Business & liquidity review
We work with financial stakeholders to conduct a review of the liquidity and related cash flow forecasts of borrowers to understand and analyse drivers of cash flow. For example: trading performance, working capital, restructuring costs or provision payments. This work requires us to assess amongst others, intra month peak requirements, vulnerabilities and potential upsides. This provides lenders with an independent view on whether its borrower has adequate liquidity to continue operating normally, thereby allowing time for the lenders to consider their options
By conducting high level ‘stress tests’ and analysis of the borrower’s business plan, lenders can take a view as to whether the business plan provides a reasonable basis to determine the debt capacity and to make future lending decisions by:
- Carrying out a review of track record plus normalising one-off exceptions, in order to provide a basis to test and challenge the management’s business plan;
- Assessing revenue, costs and cash conversion assumptions included in the plan, and commenting on their reasonableness; and
- The use of specialist Deloitte resources to review specific aspects of the plan. (For example: prevailing market assumptions, operational metrics / improvements, pension and tax.)
To find out more, please contact Lieve Creten or Hilde Wittemans.
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