It is hard to believe 2019 is coming to a close and the 2020 renewal season is just around the corner. As you prepare for loan renewals at your lending institution, consider these FINPACK tools to help make the process smoother and more streamlined for you and your customer.
Balance Sheet Tools
- The FINPACK Balance Sheet Input Worksheet is designed to help gather customer data for year-end analysis and credit renewal. This FINPACK tool creates the selected customer balance sheet as a worksheet. The customer can then update the balance sheet information with current values; add assets and loans if needed; and remove items no longer related to the business. This worksheet can be given to customers now, so they can be prepared for their upcoming year-end analysis or credit renewal visit. Visit our previous post on using and accessing the FINPACK Balance Sheet Worksheet. If you have a new customer, a balance sheet input form is available in the FINPACK Knowledge Base.
- FINPACK now includes the ability to import and export balance sheet data from CSV files. The process works for the intermediate, long term, and personal assets of the agricultural balance sheet and noncurrent and personal assets of a commercial balance sheet. This streamlined method can be used for entering or editing balance sheet detail. Specific steps related to the import/export process are found in this help guide.
FINPACK Lite is a free, balance sheet only version of FINPACK, available to your customers. (As a lender using FINPACK, you have the right to distribute FINPACK Lite to your customers.) The FINPACK Team knows getting balance sheet information from a customer is crucial. This is the starting point of the analysis process. FINPACK Lite is a streamlined approach that will save both you and your customer time and effort. FINPACK Lite can be downloaded here. After downloading the software, customers can easily and accurately enter their balance sheet information. The customer then provides the balance sheet to their lender. As a lender, you can import this balance sheet directly into the customer file if you so choose.
Schedule F Analysis
For farm borrowers, calculating accrual adjusted net farm income is the best approach to measuring farm profitability. FINPACK’s Schedule F Accrual Analysis tool takes the cash-based Schedule F tax return and generates an accrual analysis. To accurately complete this task, a lender must gather some additional information beyond the Schedule F tax form and bookend balance sheets for the tax year. A few examples include cull livestock income; capital asset purchases and sales; personal income; and family living or owner withdrawals. Use the Schedule F Analysis Input Form (found in the FINPACK Knowledge Base) to help gather all of the needed information from your customer to get an accurate accrual analysis for the farming operation. There are often common, but tricky situations at year-end that lead to cash discrepancies. Use the Sleuthing Cash Discrepancies white paper to assist with tracking down these cash discrepancy culprits.
Cash Flow Projection Tools
Like the FINPACK Balance Sheet, there is an input worksheet for FINPACK cash flow projections. This worksheet is accessed in the same manner, through the Print dialogue box. A worksheet version of a customer’s previous cash flow is available for all three types of FINPACK projections – annual, monthly, and monthly with budgets. This worksheet can be used by the customer to help the lender gather information related to loan renewal, specifically for the current year’s cash flow projection. If your lending institution prepares monthly cash flow projections with budgets, there are also crop and livestock budget input forms for your use. The Center for Farm Financial Management has also prepared additional cash flow planning tools for your use. These aides include the Minnesota Price and Cost Summary and the FINPACK Livestock Budget Estimates.
The FINPACK Team hopes these tools can help make the credit renewal process at your institution more streamlined and efficient. Feel free to contact our team with questions or technical needs.