Virtual Accountant | What Is The Company Overview Section
Many entrepreneurs understand that the executive summary is extremely important to their business plan says virtual accountant. But they need to understand that it is not the only important section that they need to pay attention to.
The company overview section is extremely important. Because it tells the bank as well as the underwriter who is involved in the company. So that they can be more likely to approve the loan.
The information that is included in the company overview section. Is vital to getting the loan approved. Because not only will it contain information about the business owner or owners. As well as the information about the business itself. But it will include things like who the lawyers are, the accountants, and if they have insurance or not.
However, if business owners do not put all of the most important information into their company overview. They could potentially make their approval process longer. Or even get denied the loan. Because the bank was missing information.
The first thing that a business owner needs to ensure they put into the company overview section according to virtual accountant. Is the business owner, and their contact information. If there is more than one shareholder in the corporation. They need to include all of the owners. Including their addresses, phone number, and email.
The business owner also needs to ensure that they are putting the information about the business itself into the company overview. Including the legal name as well as the operating name to avoid confusion. As well as information like the physical address of the business. The phone number, email address, and website if they have one.
If the business does not yet have a physical address. The business owner should put in the address that they used for incorporating. So that the underwriter will be able to look up all of the information and verify it.
Something that amount entrepreneur might overlook. Is putting the name and contact information of their accountant in the company overview. The reason why a business owner should include this information says virtual accountant. Is because an underwriter might view it as a risk mitigation factor.
If an entrepreneur has an accountant. Not only will their business plan be more likely to be realistic. But their cash flow projections will also tend to be more accurate, and simply by having an accountant. Will help an entrepreneur be more likely to succeed in business. Making them a lower risk for a bank to loan money to.
One of the most important things a business owner needs to keep in mind. Is that this section should be written with an external reader in mind. They should not make the assumption that any of this information should be clear elsewhere in the business plan. Therefore, the company overview section needs to be written very clearly. And without missing vital pieces of information.
When they hand their business plan into the bank in order to get approved for financing. This is the information they are going to use to ensure that the bank knows all of the people involved. So that they will be able to make a decision on whether to loan money to the business or not.
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One of the most common reasons why an entrepreneur will create a business plan says virtual accountant. In order to get approved for financing. Whether this is to purchase their business for the first time. Or if they are applying for financing to purchase assets or even a building. To help grow their business.
Regardless of the reason and entrepreneurs asking for financing. They need to ensure that they have a well thought out business plan. And that should include having a company overview section.
The company overview section will help tell the bank not only about who is involved in the business. But to ensure that they have important documentation and insurance in place. To make their decision on whether they should loan money to the business or not.
A bank will often require a business to have general liability insurance. Before they will even consider loaning money to the business. And if an entrepreneur already has the general liability insurance set up for their business. By putting it in their company overview section. Can help speed up the loan process.
The reason why it will speed up the process is that the bank will not have to go back to the business owner and ask if they have this important insurance. Because it will be clearly outlined in the overview.
It is even often a covenant of the bank to ensure that the business owners involved in the corporation have life and disability. Therefore, if an entrepreneur already has life and disability set up for themselves. Including in the company, an overview section can help speed up the loan application.
The reason why banks typically ask the business owners to have life and disability insurance. Is to guarantee that they are going to get their money back. If the principle of the business gets sick or dies. Banks often even ask the entrepreneur to agree to keep the life insurance for as long as they are making payments to the bank.
Another important piece of information that virtual accountant says business owners need to include in the company overview section. Is the Dane, contact information and address of their lawyer.
In order to complete the loan application. An entrepreneur will need to sign important legal paperwork. Including security on property and equipment. As well as signing personal guarantees. If a business owner already has a lawyer in place. The bank will know who to send the information to execute these documents as quickly as possible. And speed up the loan application process.
All of this information can help the bank become a more informed decision. And the more likely they have all of these things lined up in their business already. The more likely the bank will approve their loan quicker.
Therefore, while the executive summary is often one of the most important things that a business owner puts time into for their business plan. There company overview section should not and cannot be overlooked says virtual accountant. In order to maximize their chances of getting their loan approved.