CMA data required for bank loan or working capital loan or for seeking CC limit. But the question is that what is CMA data and How to prepare it? Why bank or financial institute required CMA data? so here is your answer
First of all let us understand what is CMA Data
CMA is short form of Credit Monitoring Arrangement data.CMA data report presented to bank to Show your past, prasent and future Financial position.
CMA covers 7 statement which are as follow
1 Existing and Proposed Funds Limit
In this statement one must show present fund and non fund based credit limit .of the borrower ,their usage limit and history. Which means you should show current financial condition, borrowed fund and proposed fund are covered. In the case , business is new, there is no past records so you need to give proposed data.
2 Operating statement:
In this Second statement one should required to show past 2 years and future 3 to 5 years ( Proposed) operating statements. You should show Profit before and after Tax and projection of Sales ,Expenses and profit for 3 to 5 year as per requirement.
3 Analysis of Balance sheet
In this third statement one should required to show past years and future years projection Data of Balance Sheet. In this statement you should give detailed analysis of Current Assets ,Non current Assets, Fixed Assets ,Cash and Bank Position ,Current liability ,Non Current Liability etc.
4 Comparative statements of current assets and liabilities:
In this fourth statement you need to show comparative analysis of Current Assets and Current liability . This statement is for working Capital Cycle for the project period and capacity of the borrower to meet the future working capital requirement
5 Calculation of MPBF:
MPBF means maximum permissible bank finance. In this calculation you should show the capacity of the borrower to borrow the money, This Calculation is done by two method
1 In the first method lending will allowed the MPBF 75% of net working Capital GAP
2 In the Second method lending will allowed the MPBF 75% of Current Assets less Current Liability
6Fund flow statements:
In this statement you required to give details of the fund flow for current and future projected period. This statement show borrower fund position with the reference of the working capital analysis given in the MPBF. It shows the Funds Movement of the borrower.
7 Ratio analysis:
This statement is long and important statement of CMA data. It gives Key ratio to the banker and Based on CMA data prepared and submitted to the bank . Generally this covers GP ratio ,NP ratio ,Current Raton, DP limit Net worth ,Quick Ratio, turnover ratios, Debt equity ratios, DSCR etc.
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