Professional Documents
Culture Documents
FINANCIAL
2008 ISMAIL AB.WAHAB, MALAYSIAN ENTREPRENEURSHIP DEVELOPMENT CENTRE (MEDEC), UNIVERSITI TEKNOLOGI MA
PLAN
PLAN
FinePlanner
Complimentary
Edition
FINANCIAL PLAN
FOR SMALL AND MEDIUM BUSINESSES
2010 Ismail Ab.Wahab, Malaysian Academy of SME & Entrepreneurship Development (MASMED), Universiti Teknologi MARA
USER'S GUIDE
Name of Business/Company
Form of Business
FORECASTING
Capital Expenditure Projections
Pre-Operating and Working Capital Projections
English
Malay
Sole-Proprietorship/Others
Nature of Business
3 Years
Manufacturing
5 Years
Trading/Distribution
Service
FINANCIAL REPORTS
Pro-forma Cash Flow Statement
Pro-forma Income Statement
Pro-forma Balance Sheet
Financial Performance
Time to Break-Even
Paybak Period for Start-Up Fund
Internal Rate of Return
Gold
Award
Bronze
Award
ANCIAL PLAN
USER'S GUIDE
FORECASTING
Capital Expenditure Projections
Pre-Operating and Working Capital Projections
Sales and Purchase Projections
Forecasted Project Cost and Financing
FINANCIAL REPORTS
Pro-forma Cash Flow Statement
Pro-forma Income Statement
Pro-forma Balance Sheet
Financial Performance
BRIEF REPORTS
Time to Break-Even
Paybak Period for Start-Up Fund
Internal Rate of Return
Complimentary
Edition
Administrative/Organisation
Land & Building
Sales/Marketing
Operations/Technical
Total
Depreciation method
Straight line
F
i
n
e
P
l
a
n
n
e
r
Jika menggunakan BM, sila tukar kepada "garis lurus" atau "bak
URE PROJECTION
5
5
5
5
5
5
5
5
5
5
5
5
siah
Main Menu
Complimentary
Edition
Tax Rates
Year 1
Year 2
Year 3
F
i
n
e
P
l
a
n
n
e
r
RKING CAPITAL
10%
10%
0%
0%
25%
25%
25%
25%
25%
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2010 Ismail Ab.Wahab MASMED UiTM
Complimentary
Edition
RM
-
Sales Collections
In the month of sales
One month after sales
Two months after sales
Ending Inventory of Raw Materials
End of 2015
End of 2016
End of 2017
Purchase Projections
January
2015
February
2015
March
2015
April
2015
May
2015
June
2015
July
2015
August
2015
September 2015
October
2015
November
2015
December
2015
Total 2015
Total 2016
Total 2017
Purchase Payments
100%
0%
0%
RM
End of 2015
End of 2016
End of 2017
Fi
n
e
Pl
a
n
n
er
RM
-
s
100%
0%
0%
RM
Main Menu
Complimentary
Edition
PROJECT IMPLEMENTATION
COST
Kos Pelaksanaan Projek
Cost
Sources of Financing
0 Cash
0 Cash
0 Cash
0 Cash
0 Cash
0 Cash
0 Cash
0 Cash
0 Cash
0 Cash
0 Cash
0 Cash
0 Cash
Working Capital
months
Cash
Cash
Cash
Cash
0%
Cash
0 Cash
0
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F
i
n
e
P
l
a
n
n
e
r
Complimentary
Edition
SOURCES
OF PROJECT FINANCING
Sumber Pembiayaan Projek
Own Contributions
Existing F. Assets
Cash
Cost
0
TOTAL
Loan
Working Capital
Interest rate
Loan tenure (years)
5%
Interest rate
10
Tenure (years)
5%
5
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FinePlann
er
Hire-Purchase
Complimentary
Edition
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
0
5%
10
Annual Rest
Instalment Payments
Interest
Annual Payments
