Project reports and CMA data for bank loans
A sanction turns on whether a credit officer can follow your numbers without rebuilding them. This is what we prepare, what we need from you, and what usually causes a query letter.
What the credit officer is actually checking
A proposal is not read front to back. It is read for the eight things the committee note has to answer, and a report that buries them invites a query.
- 01
Can the promoter run this
Background, relevant experience, net worth and credit history, stated plainly rather than padded. A thin promoter section is the fastest route to a query.
- 02
Is the cost real
Every line of project cost supported by a quotation, a valuation or a contract. Round figures with no backing get challenged first.
- 03
Is the margin actually there
Promoter contribution traced to a source, not asserted. Where it comes from unsecured loans, the subordination position has to be clear.
- 04
Do the projections follow from the capacity
Revenue that implies utilisation above the installed capacity, or a ramp with no basis, is the single most common reason a model is sent back.
- 05
Does the DSCR hold in the worst case
Not just the base case. The average and the minimum across the tenure, and what happens when the sensitivity is applied.
- 06
Is the working capital assessment defensible
Holding periods that reconcile to the operating cycle described in the narrative, and an MPBF computed by the method the bank prescribes.
- 07
Are the ratios consistent with the statements
Current ratio, TOL to TNW, interest coverage and the rest, computed from the same statements printed in the report rather than from a separate sheet.
- 08
Can the numbers be traced
Every figure in the narrative sitting in a cell in the model. If the officer has to rebuild it, the file goes to the bottom of the pile.
What we need from you to start
Almost every delay in a project report is a document delay, not a drafting delay. This is the list we send on day one, and the more of it that arrives together, the faster the first draft.
Promoter and entity
- PAN and Aadhaar of promoters, partners or directors
- Constitution documents: partnership deed, LLP agreement, memorandum and articles
- Net worth statement of each promoter and any guarantor
- Credit report of each promoter, and an explanation of anything adverse on it
- Proof of the promoter's experience in the line of business
The project
- Quotations for plant, machinery and equipment, with the supplier named
- Civil cost estimate or the contractor's schedule of rates
- Land and building documents: title, lease deed or rent agreement
- Layout, capacity and the process flow, however roughly drawn
- Licences and approvals obtained or applied for
Financials
- Audited financial statements for the last three years, where the business exists
- Provisional or estimated figures for the current year
- Income tax returns and computations for the same years
- GST returns for the last twelve months
- Bank statements for all accounts for the last twelve months
- Existing loan sanction letters and repayment schedules
The ask
- Which bank and which branch, before anything is drafted
- Term loan and working capital amounts sought, separately
- Any scheme being applied under, such as MUDRA, CGTMSE or a state subsidy
- Security offered, and whose it is
How the engagement runs
Five stages. The clock on all of them starts when the documents arrive, not when the engagement is agreed.
- 01
Scoping and bank format
Which bank, which branch, which scheme, and therefore which format. SBI, Bank of Maharashtra, SIDBI and the MUDRA categories each prescribe their own, and the wrong format is a resubmission.
- 02
Data and reconciliation
Documents collected against the list, financials reconciled to the returns and the bank statements, gaps raised with you in one consolidated list rather than in a trickle of messages.
- 03
The model
The twenty one sheet workbook is built first, not the narrative. Cost, means of finance, working capital, projections, repayment, DSCR, ratios and sensitivity, all live formulas.
- 04
The narrative
The report is written from the model. Charts render at 300 DPI and are titled with the finding. If an assumption changes at this stage, the report changes with it rather than being patched.
- 05
Review, sign off and submission support
Five gate review, partner sign off with UDIN, then the banker ready set. If the branch raises a query, we answer it against the model rather than rewriting the report.
Why reports come back
These are the recurring causes of a query letter. None of them is about presentation.
- Projections that imply utilisation above the capacity stated elsewhere in the same report
- Promoter contribution shown without a traceable source
- Working capital holding periods that contradict the operating cycle described in the narrative
- Hard-coded figures in the model, so a changed assumption does not flow through
- Cost lines without a supporting quotation
- A DSCR that holds in the base case and fails the moment a sensitivity is applied
- The bank's own CMA format not followed, so the branch cannot lift the figures into its note
- Ratios computed on a different set of numbers than the statements printed in the report
About this engagement
Tell us the bank, the branch and the amount sought, and we will tell you what the format demands before you commit to anything.
- Do you prepare the report only, or do you deal with the bank as well?
- Both, with your written consent. Most branches raise queries on the model rather than the narrative, and those are faster to answer directly. What we do not do is negotiate terms on your behalf or represent that a sanction will follow.
- Can you work with a report a previous consultant prepared?
- Usually, though it often takes longer than starting again. If the underlying model is hard-coded, there is nothing to work with, and rebuilding it is faster than auditing someone else's arithmetic line by line.
- Is the model handed over to us?
- Yes. You receive the workbook with live formulas, not a locked or flattened copy. It is the same file we used to write the report, so you can run your own scenarios on it afterwards.
- What is not included?
- We do not commission valuations, technical certifications or legal title searches. Where the bank requires them we will tell you at the scoping stage so they run in parallel rather than holding up the submission.