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Make sure it’s easy for them to cross reference and get that information. You want to make it as easy as possible for this person that you are never going to meet, uh, to get the information they needed. Terman your worthiness for this long. Yeah, I can see why I can be you ever cause it’s not. Hi. Thanks for joining us for another episode of ask [inaudible] CPA today as the of business coach, we’re talking about the business plan company overview section. I Have Laura here with me today. Laura, how you doing? Great. Great. Yeah. How’s the schooling coming? Pretty good for you. Good. Where are you now? What’s, how many, how many courses you got left? Do you know? Not Too many left. Yeah. Finishing up the fourth year. Yeah, fourth year. So you got the countdown going number of courses. Okay. Yep. Um, so the court that we have here today, it’s a Robert Kiyosaki quote, you know, author of Rich Dad, poor dad wrote it with his accountant, by the way, Karen lector. Uh, but he says that good debt is a powerful tool, but bad debt can kill you. And Industry Canada tells us that 51% of small businesses seek external financing. And the story that we have here in terms of the, the, the company overview section is business owners need Edmonton Business Coach.

They’re assembling a plan for the purposes of getting financing, however, they’re not including some of the basic information that the lender will need before approving any loans. This causes the loans to get rejected or delayed a sip of it just because there’s missing information. So Laura, what are the questions that these business owners should be asking? Okay. Is it the banker you deal with or the loan underwriter that approves them? So the problem is everyone [inaudible] they think it’s the banker. They’re dealing with the banker all the time, but they don’t realize, is your banker the one that you’re dealing with? That commercial lender is going to send it to an underwriter. And a lot of times, especially out west here, the, the underwriter is not even in the same side of the country as I. So it gets pushed out to an underwriter and their job is to determine the risk of that loan with a Edmonton Business Coach.

If it conforms to the bank standards, and then they’re going to communicate that back to the banker that you’re actually dealing with. So the, the loan underwriter, not your banker is the one who ultimately approves that loan. Do you get to deal with the loan underwriter? They do not. They have a stone wall between you and that loan underwriter. You think that you’re dealing with the person, you think that you’re dealing with the banker. But that banker is essentially the messenger in the whole equation. I mean, they have some, they have a, a knowledge in order to varying amounts of knowledge depending on the level of experience. But ultimately they’re relaying that information and you know, presenting that case in an organized fashion to the underwriter and you don’t get to deal with that underwriter. And that’s by design because you shouldn’t be able to influence the underwriter one way or the other. Can the company overview section be used to get info to everyone efficiently? Yeah. So when we’re talking about a business plan, that company overview section, it can be used to get all of the information that you need. Uh, you know, that critical basic company information. You can get it to everybody, get it, gets it to the banker, gets it to the underwriter, you know, this is gonna prevent those, you know, rejections or delays on, I’m just missing critical basic information.

Do you need to distinguish between legal names and trade names? Yeah. So one of the things you should have in that company overview section is you want to distinguish between, you know, uh, it’s ABC Corporation Limited, or oftentimes it’s a number corporation, one, two, three, four, five, six, seven, Alberta Limited operating as you know, Smith and Jones industries. Uh, so you want to be very specific and very precise about what the legal names are and what the trade names are because they’re going to do searches on everything. And if they’re doing searches and it’s not coming up with consistent information, you know, that’s a chance for a rejection or delay. Well, the lender need to know the ownership percentage for all corporations involved. Yeah, they will. So they’ll want to know the ownership percentage. So who are the shareholders? And if it’s a multi corporation structure, they are gonna wanna know the ownership percentages for every corporation in that structure. And you can better believe that they’re going to cross reference that against corporate registry. They’re going to do what Edmonton Business Coach say then search and see who has the voting shares. Now of course the voting shares will appear on corporate registries. The non voting shares won’t. So sometimes they’ll have to be some explanation surrounding that. Um, but yeah, but they’re not going to lend money without knowing who owns these corporations.

Well, the lender need to know the date of incorporation in your end. Yeah. They’re going to want to know when, when did this thing start? What’s the date of incorporation and what’s the year end? Because that year end is probably going to have a reporting standard that that comes with it. Either you don’t know what are three to financial statements or maybe even reviewed financial statements, uh, that they’re gonna want. But yeah, 100%. There’s going to be a, a, a request to know what the incorporation date and is, what the year end date is and that could you just put it right in the, in the business plan, the company overview section? Well the lender need to know the address, phone, email and web address. Yeah. Here’s like basic, basic things and people think that doesn’t matter and they’re life and death and these financing, they get the financing, the business works, they don’t get the financing, their dreams are crushed and they think, well everyone knows my address, my phone number, my email. Um, maybe so hopefully the bankers passing it through the underwriter, but why take the chance, put it into the company overview section and put the web address. Because oftentimes the bakers have to do searches based on the individual that they’re the business that they’re potentially lending to see if there’s anything nefarious or anything bad going on that they wouldn’t want to lend to this person. So make it easy for them to do this or should they need to do check their boxes and lend you the money? Be sure to GIve us a call now at 780-665-4949 or just check out as soon as you can!

