Handling Loan Classification in CMA Reports: What to Do When the Balance Sheet Shows Incorrect Repayments Vinu: Hey Manu, I was going through a CMA report, and I noticed something strange. The principal repayment of a term loan for the next 12 months is usually treated as a current liability. But wh...
Understanding Form 3CB and 3CD: A Guide to Tax Audits in India Vinu: Hey Manu, I’ve been hearing about Form 3CB and 3CD, and I’m a bit confused. How do I know if these forms are applicable to a firm or a company? Manu: Good question, Vinu. Forms 3CB and 3CD are part of the tax audit process in India...
Navigating High TOL/TNW Ratios: Strategies to Strengthen Your Loan Proposal Vinu: Hey Manu, we’ve received an OD loan proposal where the TOL/TNW ratio is quite high, around 14:1. But the thing is, all the other financial ratios are within the benchmark, and overall, the loan proposal looks really go...
Understanding Loan Equivalent Risk (LER): How Banks Manage Risk Beyond Currency Fluctuations Vinu: Hey Manu, I heard about this "Loan Equivalent Risk" (LER) today, but I’m confused about how it works. Could you explain it with a real example? Manu: Sure, Vinu! Let’s take an example. Imagine ABC Ltd....
Credit Appraisal of a Rice Manufacturing Unit: A Comprehensive Guide Vinu: Hi Manu, I’ve been assigned to handle the credit appraisal of a rice manufacturing unit. I’m a bit unsure where to start. Could you help me? Manu: Sure, Vinu. When appraising a rice mill, there are several aspects to consider...