Can I Sign Oregon Banking Word

Can i industry sign banking oregon word fast

[Applause] Jinja the CPA here one of the banks gonna look at when they are looking at your financial statements they really should be looking at the same things you should be looking at but the number one priority for the bank is to ensure that you are going to be able to pay them back so in my opinion they're looking at some key indicators to know what cash flow they don't care typically how much money you have in the bank compared to how much they care about how much money more will you be putting into the bank so what they look at is what are your assets the biggest asset that the bank is going to look at typically is your accounts receivable what that means is here's work that you've done but you haven't collected on it what does that mean to the bank cash to come in here's what they don't like on your accounts receivable old-aged accounts receivable meaning typically most banks if your AR includes amounts that are older than 90 days they won't even consider that in essence an asset what they look at is what have you done in the last 90 days and what are you gonna collect on that that should be money that should be pretty securely to come in the door they're gonna look at your accounts payable as well that means here's money that you haven't spent yet but you've received the goods or the services so that lets them know what who else are you having to pay besides them so if you have a high accounts payable that's telling the bank you've got a lot of money yet to spend and what are these relationships to your bank balance so on the financial statements you're looking at your bank balance which is different than what you would see if you logged in to your bank because what's on your financial statements should include any outstanding items meaning if you wrote a check today and you logged into your bank today your balance will be more accurate on your financial statements because it's gonna reflect the check that you just wrote mean the amount in your bank is going to be less because it just hasn't cleared the bank account does that matter to a bank because that gives them a true indicator of course the bank can look and see how much money you have sitting there with them but they would like to know well how much money are you gonna have though when the checks clear it could also be the same with deposits and collections there could be a type of or an opportunity or a time when you've collected money but haven't put it in the bank so the bank would then be better aware of what your true balance is but then the AR the relationship to your bank of balance is if you have a hundred thousand in the bank and you have accounts receivable of fifty thousand the bank looks at that is that at some point if all the business stopped right now they should end up with a hundred and fifty thousand but you have to subtract from that the payable so if everything were to stop right now you had a hundred thousand in your bank according to your financial statements you have fifty thousand in accounts receivable and you had ten thousand dollars in accounts payable they would do a simple math problem a hundred thousand plus the fifty minus the ten allows the bank to know you really have a hundred and forty thousand to work with and it doesn't just stop there what they're gonna look at then is that what do you owe them and if everything were to stop right then and you owe them a hundred thousand dollars the bank's gonna feel pretty secure in this because in essence there would be a hundred and forty thousand to work with to pay off the hundred we know that 8020 rule applies in a lot of other things the IRS I'm sorry the bank's when they're looking at the strength of it they're definitely going to want to see about a twenty percent margin of error in their opinion and what I mean by air is if you have a hundred forty thousand to play with and you owe a hundred thousand there's definitely room for error there meaning if the payables were higher than what was expected or the receivables were lower than what was expected they're gonna feel comfortable enough that there's enough that could be used to pay them back because you got to remember the banks are there to lend you money for one reason so that they can collect interest and get paid back all right hey here's the thing I'd love it if you'd subscribe please do if you made it to here great valuable information subscribe to my youtube channel check me out on every social media medium hashtag jayjay - CPA and then don't you ever forget you've never met a CPA quite like me here's the bottom line you need to subscribe to my videos right I've given you valuable information here I appreciate you tuning in but here's what I need you to do a favor click subscribe check out my other videos and then don't you ever forgive you've never met a CPA quite like me