GRA Blogs

Articles by John Rowe

John Rowe

Business Borrowing

2983

Often business owners need to approach the bank for money, for example to put into their business. This is a perfectly normal part of running a business. However, there is something that many business owners are unaware of, which could jeopardise their relationship with the bank and therefore their chances of borrowing any more money in the future. 

When you apply for a loan for a business, the bank may ask for a link to your Xero account (or MYBO, Banklink etc.). This is so they can check your position and make sure you meet their criteria for lending money. The problem is that unless the ledger is completely up to date and has all the entries that an accountant would do at the end of the month, then it is likely that the information you provide the bank with will be inaccurate – and in some cases, majorly inaccurate!

If you give inaccurate information, you may face a potential issue of trust between you and the bank. Relationships with banks are good if you deal honestly and provide accurate information. If you provide inaccurate information, it gives the bank a picture of how you run your business and can reduce (or eliminate) your chances of raising money in the future.

Be very wary of emailing links to MYOB, Xero etc. to banks unless your ledger is complete accurate and up to date (i.e. no end of year financial statements outstanding). Prior to giving anything to a bank, it is advisable to check with your accountant first. If you don’t, it may backfire on you in the long run. If you would like assistance getting your ledgers up to date before applying for a bank loan, contact us at GRA - we would be happy to help you. 

John Rowe
signed
John Rowe
Director
Business Accounting Services
© Gilligan Rowe & Associates LP

Did you like this article? Subscribe to our newsletter to receive tips, updates and useful information to help you protect your assets and grow your net worth. We're expert accountants providing expert advice to clients in NZ and around the world.

Disclaimer: This article is intended to provide only a summary of the issues associated with the topics covered. It does not purport to be comprehensive nor to provide specific advice. No person should act in reliance on any statement contained within this article without first obtaining specific professional advice. If you require any further information or advice on any matter covered within this article, please contact the author.
Comments

Add a Comment

Log in or sign up to post a comment

Testimonials
The seminar last night was the best I have attended. Your speech was inspiring, professional and interesting. I have followed GRA for a very long time and really love your books Property 101 and Tax Structures 101. I didn't find them in the library of Victoria University and managed to ask the uni to purchase some copies so that students won't miss out these amazing books. - Kardy - December 2017

Would you like to receive . .

. . tips, updates and useful information to help
protect your assets and grow your net worth?

Property 101by

Investing in residential property?

Put this at the top of your reading list.



If you're investing in residential property, seeking to maximise your ability to succeed and minimise risk, then this is a 'must read'.

Matthew Gilligan provides a fresh look at residential property investment from an experienced investor’s viewpoint. Written in easy to understand language and including many case studies, Matthew explains the ins and outs of successful property investment.

  • How to find the right property
  • How to negotiate successfully
  • Renovation do's & don'ts
  •  Property management 
  • Case studies and examples
  • and much, much more...
TOP