Press Release
Soren McAdam Christenson LLP
Certified Public Accountants and Business Advisors
Contact: Roger Wadell, Partner
909.798.2222
PR Contact: Ron Burgess
909.798.5737
FOR IMMEDIATE RELEASE
August 28, 2006
The Care and Feeding of Your Banker
Beyond Accounting—
Financial statements are far more useful than for simply determining if you have made a profit for the month. One important use for them is as a borrowing tool. Bankers need to know the health of a company so they can determine if the loan can be paid back; they need to know what assets will protect the loan, if the company cannot pay.
However, all financial statements are not created equally.
It is the banker’s job to decipher every statement; to carefully understand the underlying meaning of every number. This is not always an easy task. Since the numbers represent totals of other accounts, it is important for the banker to be confident in the accuracy of all the components represented in a financial statement.
A financial statement can be generated directly from an accounting program by the company, or it can be compiled by professionals. If the banker knows the reputation of the accounting firm, he or she can make judgments about how the numbers were gathered and the accounts were balanced, as well as the method in which other issues were handled (such as the treatment of depreciation). A company opting to generate its own statement usually alerts a careful banker to the need for additional discernment.
Areas of the statement (within the balance sheet) that feed the concerns of a banker include issues that can be hidden to management and lending institutions. Examples might include liabilities for employee benefits, unfulfilled contracts, or long-term obligations that are not in the form of formal notes. Rules (GAAP, Generally Accepted Accounting Principles) govern how these kinds of issues are treated. Financial institutions and fiduciaries will normally be aware of these rules and how they can affect a company’s financial statement.
Soren McAdam Christenson LLP knows from experience that the financial statement format desired by the banking industry adds credibility and increases the information necessary for timely execution of a transaction. SMC assists clients in a variety of ways, to insure adequate funding, cash flow, break-even and pay-back analysis - all issues that your banker will want to know.
Industry specific expertise is also important, such as a special understanding of bonding requirements for the construction sector. Soren McAdam Christenson is well-known by bonding companies to have this skill set. Clients can save money when the financials are properly formatted for the specific purpose of communicating with bonding companies.
Soren McAdam Christenson has become the leading CPA firm in the Inland Empire, partly because of the business advisory services offered to every client. These services include working with client attorneys, bonding companies, insurance agencies and yes, the care and feeding of bankers.
Soren McAdam Christenson LLP is the right size with the right expertise to insure a personal relationship with clients, while providing the highest value accounting and advisory services available.
For more information on SMC, contact Roger Wadell, partner, at 909.798.2222 or visit www.smc-cpas.com.
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