Principal
FinePlann
er
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
CHEDULE
Amount (RM)
Interest Rate
Duration (yrs)
Principal Balance
Tahun
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
0
5%
5
Bayaran Ansuran
Faedah
Pokok
BayaranTahunan
HEDULES
EDULE
Baki Pokok
Main Menu
Complimentary
Edition
DEPRECIATION OF FIX
Annual
Depreciation
0
1
2
3
4
5
6
7
8
9
10
Accumulated
Depreciation
Accumulated
Depreciation
0
1
2
3
4
5
6
0
0
Straight Line
5
Annual
Depreciation
0
1
2
3
4
5
6
7
8
9
10
Book Value
Book Value
0
0
Straight Line
5
Annual
Depreciation
Accumulated
Depreciation
Book Value
7
8
9
10
Accumulated
Depreciation
0
1
2
3
4
5
6
7
8
Accumulated
Depreciation
Book Value
0
0
Straight Line
5
Annual
Depreciation
0
1
2
3
4
5
6
7
8
9
10
0
0
Straight Line
5
Annual
Depreciation
0
1
2
3
4
5
6
7
8
9
10
Book Value
0
0
Straight Line
5
Annual
Depreciation
Accumulated
Depreciation
Book Value
9
10
FinePlan
N OF FIXED ASSETS
0
0
Straight Line
5
Annual
Depreciation
0
1
2
3
4
5
6
7
8
9
10
Accumulated
Depreciation
Accumulated
Depreciation
0
1
2
3
4
5
6
0
0
Straight Line
5
Annual
Depreciation
0
1
2
3
4
5
6
7
8
9
10
Book Value
Book Value
0
0
Straight Line
5
Annual
Depreciation
Accumulated
Depreciation
Book Value
7
8
9
10
Accumulated
Depreciation
0
1
2
3
4
5
6
7
8
Accumulated
Depreciation
Book Value
0
0
Straight Line
5
Annual
Depreciation
0
1
2
3
4
5
6
7
8
9
10
0
0
Straight Line
5
Annual
Depreciation
0
1
2
3
4
5
6
7
8
9
10
Book Value
0
0
Straight Line
5
Annual
Depreciation
Accumulated
Depreciation
Book Value
9
10
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2010 Ismail Ab.Wahab MEDEC UiTM
PVIFA=
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0.6139
7.7217349292
Int
-
annual payme
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
-
Balance
-
Complimentary
Edition
MONTH Pre-Operations
January
February
CASH INFLOW
Capital (Cash)
Loan
Cash Sales
Collection of Accounts Receivable
0
0
0
0
Other Expenditure
CASH OUTFLOW
Pre-operating & Incorporation Expenditure
Hire-Purchase Repayment:
Principal
Interest
Principal
Interest
Tax Payable
Loan Repayment:
FinePl
an
PRO-FORM
April
May
June
July
0
0
0
0
0
0
0
0
0
0
W
August
September
October
November
December
0
0
0
0
0
0
0
0
0
0
ATEMENT
2015
2016
2017
0
0
0
0
0
0
Complimentary
Edition
2015
2016
2017
0
#VALUE!
0
#VALUE!
#VALUE!
#VALUE!
Sales
Less: Expenditure
Pre-Operating & Incorporation Expenditure
Other Expenditure
Interest on Hire-Purchase
Interest on Loan
Total Expenditure
#VALUE!
#VALUE!
Tax
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
0
0
Complimentary
Edition
2016
2017
Main Men
ASSETS
Pro-forma Income
0
-
0
-
Pro-forma Balanc
Financial Perfo
Other Assets
Deposit
Current Assets
SUMMARY
2015
2016
Inventory
Accounts Receivable
0
0
0
0
0
0
Cash Balance
Capital
Accumulated Income
#VALUE!
#VALUE!
#VALUE!
#VALUE!
TOTAL ASSETS
2017
Owners' Equity
Long-Term Liabilities
Loan Balance
Hire-Purchase Balance
Accounts Payable
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
#VALUE!
