A funding conversation is easier when you can explain what the money will achieve, when it is needed and how the business expects to meet its obligations. Financial information should support that explanation with consistent figures and evidence. A polished presentation cannot compensate for unexplained balances or unrealistic assumptions.
In this article
- Confirm what the lender requests
- Prepare consistent accounts and forecasts
- Explain assumptions and funding use
- Review the figures before discussions
Different lenders and investors ask for different documents. Before building a large pack, obtain the recipient's requirements, reporting period and preferred format. Then assemble information that answers their questions and that you can explain confidently.
Define the request before assembling documents
Write a short statement of purpose: what the funds will pay for, the amount required, the timing and the business benefit. Break a general request for “growth funding” into equipment, stock, recruitment, premises or working capital.
Show your own contribution and any existing financing. Avoid treating a desired borrowing amount as evidence of affordability. Model repayments and other obligations alongside existing cash commitments, using terms confirmed by the potential provider where available.
The British Business Bank's loan application guidance explains that documentation varies and may include financial accounts, bank statements, forecasts and existing finance details. Confirm the actual list directly rather than assuming every application is identical.
Create a pack that reconciles
Use a contents page, clear dates and a single version of each document. Explain whether figures are final accounts, draft accounts or management information. Include the accounting period and reporting basis so recipients understand what they are comparing.
A useful preparation checklist is:
| Information | Check before sharing |
|---|---|
| Annual accounts | Correct entity, period and final or draft status |
| Recent management accounts | Bank reconciled; unusual items explained |
| Cash forecast | Opening cash matches evidence; assumptions visible |
| Customer and supplier balances | Old, disputed or overdue amounts identified |
| Borrowings and leases | Balances, payment dates and commitments consistent |
| Investment budget | Quotes, timing and contingency explained |
| Business plan | Trading story agrees with forecast numbers |
The point is consistency. If the forecast assumes rapid expansion but the plan describes limited staffing capacity, resolve the difference. If management accounts differ from annual accounts because of adjustments or periods, provide a short reconciliation.
Make the forecast defensible
Build sales assumptions from identifiable drivers: contracted work, expected volumes, capacity and prices. Separate confirmed orders from pipeline opportunities. Do not assign the same certainty to both.
Explain costs, payment timing and one-off expenditure. Include a downside case showing the effect of slower growth or delayed collections, with actions management could take. Avoid presenting projected cash as money already secured.
GOV.UK's business plan guidance identifies objectives, strategies and financial forecasts as core planning information. Your funding pack should connect those elements, rather than attach an isolated spreadsheet to a narrative that uses different assumptions.
Illustrative example: buying production equipment
Suppose a small producer is considering equipment to reduce outsourcing and increase output. Its forecast estimates more sales, but the initial draft leaves out installation downtime, training and additional stock.
The revised pack separates equipment and installation spending, shows the production start date and explains the expected change in unit cost. It also includes a slower sales case and the effect on cash of holding more inventory.
Management gathers supplier quotations and reconciles existing finance payments to bank records. It can now explain both the commercial opportunity and the pressure points. This illustrative preparation may improve the clarity of a conversation; it does not guarantee funding or a particular offer.
Anticipate the questions behind the figures
A lender may ask what happens if a major customer pays late, why recent profit changed or whether existing obligations restrict new borrowing. An investor may focus on growth, ownership, management and future returns. Ask which questions are relevant to the proposed funding route.
Prepare honest explanations for weaknesses. A temporary loss caused by a documented event is different from an unexplained deterioration. Label uncertain information and describe what is being done to improve it. Concealing problems can undermine the credibility of otherwise sound records.
Maintain a short question log during discussions so every recipient receives consistent, updated answers. When changing a forecast, date the revision and explain what changed.
Share information carefully
Check the recipient and use an appropriate secure transfer method. Financial packs can include personal information, bank details, customer data and commercially sensitive contracts. Share what is requested and relevant; use a redacted version where detailed personal or customer information is unnecessary.
Financial preparation is separate from recommending or arranging a particular funding product. Confirm the provider's role and obtain legal or specialist advice before accepting security, guarantees, ownership changes or financing terms.
Do we need audited accounts? Ask the intended recipient. Do not assume an audit is required or that ordinary accountancy support includes one.
Can a forecast be prepared from incomplete records? Gaps can be disclosed, but resolve material uncertainties before relying on the forecast.
EPOS Accountancy can discuss an agreed scope of outsourced CFO support for financial preparation and review. Bring the requested document list, current accounts and proposed use of funds. Funding decisions remain with the relevant provider; fee enquiries are available through pricing.