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Well, the lender wants to know the WHO, the accountant for the corporation. It does, it speaks to the credibility of the business that, you know, over requesting money. Is this a business that’s gone through the trouble and hire [inaudible] accountant, but an actual chartered professional accountant, a CPA, uh, to do their financial reporting? Or is this a, you know, yeah. You don’t kind of the seat of their pants type of business that has never assembled annual financial statements as loan underwriters busy, um, you normally don’t want to, you know, they, they, it doesn’t reflect favorably on them. If they approve you for a loan and you end up defaulting on that loan, that’s their job. So you make them take you seriously. You recognize that you do have professionals on your team. Uh, well the lender need to know who the lawyer for the corporation is. Yeah. So I mean also just to establish the legitimacy that is no, to show that you actually do have a corporate lawyer who looks after your affairs. Uh, it can be helpful, but sometimes when it comes to the lawyers, they actually need a lawyer to act on your behalf to actually, you know, get the loan documents executed. A lot of times they have to be, uh, executed through a lawyers office. So why delay the process? Let’s get the lawyer, you know, a front and ready on, on the uh, company or resection or the business plan to prevent those delays or prevent rejections on basic missing information. Please try a Edmonton Business Coach to help your company grow!

Well, the lenders sometimes need to know who the banking representative you have. Believe it or not, these banks are big, huge organizations and sometimes the left hand doesn’t know what the right hand’s doing and you don’t want to make sure that, that, you know, when you might have I banker who you deal with and you might have a, uh, the, so you have one that deals with your basic transactions, your accounts, and you have another banker that you’re going through the loan application process with. And sometimes the underwriter is going to want to call on the person who’s assigned to your, into your banking file. Make sure it’s easy for them to cross reference and get that information. You want to make it as easy as possible for this person that you are never going to meet, uh, to get the information they needed. Terman your worthiness for this long as a Edmonton Business Coach.

Well the lender need to know who the general insurance agent is. a lot of times the one of the conditions for the financing of the loan will be that the business has the property general liability insurance in place will the bank doesn’t want to lend you this money one day and you get sued the next day and the now you default on this loan. So they, you don’t want to know that you have the correct insurance in place. Um, you’ll send them the details for your, for your insurance agent, put it right on the business. Well the lender need to know who the life and disability insurance agent is. Yeah, this is another one of the critical ones. Often Times one of the covenants. So we talk about covenants of alone and these are the list of requirements where the bank says, hey, we’re going to give you this money, we’re going to lend you this money, but you have to have these things in place. You know, general liability will often be one of them. Uh, but often it’s also life and or disability insurance for the business owner. Sometimes like a key person in the organization. So they want to make sure that if the business owner, you know, get sick and all of a sudden that they can’t work anymore, that that um, you know, cashflow stream is secured. So that business owner has a mechanism, they have disability insurance payments coming in that they can actually meet their loan obligations and saying things, you know, life insurance, what if this person gets hit by a bus tomorrow?

You know, the bank doesn’t want to make sure that the, they want to ensure that their loan, you know, they’re a hundred thousand or 500,000 or a million or 10 million isn’t defaulted on simply because someone isn’t paying the, the 50 bucks a month that they need for the, the term life policy that would get everyone covered off. And so they will look a lot of times that they had that disability insurance in place. And a lot of times in regards to life insurance, they’ll want to ensure that the corporation is the beneficiary or sometimes they’ll get the net assignment on the insurance directly to the bank, uh, in the event that something happens. So sometimes it’s not just having the insurance in place overall, but it’s actually having the right specifications of the insurance. You know, who is the beneficiary, who is the insurance policy assigned to and along with the amounts as well with a lender like to know who the benefit provider with a Edmonton Business Coach.

Yeah, I mean the benefit Predator, it’s good to put it in the plan because it, you know, often it relates to the employees and making sure the employees have a, you know, uh, an incentive. That’s the purpose of benefit plans is to give them, you know, benefits in a tax efficient manner, paying for things like medical expenses and dental visits in it in a tax efficient manner. Um, but often the owners, um, disability and or life insurance is intertwined with that benefit programs. So sometimes they’re not separable. You know, sometimes business owners will have a separate insurance for their life and disability and a separate benefit provider. But a lot of times it’s one in the same and the business owner is able to get a good rate because they go to that benefit provider. So if we’re dealing with a lender and you know, assembly, a company overview section that, you know, we’re going to make it as efficient as possible to extract the information they need to see if you qualify for this loan, you’ll put that benefit provider in there. Those would all be, you know, recommendations of what I would like to have in, in the company overview section of the business plan. So I think that’s what we have here today. Again, thanks so much for tuning in. It’s always, please hit that like and subscribe button so we can continue to deliver you tips on how to beat the odds of business. And as always, you have any comments, you’ll be loved to read them below so we can respond back and use your input for future videos. Thanks very much and give us a call now at 780-665-4949 or go to as you are able to!