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
When we started with GRA we werent certain of the benefits they could provide us. However they quickly unravelled our complex situations with multiple companies and structured our businesses so that we received maximum personal protection and minimised our tax liabilities. They have always been accurate on time thorough and available to answer our questions. Now six years after first moving to the team at GRA they have skilfully guided us to a future that looks amazing. It is with confidence we make decisions knowing our interests are protected by an outstanding group of modern forward thinking professionals. Their guidance has been invaluable and we can thoroughly recommend GRA - Dougall Love and Janice Knowles - June 2017
logo

Seminars and workshops for property investors, business owners and anyone seeking to create and protect their wealth.

View all our upcoming events
Learn More

GRA logo

Gilligan Rowe and Associates is a chartered accounting firm specialising in property, asset planning, legal structures, taxation and compliance.

We help new, small and medium property investors become long-term successful investors through our education programmes and property portfolio planning advice. With our deep knowledge and experience, we have assisted hundreds of clients build wealth through property investment.

Learn More
GRA Senior Partners
TOP