Securing finance for a small private school

Background/ Situation

A small private school, with an established brand and high profile, was seeking finance from a major Australian bank. Members of the school’s finance committee, two of whom were clients, referred the task to MACHUS Solutions as they knew we had extensive experience managing similar projects.

Initial Findings

Preliminary research indicated that the school’s accounting and financial records were not up to date. In addition, the accounting system needed some work before documentation could be prepared for the bank. It was also found that the school’s premises had limited security value for the banks as school zoning limits the ability to market the real estate in case of loan default.

Solutions, Strategies and Recommendations

All dealings were channelled through a member of the finance committee, however most members offered assistance and cooperation. In order to make the finance application, MACHUS prepared the following documents:

• Historical accounts for the school
• Projected Profit and Loss Statements for five years. This was complicated as the school was expanding to include secondary students
• Projected Cash Flow Statements for three years
• The application submission

Implementation and Results

MACHUS presented the submission to the bank and negotiated the terms of a loan on behalf of the school. The loan was approved within a few weeks from the original brief.