Starting a business: Have you established your three-year financing plan?

In order to easily carry out the steps to create a business, you will have to accomplish different steps. You start by preparing the project, drafting the company’s articles of association, opening a bank account to deposit your capital, publishing legal notices and completing the mandatory steps. The creation of companies also involves defining the company’s financial forecasts valid over several years. A 3-year financing plan is set up after having established an initial financing plan, drawn up an income statement and then drafted a cash flow plan.

What is the purpose of the financing plan?

The purpose of the 3-year financing plan is to help entrepreneurs to think about the next investments for the company. This plan makes it possible to make financial forecasts. The principle of this plan is to assess the company’s sustainability. A company must have stable financial resources to deal with unpaid debts, overvalued turnover and other contingencies. To save time, contact specialists such as statutentreprise.com.

Thanks to the 3-year financing plan, the entrepreneur monitors the evolution of the company’s financial structure. As for the initial financing plan, the plan that takes into account the turnover over 3 years allows to evaluate the financial resources during the first 3 years of the company.

How to set up a financing plan?

The elaboration of a 3-year financing plan is a solution to determine the forecasts. To put them in place, all you have to do is retrieve the contents of the initial financing plan. New elements obtained during the company’s activity are added, notably the self-financing capacity or CAF. The CAF refers to the company’s profit after the payment of taxes and duties as well as depreciation allowances. It is simply the revenue obtained after paying the mandatory tax.

Setting up a forecast table

The establishment of a forecasting table takes place in 2 stages. First of all, the table is based on the first year, it will be necessary to set up the Needs and Resources columns. The Needs column contains the initial financing plan and the capital repaid at the time of the first year. In the case of a sole proprietorship, the column shows the operator’s levies as remuneration.

The Resources column contains the amount of the PAYE and the elements of the original financing plan. Then the forecast table should focus on years 2 and 3. This second step takes into account only the sustainable resources or new elements that have emerged during each year.

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