BSBSMB406A Manage Small Business Finance Sources of Finance Implement and Monitor Financial Performance 1.6 Select key performance indicators to enable ongoing monitoring of financial performance Chap 3 page 80 Third Edition 2016 Chapter 7 Page 159

Main sources of Finance Suppliers Credit Trade Contractors Credit Client Deposit BSBSMB406A Manage Small Busines Finance - Wk 13 - PC 1.6 - Monitor Financial Performance

No interest paid to banks Profit distribution Equity Finance Proprietors own funds Private investors Benefits :- No interest paid to banks Profit distribution BSBSMB406A Manage Small Busines Finance - Wk 13 - PC 1.6 - Monitor Financial Performance

Debt Finance Bank Loan Is a debt until repaid Includes Interest The Interest rate may be dependant on :- your loan record Current financial situation BSBSMB406A Manage Small Busines Finance - Wk 13 - PC 1.6 - Monitor Financial Performance

It is a common form of Finance. Business Overdraft It is a common form of Finance. Interest charged only on the balance borrowed All Interest is Tax deductable Since it is a Taxable Profit REDUCER BSBSMB406A Manage Small Busines Finance - Wk 13 - PC 1.6 - Monitor Financial Performance

Need money to purchase next development property Bridging Loan Short term loan Need money to purchase next development property Before sale finalised on current development. BSBSMB406A Manage Small Busines Finance - Wk 13 - PC 1.6 - Monitor Financial Performance

Variable or Fixed interest Short or Long term Term Loan Short term Tailored to your needs Variable or Fixed interest Short or Long term Security in land or buildings generally required BSBSMB406A Manage Small Busines Finance - Wk 13 - PC 1.6 - Monitor Financial Performance

Equipment Finance – Equipment Leasing May be provided by the Vendor / Manufacturer ( Ford Finance ) Discount on purchase price if this finance selected Interest is Tax deductable BSBSMB406A Manage Small Busines Finance - Wk 13 - PC 1.6 - Monitor Financial Performance

Lender required information Purpose of Loan and Amount Security available for the Loan Existing Debt, Loans Previous Debts, Loans BSBSMB406A Manage Small Busines Finance - Wk 13 - PC 1.6 - Monitor Financial Performance

Lender required information Business Plan Last 2 years Financials 12 months cash flow budgets Taxation Returns and assessments Current Financials showing Debtors & Creditors BSBSMB406A Manage Small Busines Finance - Wk 13 - PC 1.6 - Monitor Financial Performance

Performance Indicators Project Forecast Profit Company Forecast Profit Site Overheads Company Overheads BSBSMB406A Manage Small Busines Finance - Wk 13 - PC 1.6 - Monitor Financial Performance

Project Forecast Profit The Project budget is affected by the Construction Budget Site Management’s task is to stay within the Construction Budget If they exceed the Construction Budget the Project Profit will be Eroded Every Sub Contract and purchase MUST be within Budget BSBSMB406A Manage Small Busines Finance - Wk 13 - PC 1.6 - Monitor Financial Performance

Company Forecast Profit BSBSMB406A Manage Small Busines Finance - Wk 13 - PC 1.6 - Monitor Financial Performance