Rainy Lake Tribal Area Business & Financial Services Corporation.




Financial Projections & Analysis

Financial Projections & Analysis

The Financial section of your business plan is all about the numbers. Here a list of some suggested items that you should include with your business plan.

  • If available, include historical financial statements (balance sheet and income statement) for the last 3 years as well as an analysis outlining strengths and weaknesses or any area(s) of concern.
  • Financial projections should consist of the following:
    • Opening Balance Sheet (at start of proposed project)
    • Balance Sheet (at end of year 1,2,3)
    • Cash Flow Statement (for years 1,2 & 3 with the first 12 months being presented on a monthly basis)
    • Income Statement (for years 1,2,& 3, with the first 12 months being presented on a monthly basis)
  • Financial projections should be accompanied by all assumptions: eg. sales are based on what analysis – historical sales, market analysis, etc.
  • Outline any strengths, weaknesses or area(s) of concern with financial projections
  • Financial analysis should include:
    • Breakeven analysis – how much sales volume is required to cover costs
    • Ratio analysis eg.;
      • Liquidity: Current ratio=Current Assets/Current Liability
      • Leverage: Debt to Equity (%) = Total Debt/Equity
      • Profitability: Return on Equity (%) = Net Income/Owner’s Equity                                                                                                                                                                         Return on Investment (%) = Net Income/Total Assets
      • Ratio Analysis should include a comparison against industry norms (Dun & Bradstreet Canada, Performance Plus – ic.gc.ca) and explanation of any significant variances that occur.

Below you will find some tools to help you complete this section.

Financial Planning