Current Liabilities
FinePlanner
FINANCIAL P
Complimentary
Edition
2015
LIQUIDITY
Current Ratio
NA
NA
EFFICIENCY
Receivable Turnover
NA
Inventory Turnover
NA
PROFITABILITY
Gross Profit Margin
NA
#DIV/0!
Return on Assets
#DIV/0!
Return on Equity
#DIV/0!
SOLVENCY
Debt to Equity
#DIV/0!
Debt to Assets
#DIV/0!
#DIV/0!
Break-even Analysis
Total projected sales(RM)
Total variable costs (cost of sales)
Contribution margin
Contribution margin ratio
Fixed costs
Total costs
Net Profit
2015
NA
NA
NA
Break-even sales
Percentage of break-even to sales
Current Ratio
Current Ratio
Receivable Turnover
Return on Assets
Return on Assets
Debt to Equity
Time In
FinePlan
ner
NANCIAL PERFORMANCE
Ratio
Prestasi Kewangan
2016
2017
2018
2019
Main Menu
Pro-forma Cash Flow Statement
NA
NA
#VALUE!
#VALUE!
NA
NA
#VALUE!
#VALUE!
NA
NA
#VALUE!
#VALUE!
NA
NA
NA
NA
NA
NA
NA
NA
#DIV/0!
#DIV/0!
#VALUE!
#VALUE!
#DIV/0!
#DIV/0!
#VALUE!
#VALUE!
#DIV/0!
#DIV/0!
#VALUE!
#VALUE!
#DIV/0!
#DIV/0!
#VALUE!
#VALUE!
#DIV/0!
#DIV/0!
#VALUE!
#VALUE!
#DIV/0!
#DIV/0!
#VALUE!
#VALUE!
INTERNAL RATE OF
RETURN (IRR)
2016
2017
-
NA
NA
NA
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NA
NA
NA
NA
NA
NA
NA
NA
NA
TIME TO BREAK-EVEN
#VALUE!
#VALUE!
Ratio
Turnover
Inventory Turnover
t Margin
Assets
Return on Equity
Assets
Return on Equity
Debt to Assets
Equity
st)
2015
Current Ratio
NA
NA
2016
NA
2015
2016
NA
2015
Receivable Turnover
NA
2016
NA
2015
Inventory Turnover
NA
NA
2016
NA
2015
2016
NA
2015
2016
#DIV/0!
#DIV/0!
Return on Assets
2015
#DIV/0!
2016
#DIV/0!
Return on Equity
2015
#DIV/0!
2016
#DIV/0!
st)
Debt to Equity
2015
#DIV/0!
2016
#DIV/0!
Debt to Assets
2015
#DIV/0!
2016
#DIV/0!
2015
#DIV/0!
2016
#DIV/0!
2017
NA
2018
2019
#VALUE! #VALUE!
2017
NA
2018
2019
#VALUE! #VALUE!
2017
NA
2018
2019
#VALUE! #VALUE!
2017
NA
2018
NA
2017
NA
NA
2018
NA
2017
2019
2019
NA
2018
2019
2017
2018
2019
#DIV/0! #VALUE! #VALUE!
2017
2018
2019
#DIV/0! #VALUE! #VALUE!
2017
2018
2019
#DIV/0! #VALUE! #VALUE!
2017
2018
2019
#DIV/0! #VALUE! #VALUE!
