A 5 Part Series on Business Plans: Part 4- The Financial Plan

by David Huff on July 31, 2012

Note: This portion of the business plan should not be completed until the organizational and marketing plans have been completed.

The financial plan is the analysis of measurable figures for a business plan.  The organzational and marketing plans are put together and from this we calculate the projected financing Ã‚ costs.

The following two pieces of information need to be included only if you are seeking financing:  a financial needs summary and a loan fund dispersal statement.  The summary needs to include the reasons you are applying for financing and the amount of capital needed.  The dispersal statement will state how you plan to use the funds and supporting data needs to accompany this statement.

The next pertinent piece of inofrmation for all financial plans is the budget.  This shows all cash flow- both intake and outflow. It needs to show how much money comes in to your business and when it flows out. ( This is of extreme importance to a lender or investor because it also states how you intend to repay your loan. ) This income statement should use the first year’s figures and project cash flow for the next two years. This projection is made using current and expected economic and industry trends.  It should include projections of assets, liabilities and the net worth of the company at the end of the next fiscal year.

If your business has not yet begun operations, the financial section will end here.  If your business is estalished, you will continue with a profit and loss statement which will show all financial activity over a statd period of time( monthly, yearly, etc).  A balance sheet will show the condition of the business as of a fixed date.  A financial statement analysis will need to be included to show comparisons of items in a single year, financial statements for a perior of time , or a comparison of your business and other similar businesses in the area.  A financial history, a summary of your business from start to present, is to be included at this point.

Join us for Part 5 of our series on business plans.  We will discuss necessary Supporting Documents.

Contact Person Huff CPA Group for help with your financial plan.


David W Huff, CPA, PFS, MS is a partner at Person Huff CPA Group. He provides clients with tax preparation and consulting services, accounting services, retirement plan and benefit consulting, accounting software technical support and training, and management advisory services. His specialty is helping new businesses organize their operations to maximize tax savings and move quickly from start-up to profitability.  You can reach David by email




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