Accounting News and Notes

Atlanta CPA on Addressing Financing Needs for Atlanta Business Owners & Entrepreneurs for Decades

Helping Clients in a Down Economic Market…Procuring $100,000 line of credit for Atlanta Based Business

Despite the news of the times and the severity of the downturn in the economic market, there remains financially sound quality lenders who are seeking to extend credit to qualified business owners. As you would expect, however, banks are getting back to the basics of lending practices that ruled the decades of lending practices before the recent downturn in the economy. Rather than the “free wheeling” lending business practices of the past, banks and other traditional lenders are seeking to lend monies to well-run companies who have an idea to expand both the revenue and profit of the business.

Lenders are now more than ever looking to the Five C’s of lending:

-Credit

-Cash Flow

-Character

-Collateral

-Conditions

If you have a sound business model, a good business plan, good payment history, adequate collateral and the respect of your peers, lending sources are available and credit to extend credit to your business. However, as has been true for decades often having the attention and relationship with a good smaller bank is the best bet for entrepreneurs and business owners who have definitive financing needs. Smaller banks and lenders are often much more flexible and willing to extend credit when larger regional and national banks will not. Working with your CPA who has these contacts and is aware of economic conditions and trends in your area is essential to procuring and especially funding credit needs in tough economic times.

We have recently helped a business owner here in Atlanta area obtain and procure a $100,000 needed credit line for their business. The credit line could not have come at a better time as the economy was shrinking and it allowed the company sufficient cash flow to cash flow their business needs and allowed them sufficient time for them to package their business and to sell the business outright. It is probable that without the credit line in place that the business would have folded before the owner could “cash in” by the selling of their business to a competitor for hundreds of thousands of dollars.

John Dillard is a Christian Speaker/Author and Certified Public Accountant (All Rights Reserved). To See how he takes Christ along with him to work visit http://www.hiscpa.com/ (An Atlanta CPA firm) and for his latest book Overcoming Life’s 9/11’s: Job’s Journey and to learn about his ministry visit http://www.john-dillard.com/ To contact John Dillard CPA (Atlanta Christian Author/Speaker) today call 770. 814.9304 proudly serving Duluth, GA, Gwinnett County and Beyond.

“Dare to Attempt Something so Great for the Kingdom of God that it is doomed to failure, lest Christ be in it!” What, then, shall we say in response to this? If God is for us, who can be against us? Romans 8:31 Why are these verses here? Learn how His CPA became a Christian Accounting firm visit http://www.hiscpa.com/christian-CPA.html

Asset Based Lending: Finding Alternative Sources of Funding Your Atlanta Business

Atlanta CPA on What to Do When the Bank Says No

Asset based lending is perhaps one of the least know of all the funding opportunities a business owner or entrepreneur has at their disposal when traditional banking options fail. Banks traditionally have and continue to focus more on the track record of a business given its past results, history and profits. However an asset based lender is much more apt to loan monies to businesses based upon their present. For example if you a new business and still marginally profitable, a traditional lending institution is more apt not to make a loan to a business, especially in light of current business and economic conditions. However a asset based lender might be much more inclined to make a loan to you using your current assets, such as Accounts Receivable rather than your Profit & Loss statement to make an underwriting decision.

For example a business that is growing quickly, has good financial sound clients, a good track record for internal control and integrity should consider Asset Based Lending when the bank declines to extend a offer or credit. An asset based lender, will spend much of their underwriting time evaluating your billing procedures, the integrity of your clients and their industry and the age of your receivables. An Asset Based Lender is likely to only extend a credit line when you have fiscally sound procedures in place and that your Accounts Receivable stay current. To protect themselves an Asset Based Lender will usually request that that all of your billings are paid to a lockbox under their control. The advantages of using an Asset Based Lender include the procurement of capital where it otherwise might not be available, flexible lending levels based upon the growth and size of your Lending base.

Traditional banking sources should always be explored first, as almost always, this will be a less costly alternative. Asset based lending is traditionally exponentially more expensive that standard sources but would still remain substantially cheaper than bringing in a Venture Capitalist (VC), who will own a percentage of your profits forever. Most Asset Based Lenders work hand in hand with banks and are more than willing to transfer the account to a traditional lending source as soon as the business’s profits, net worth, and track record make the business more “bankable.”

John Dillard is a Christian Speaker/Author and Certified Public Accountant (All Rights Reserved). To See how he takes Christ along with him to work visit http://www.hiscpa.com/ (An Atlanta  CPA firm) and for his latest book Overcoming Life’s 9/11’s: Job’s Journey and to learn about his ministry visit http://www.john-dillard.com/ To contact John Dillard CPA (Atlanta Christian Author/Speaker) today call 770. 814.9304 proudly serving Duluth, GA, Gwinnett County and Beyond.

“Dare to Attempt Something so Great for the Kingdom of God that it is doomed to failure, lest Christ be in it!”

What, then, shall we say in response to this? If God is for us, who can be against us? Romans 8:31

Why are these verses here? Learn how HIS CPA became a Christian Accounting firm visit http://www.hiscpa.com/christian-CPA.html  

We advise clients on: IRS representation, Offer in Compromise, Tax Problems, Incorporation in Georgia, Corporate and Personal Income Tax Returns, Part-time CFO, Virtual Controller, Business Planning, Offer in Compromise, Back Taxes, Business Acquisitions/Sales,  Forensic Accounting, Business Valuations and Bookkeeping.