BRIEF REPORT
TIME TO BREAK-EVEN
BRIEF REPORT
BRIEF REPORT
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BRIEF REPORT
RM
Back to Main Menu
BRIEF REPORT
0
Back to Main Menu
BRIEF REPORT
SOURCES OF FINANCING
Cash
Existing F. Assets
Loan
Hire-Purchase
Total
Back to Main Menu
BRIEF REPORT
SOURCES OF FINANCING
RM0
RM0
RM0
RM0
RM0
Back to Main Menu
BRIEF REPORT
CASH BALANCE
2015
2016
2017
RM
RM
RM
BRIEF REPORT
CASH BALANCE
0
0
0
BRIEF REPORT
2015
2016
2017
RM
RM
RM
BRIEF REPORT
0
0
0
BRIEF REPORT
2015
2016
2017
RM
RM
RM
BRIEF REPORT
0
0
0
BRIEF REPORT
2015
2016
2017
RM
RM
RM
BRIEF REPORT
LIABILITIES
RM 0
RM 0
RM 0
0
0
0
BRIEF REPORT
RM 0
Back to Main Menu
BRIEF REPORT
per month
BRIEF REPORT
RM
Back to Main Menu
BRIEF REPORT
per month
Back to Main Menu
FinePlan
FINANCIAL PLANNING PACKAGE FOR SMALL AND MEDIUM BUSINESSES
PROF. MADYA DR. ISMAIL AB.WAHAB, MALAYSIAN ENTREPRENEURSHIP DEVELOPMENT CENTRE (MEDEC),
FACULTY OF BUSINESS MANAGEMENT, UNIVERSITI TEKNOLOGI MARA, SHAH ALAM, SELANGO R
Objective
FinePlanner is a tool that can assist small and medium-sized entrepreneurs in the
preparation of professional, comprehensive and presentable financial projections for
business start-up and expansion.
Novelty
Dual language: English and Malay Generate comprehensive and presentable financial
projection up to five years
Suitable for businesses engaged in manufacturing, trading or services
Suitable for incorporated or unincorporated businesses
Suitable for all levels of existing and potential entrepreneurs: students & graduates
entrepreneurs, corporate entrepreneurs, rural entrepreneurs, agro entrepreneurs, etc.
Getting Started
Before you start the planning process, select the language by clicking English or Malay buttons planning period.
vSelect the planning period (3 or 5 years).
vChoose first year of planning period and first month of planning period.
vSelect the legal form of business (private limited company or sole-proprietorship and others)
vSelect nature of business (manufacturing, trading/distribution or service)
Financial Forecasting
vClick Capital expenditure projections menu for entering the projected cost of each fixed assets required for
business. Please key in the cost of new fixed assets and/or the market value for existing fixed assets (if an
Determine the number of years of economic or productive life for each asset (except land & building). The econo
life of an asset refers to the period (normally expressed in number of years) whereby the asset can be economic
used i.e. without much maintenance or breakdowns.
v Next, select the depreciation method for all assets. The recommended method for calculating depreciation
either straight-line or declining balance. The simplest and most commonly used is straight line method. It is calcula
by taking the purchase or acquisition price of an asset subtracted by the salvage value divided by the total produc
years the asset can be reasonably expected to benefit the company [called useful life in accounting jargon].
planning purposes, the salvage value can be zero. The declining method of depreciation accelerates deprecia
faster than the straight-line method because it bases each year's depreciation on the assets previous-year net b
value.
vGo back to the main menu.
v First, determine the pre-operating and incorporation costs. The pre-operating cost can includes busin
registration and licences, legal fees , stamp duties etc.
v Next, estimate the sales and marketing costs, general and administrative costs, and operations a
technical costs. These costs are incurred every month and are generally known as working capital. Other costs wh
are not paid monthly but are incurred every year can be included under other expenditure (annually) category s
as payment of road tax and insurance for motor vehicles, licences etc.
vEstimate the increment rate for working capital expenditure (if any). Next, choose the current and estimated rates
corporate taxation from the list. The system will only calculate the amount of tax for private limited company.
vGo back to the main menu.
vFill in the sales projections table. Sales (or revenues) refers to the sales forecast derived from the
marketing plan. It is the total of forecasted cash and credit sales for each year throughout the planned
period. amount
vThe
Sales are
of to
monthly
be forested
purchases
monthly
in the
(first
purchase
planningProjections
year) and annually
table should
(after first
be equal
year).to the amoun
purchases that have been projected in the working capital section under operations and technical cos
category.
