If your business doesn’t qualify for bank financing, you’re probably being referred to an asset-based lender that will use your accounts receivable (AR), inventory and/or equipment as collateral for your business financing needs. To help assess the amount of financing the lender will provide, an audit is conducted. The lender doesn’t typically share the actual audit with you, but it does discuss the findings with you.
Some of the benefits the audit will provide to you include:
- Clear Understanding of Asset Value: The audit helps both the lender and you gain a clear, accurate understanding of the business’s assets. This transparency ensures that you know exactly what you can leverage for financing.
- Streamlines the Approval Process: A comprehensive audit can speed up the financing approval process by ensuring that all necessary documentation and asset valuations are readily available. This reduces the time spent on back-and-forth communication between you and the lender, leading to a faster financing decision.
- Better Asset Management Insights: The audit can provide you with valuable insights into how effectively your assets are being managed. For example, it can highlight inefficiencies in inventory turnover, receivables collection, or asset utilization. These insights can help you improve operations and increase efficiency and profitability.
In addition to these benefits, the audit can also enhance your business’s credibility with the lender and provide you with better access to future financing. While an audit may seem like an added step, it can help position your business for success. By understanding the true value of your assets and making any necessary adjustments, you can take full advantage of the financing options available to you and set your business up for long-term growth and stability.
About Celtic Capital
Companies looking for working capital to cover operating expenses, fund growth, increase buying power, and take advantage of vendor discounts and rebates turn to Celtic Capital. With an appetite for more complex transactions, Celtic Capital has a history of success in crafting creative, flexible asset-based financing solutions from $500,000 to $8 million with no financial covenants.
As an independent lender, working with companies nationwide, Celtic Capital is willing and able to alter price and deal structure and expand lines of credit to handle its clients’ increased revenues; and when cash flow is an issue, will look toward providing an inventory facility to help offset lost cash flow.
If you know of, or are, a business in need of non-traditional financing, contact Mark Hafner at 800.742.0733 or mhafner@celticcapital.com, or visit us at www.celticcapital.com.
