The bank asked for financial statements. We prepare them.
When a lender asks for financial statements before a loan or a line of credit, they mean statements prepared by a CPA firm, not your tax return. ARC CPA prepares them for contractors across Nova Scotia, New Brunswick and PEI.
You want to grow. The bank wants statements.
A new truck, equipment, a line of credit to carry a bigger job. You go to the bank and the first thing they ask for is financial statements. You have a tax return, and maybe a spreadsheet. Neither is what they asked for.
It is the second most common reason a contractor calls us, and it usually comes with a deadline.
What the bank is actually asking for
Almost always, a compilation engagement: financial statements prepared by a CPA firm from your books. You may know it by its old name, a notice to reader. There are four levels of financial statements, and a compilation is the one lenders usually want from a business your size.
The statements are written for two readers: you, and your lender. They tell the story of the business in plain language. A bank will not read your corporate tax return, and only a CPA firm can prepare these.
Why it is harder than it sounds
Statements are only as good as the books
If the books are behind or in a spreadsheet, they have to be brought current and corrected first. That is usually most of the work.
The bank has a timeline
A loan for equipment or a line for the season does not wait. The sooner we see the books, the sooner we can tell you when the statements will be ready.
Next year they will ask again
Lenders usually want updated statements every year. With books done monthly, next year’s set is quick.
From the bank’s request to statements in hand
- 01
Tell us what the bank asked for
Which statements, for which year end, and when they need them.
- 02
We look at your books
If they are current, we start straight away. If not, we catch them up first and tell you how long that takes.
- 03
We prepare the statements
Prepared by our CPA team from your books, with the year-end adjustments that only an accountant makes.
- 04
You take them to the bank
And if the lender has questions about them, you have someone to ask.
- 05
Every year after
With your books done monthly, the next set is ready when the lender asks.
“Since bringing our business accounting needs to ARC and team, we have seen nothing but professionalism at its finest. We couldn’t be any more pleased with the team.”
Your questions, answered.
What is a compilation engagement?
Financial statements prepared by a CPA firm from the information you provide. It is the level lenders most often ask small and mid-sized businesses for.
Is that the same as a notice to reader?
Yes. Notice to reader was the old name. The standard was updated and renamed, but many lenders and owners still use the old term.
Can I give the bank my tax return instead?
Usually not. The bank wants statements that show the business in plain language, and a tax return is written for the CRA.
My books are behind. Can you still do it?
Yes, but the books come first. Behind on HST explains how a catch-up works.
What did the bank ask for?
Tell us what the lender asked for and when they need it. We will come back to you with what it takes.
- 01
You send us a note
A couple of lines about the business and what you are dealing with is plenty.
- 02
We come back to you
Usually with a question or two, so the call is not spent on the basics.
- 03
We set up a call
A proper conversation about how the business runs and what your accounting actually needs.
- 04
You get a plan
What we would look after, how it would run month to month, and twelve months of pricing set out up front.
Send us a message
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