Academic journal article Journal of Accountancy

Getting the Right Loan with the Right Bank

Academic journal article Journal of Accountancy

Getting the Right Loan with the Right Bank

Article excerpt

Whether a CPA firm is seeking new financing or refinancing existing debt, it is never a bad time to review its banking relationship and investigate new opportunities. Careful determination of the criteria important to the firm is necessary to properly evaluate each bank. The checklist below not only will help prepare firms for the review process, but it should expedite the bank interview while maximizing the firm's banking options.

PREPARING FOR THE INTERVIEW

* Select three banks to interview.

* Establish what the financing needs will be and how the funds would be used.

* Determine desirable interest rates and repayment period.

WHAT TO INQUIRE ABOUT DURING THE INTERVIEW

* The bank's knowledge of the accounting profession.

* The amount of financing the bank will provide.

* Cost of financing, including repayment terms.

* Various bank services and pricing of those services.

* Possibility of developing working synergies as a way of establishing sources of new business referrals.

* Bank technologies, such as online bank transfers and balance information and overnight investing.

* Personal loan and other executive banking privileges available to partners and other key executives. …

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