vIf there some credit sales or purchases, choose the percentage of credit sales collections and cred
purchase payments in the columns provided.
vNext, estimate the ending inventory of raw materials and finished goods (for manufacturing
businesses only). For trading and distribution businesses, the ending inventory figures are to be entered
the ending inventory of finished goods column only. It is assumed that there is no ending inventory fo
businesses involved in service industry. If your businesses are involved in both trading and service
activities, please select trading/distribution category under nature of business in the main menu.
vGo back to the main menu.
vThe sources of financing schedule shows various sources of finance available to fund the business
These could be internal and external sources of finance. The internal sources of finance include equity
contributions in cash and/or existing assets. External sources may include term loan and hire purchase
For planning purposes, other sources such as grants and money borrowed from individuals should be
considered as own cash contributions. For each asset and working capital required, p lease choose the
type of financing from the list provided in the sources of financing column.
vThe amount of working capital is dependent upon the period until the business can generate enoug
sales to cover its short-term expenditure. Therefore, the amount of working capital needed could be in th
range of one to six months. Please select the number of months from the list provided in relevant colum
vThe final component of the project cost is provision for contingency. This cost is added to the total cost of
other four components based on a certain percentage (usually between 5 to 10 percent). The reason for includ
contingency cost in the project implementation cost schedule is to take care of any variance of the actual from
budgeted expenditure. For example, if the cost of materials increases during the planned period, the firm can uti
this fund to cover the extra cost without having to search for new funding.
SUMMARY AND SCHEDULES
This section presents the supporting schedules relating to the information that have been provided
the forecasting section. The schedules are project cost and sources of funds summary, fix
assets and depreciation schedules, and loan amortization schedule.
REPORTS AND ANALYSIS
This section presents the pro-forma financial statements and analysis of the financial performance a
position of the proposed project.
Pro-forma cash flow statement
v Pro forma cash flow statement refers to the projected statement of cash inflows and outflo
throughout the planned period. Under normal circumstances, the pro forma cash flow statement
prepared between three to five consecutive years, with monthly details for the first year. The pro form
cash flow statement shows the following information:
Cash inflows the projected amount of cash flowing into the company.
Cash outflows the projected amount of cash flowing out of the company.
Cash deficit or surplus the difference between cash inflows and cash outflows.
Cash position the beginning and ending cash balances for a particular period.
Pro-forma Income Statement
vThe pro forma income statement shows the expected profit for the planned period. T
statement shows the following information:
Gross profit
Net profit
vGross profit is the gross margin realised after deducting the cost of goods sold from
sales. It represents the amount of profit before deducting other operating expenditure such
as administration expenditure, marketing expenditure, operations expenditure (for a tradin
entity), interest charges, depreciation charges on fixed assets (except for a manufacturing
concern) and other miscellaneous expenditure incurred throughout the year in order to
obtain the net profit before tax.
Pro-forma Balance Sheet
vWhile the pro forma income statement shows the financial performance of the
company for the planned period, the pro forma balance sheet shows the financial position o
the company at a specific point in time in terms of assets owned and how those assets are
financed. The pro forma balance sheet is prepared for a period of three years.
vThe general elements of the pro forma balance sheet include:
assets
owners equity
liabilities
vAssets are the economic resources of a business that are expected to be of benefit in th
future. Assets reported in the balance sheet are generally categorised into two categories:
non-current and current assets.
vNon-current assets include fixed assets and other assets that are owned and usua
held to produce products or services. These assets are not intended for sale in the short
term. Examples: property, plant, machinery, equipment, vehicles, major renovations and
long-term investments. For fixed assets, the values shown in the balance sheet are the boo
value i.e. the original cost less the accumulated depreciation.
vCurrent assets are short-term assets that can be converted into cash within a year.
