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Requirements a Company must meet before raising Debt Finance.
1. The company must provide a summary of history of the business and its nature. This is used to assess the risk of the company’s business line.
2. Details of management – names, ages, qualification and experience of managers and directors. If these are of questionable integrity, such as a company may not get debt finance.
3. To produce five years audited accounts which will reflect t he company ‘s financial ability to service debt finance.
4. the purpose of the loan must be;
• within the lender’s priority
• Within the government areas of priority for development purposes.
5. Furnish lenders with cash flow forecast and proposed trend of repayment.
6. Major shareholders of the company must give consent to the loan.
lydiajane74 answered the question on May 9, 2018 at 19:31
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