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Text 3: Finance

Historical financial data

This section will contain figures for the financial performance of the company over the last few years. It is there that people using the business plan can see how the company developed in the past.

Financial projections

The heart of the business plan is in the Financial Projections section. It pro­vides information on what the company thinks it will have to spend and what it believes it can earn on sales over the period of the business plan. The section may contain various calculations, costs, earnings as well as:

- a cash flow analysis for each year

- an income statement for each year

- a projected balance sheet for each year

- some key ratio analysis

Loan/investment

If the company sees that it will require overdrafts, loans or investments, it will need to say so in this section and say what the effects of the money will most probably be. Most importantly it will need to say what return it can offer on the investment and how much interest it is estimating it will have to pay for the overdrafts and loans. These will, of course, have been built into the financial projections in the previous section.

Vocabulary

project

проект

to project

проектувати

projection

проектування

projections

плани, проекти

calculator

калькулятор

calculation

обчислення

miscalculation

помилка в розрахунках

ratio

співвідношення, коефіцієнт, відсоток, показник, норма

analysis

аналіз

pl. analyses

overdraft

овердрафт

loan

позика, кредит

effects

результати, наслідки

17. Write down the English equivalents:

фінансове становище______________________________

фінансовий план__________________________________

прибутки________________________________________

фінансові дані____________________________________

сума овердрафту_________________________________

фінансові організації______________________________

сума кредиту_____________________________________

фінансові установи________________________________

сума інвестицій___________________________________

18. Write down the Ukrainian equivalents:

to estimate the results____________________________

returns____________________________

overdraft amount____________________

investment_________________________

cash reserves_______________________

19. Complete and translate the sentences:

1) The company may require overdrafts...

loans...

investments...

some borrowings...

extra sources of finance...

2) These expenses are estimated at...

loans...

overdrafts...

investments...

advertising campaigns...

marketing expenses...

expenditures...

20. Find the answers in the text and write them down:

  1. Why are historical financial data usually included in the business plan?

_________________

  1. What does the term financial projections mean?

_________________

  1. Do companies always need - overdrafts, loans and invest­ments?

_________________

  1. Do they always have to state - the returns on the money borrowed and on the interest paid?

_________________