CMA Report Preparation at TaxShooter
CMA Report Preparation
Entrepreneurs today are turning to banks to raise money at a lower cost rather than investing their own money in order to manage their working capital needs. Additionally, banks are eager to lend money to companies with excellent financial standing and payback capabilities. When we go to the bank, they ask for the project report and the CMA data of the company so that they can assess the financial stability of the company. CMA Data is based on the company's audited, provisional, and projected financial statements. While preparing CMA Data for any enterprise, there are numerous considerations that must be made, including precise financial statistics, comparative projected figures, and ratio analysis. We will talk about "How to Prepare CMA Data for Bank Loan" in this article.
Financial statements from the previous five years must typically be provided to CMA Data. Using realistic data, two years of projections are audited, one year is provisional, and two years are projected. Ratio analysis is extremely important in the process of creating CMA Data. Care must be taken in the preparation of the CMA Data. The acceptance of a loan application primarily depends on these financial metrics. Additionally, the way that CMA data is presented varies slightly depending on whether the unit is a manufacturing or trade one.
Therefore, for Manufacturing units, we require a few extra inputs. Manufacturing accounts, trading accounts, and profit/loss statements that show comparative data over a five-year period must be prepared in order to display the profit/loss statement. In this statement, we must include information about Sales, Cost of Sales (which includes information about Raw Material Consumed, Direct and Indirect Manufacturing Expenses, Cost of Production, Interest Expenses Incurred, Bifurcation of Operating and Non-operating Expenses, and Calculations of Taxes to Pay).