoring Arrangement report. It is a report showing the projected performance and the past performance of a business in financial terms for obtaining a bank loan. Also, It is compiled with all the required financial ratios and metrics to help bankers obtain the financial health of a business. Therefore, most of the Banking and Financial Institutions request the entrepreneur to submit the CMA report to understand the flow and application of funds in the business.
Most banks require loan applicants to prepare reports. These reports help the banks determine if the capital can be used for growth and eventual repayment. However, a better CMA report will improve the chance of getting a loan. Finline helps you create the report professionally and easily. A banker/analyst can easily interpret the data and ratios in the report and thus reach into a conclusion on the health of the business unit.
Preparing a CMA report is a tiresome job and needs extra professionalism and care, so a normal entrepreneur feels it very difficult to prepare. With Finline, it’s very easy. You don’t need to worry about difficult calculations, ratios, or adjustments because our intelligent software takes care of it all. Finline is the best tool for CMA data reports to obtain bank loans.
The CMA report includes the following statements:
Operating Statement
This indicates the borrower’s business plan showing the Current Sales, profit before & after tax, sales projections, direct & indirect expenses, and profit position for 3 to 5 years.
Analysis of Balancesheet
This statement contains an analysis of the current & projected financial years. Also, it helps in providing a comprehensive analysis of current & non-current assets, current & non-current liabilities and cash & bank position of the borrower. This statement also specifies the net worth position of the borrower for the future projected years.
Comparative statement of current asset and current liability
This analysis helps to decide the capacity of the borrower to meet the working capital requirements and the actual working capital cycle for the projected period.
Calculation of ABF/MPBF
This includes a calculation that indicates the Asset Based Finance and Maximum Permissible Bank Finance. It shows the borrower’s capacity to borrow money.
Cashflow statement
The main objective of this statement is to capture the movement of the fund for the given period.
Ratios
This indicates the financial strength of the unit at different parameters
Why is CMA data necessary?
CMA provides a financial roadmap of a company’s success through time. CMA data may assess the general financial situation, loan eligibility, repayment ability, etc. A well-planned and written CMA Data is enough to demonstrate loan eligibility.
While a CMA Report conducts a highly thorough examination of a company’s profit and loss account and balance sheet, only a select few ratios and indices determine loan eligibility.
Crafting an effective CMA Report has two key components. First, convey that money is required for development. Second, outline a sound financial estimate. The firm needs to find the right balance between being strong enough to repay the loan and not so healthy that it can grow without needing one, as shown by the CMA Data.
Experts at Finline skillfully create CMA Data and Project Reports for various businesses and industries. We are confident that we possess the necessary expertise to provide our clients with accurate CMA Data and Project Reports. Furthermore, a well-written CMA Data set with precise and understandable financial performance metrics forms the foundation for a loan request. Increase your chances of securing a loan by using our simple help tool.