Examples: cash, inventories (raw materials, work-in-process and/or finished goods),
receivables and other short-term investments.
vOwners equity refers to capital contributions from the owners or shareholders in term
of cash or assets plus the accumulated amount of net income. However, if the business
suffers a loss, the amount of loss will be deducted from the capital contributions.
vLiabilities are the amounts owed by the business to outsiders. They are categorised as
non-current
(long-term)
and current
liabilities.
vNon-current
or long-term
liabilities
refer to the long-term obligations of the busines
that mature in a period of more than one year. They usually include long-term loans as well
as
hire purchase.
vCurrent
liabilities refer to the short-term obligations of the business that mature withi
period of less than a year. The most common forms of current liabilities are accounts payab
and accrued payments
Financial Analysis
vFinancial analysis is a technique of examining financial statements to help the
entrepreneur analyse the financial position and performance of the business.
vFinancial analysis involves two basic steps: generating the information from the financia
statements and interpreting the results.
vThe most common form of financial analysis is ratio analysis.
vFinancial ratios are normally used to compare figures from the financial statement with
other figures, so that the true meaning of financial pictures can be obtained.
vThere are various financial ratios that the entrepreneur can look at. However, the most
commonly considered ratios in small business decision-making fall into four categories:
liquidity, efficiency, profitability and solvency.
v Liquidity Ratio: The term liquidity refers to the availability of liquid assets to meet short-te
obligations. Thus, liquidity ratios measure the ability of the business to pay its monthly bills.The m
widely used liquidity ratios are current ratio and quick ratio. Current ratio can be determined
dividing total current assets by total current liabilities. Generally, this ratio shows the business ability
generate cash to meet its short-term obligations. Quick ratio, also known as the acid test ra
measures the extent to which current liabilities are covered by liquid assets. To determine quick rat
the calculation of liquid assets does not take into account inventrories since it is sometimes difficult
convert them into cash quickly.
v The efficiency ratios measure how efficient the business uses its assets to generate sales. T
most widely used efficiency ratio for planning purposes is inventory turnover ratio. Inventory turnov
(or stock turnover) measures the number of times inventories have been converted into sales a
indicates how liquid the inventory is. All other things being equal, the higher the turnover figure, t
more liquid the business is. This ratio divides the cost of sales (or cost of goods sold) by the avera
value of inventory. The average value of inventory is derived by adding the opening and closing balan
of and dividing the total by two.
v Profitability ratios are important indicators of the business financial performance. Investors w
particularly be interested in these ratios since they measure the performance and growth potential
the business. Some of the commonly used profitability ratios are gross profit margin, net profit marg
return on assets and return on equity. Gross profit margin give a good indication of financial health
the business. Without an adequate gross margin, the business will be unable to pay its operating a
other expenses. Gross profit margin is calculated by dividing the business gross income by sales. N
profit margin is an indication of how effective the business is at cost control. The higher the net pro
margin, the more effective the business is at converting sales into actual profit. Net profit margin
calculated by dividing the business net income by sales. Return of assets measures the overall retu
that the business is able to make on its assets. This ratio is derived by dividing the business net pro
by total assets. Return of equity shows what the business has earned on its owners investment in t
business. This ratio is derived by dividing the business net profit by total equity.
This final category of ratios i.e. Solvency Ratios, is designed to help the entrepreneur measure the
degree of financial risk that his business faces. By referring to this ratio, the entrepreneur can assess
level of debt and decide whether it is appropriate for the business. The most commonly used solvency
ratios are total debt (liabilities) to equity (also known as leverage or gearing), total debt to total asset
and times interest earned (also known as interest coverage). The total debt to equity ratio measu
the percentage of the business assets financed by creditors relative to the percentage financed by th
owners. This ratio is calculated by dividing the the total debt by total equity. The debt to asset rat
measures the percentage of the business assets financed by creditors relative to the percentage
financed by the entrepreneur. This ratio is calculated by dividing the total debts by total assets. Time
interest earned ratio measures the number of times interest expense can be covered by profit befo
interest and tax. This ratio is calculated by dividing total inte
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