Working to understand business financials can be scary, and many business owners avoid the topic for as long as possible. However, it’s an important component of running a successful business.  In addition, it will be necessary if you ever hope to get a loan or other form of financing.

In addition to classes we teach in our area, we have put this page together to help you understand business finance.  

Profit & Loss Statement

A Profit & Loss Statement (P&L), also known as an “Income Statement,” is a tool that aims to answer one main question: Is my business profitable?  Of course, in answering that question, you can learn lots of other things, like which of your revenue streams is generating the most income, which of your expense lines are greatest, etc.  In this sense, the P&L is an essential tool in helping you run your business.

Keeping track of your income and expenses via a Profit & Loss Statement is essential for getting a loan and is one of our requirements. Please view/download one of our P&L templates below (in Microsoft Word or Excel format) and read the notes within the file for further explanation.

Balance Sheet

A balance sheet, also known as a “Statement of Financial Position,” is a statement that gives a picture of the overall health of your business at a given moment in time. This is done by looking at what your business owns and owes, or your assets and liabilities. The difference between the two is the net worth of the business.

As a lender, we are interested in knowing what debts your business already has, as well as what assets (e.g. vehicles, equipment, etc.) your business owns.

Please view/download one of our Balance Sheet templates below (in Microsoft Word or Excel format) and check out the notes within for further explanation.

Pro Forma Financial Statement

A Pro Forma Financial Statement is a tool business owners and entrepreneurs use to project their financial future, especially as they start up or take on new ventures.

If you are in the early stages of development and are looking for a loan, we require a Pro Forma Financial Statement.  While this can take various forms, we are most interested in seeing your projections around net profit.  As such, our existing Profit & Loss Statement will suffice—just be sure to specify your start and end dates, which should be in the future.