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General overhead

TOTAL CORPORATE SUPPORT

Profit contribution (before taxes)
326 APPENDIX A


WORKSHEET #3

PRO FORMA CASH FLOW STATEMENT
ABC CORPORATION PRO FORMA CASH FLOW STATEMENT
FOR THE YEAR ENDED 20XX

1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter YEAR Assumption

Sources (uses) of cash
Net earnings (loss)
Depreciation and amortization
Cash provided by operations
dividends
Cash provided by (used for)
changes in:
Accounts receivable
Inventory
Other current assets
Accounts payable
Income tax
Accrued compensation
Dividends payable
Other current liabilities
Other assets
Net cash provided by (used for)
operating activity
Investment transactions
Furniture and equipment
Land
Building and improvement
Net cash from investment
transactions
Financing transactions
Short-term debt
Long-term debt
Other noncurrent liabilities
Sale of common stock
Net cash from financing
transactions
Net increase (decrease) in
cash
Cash: Beginning of period
Cash: End of period
WORKSHEET #4
PRO FORMA INCOME STATEMENT
ABC CORPORATION PRO FORMA INCOME STATEMENt
Current Year Year 1 Year 2 Year 3 TOTAL Assumptions
Net sales
Cost of sales (schedule will
vary based on type of business)

Gross margin

Operating expenses
Depreciation and amortization

Selling, general, and
administrative expenses
Operating income (loss)

Other income (expense)

Dividends and interest income
Interest expense
How to Write and Present an Investor-Oriented Business Plan




Earnings (before income taxes)

Income taxes

Net earnings
Common shares outstanding

Earning per common share
327
WORKSHEET #5
328

PRO FORMA BALANCE SHEET
ABC CORPORATION PRO FORMA BALANCE SHEET AS OF
PAGE 1 OF 2
Current Year Year 1 Year 2 Year 3 TOTAL Assumptions
ASSETS
Current assets:
Cash
Marketable securities
Accounts receivable
Inventories
Prepaid expenses
TOTAL CURRENT ASSETS
Property, Plant, and Equipment
Land
Buildings
Machinery
Leasehold improvements
Furniture, fixtures, etc.
TOTAL PROPERTY, PLANT,
AND EQUIPMENT
Less accumulated depreciation
Net property, plant, and equipment
Intangibles (goodwill, patents)
less amortization
TOTAL ASSETS
APPENDIX A
PRO FORMA BALANCE SHEET
ABC CORPORATION PRO FORMA BALANCE SHEET AS OF
PAGE 2 OF 2
Current Year Year 1 Year 2 Year 3 TOTAL Assumptions
LIABILITIES
Current liabilities:
Accounts payable
Notes payable
Accrued expenses
Income taxes payable
Dividends payable
Other liabilities
TOTAL CURRENT LIABILITIES
Long-term liabilities
Deferred income taxes
Securities payable (year)
Other long-term debt
How to Write and Present an Investor-Oriented Business Plan




TOTAL LIABILITIES
SHAREHOLDERS™ EQUITY
Preferred stock
Common stock
Additional paid-in capital
Retained earnings
TOTAL SHAREHOLDERS™ EQUITY
TOTAL LIABILITIES AND
SHAREHOLDERS™ EQUITY
329
330 APPENDIX A


WORKSHEET #6
SOURCES AND USES of FUNDS
Complete the following form to describe how much money you are seeking and how
you will use the funds raised. Be as specific as possible.

Number of funding rounds expected for full financing:

Total dollar amount being sought in this round: $

Sources of funds

Equity financing:

Preferred stock:

Common stock:

Debt financing:

Mortgage loans:

Other long-term loans:

Short-term loans:

Convertible debt:

Investment from principals:

Uses of funds

Capital expenditures:

Purchase of property:

Leasehold improvements:

Purchase of equipment/furniture:

Other:
Working capital:
Purchase of inventory:
Staff expansion:
New product line introduction:
Additional marketing activities:
Other business expansion activities:
Other:
Debt retirement:
Cash reserve:
331
How to Write and Present an Investor-Oriented Business Plan


PREPARATION AND DELIVERY OF
YOUR PRESENTATION
Preparing an Effective Presentation
An effective presentation depends on your ability to communicate with the
investor by understanding their objectives and providing a presentation that
helps them to see the opportunity for your business. The recommended ap-
proach includes the following elements.

Define your Goal
– Ask yourself, “What is the purpose of my presentation? Am I trying to
inform? Motivate? Entertain?”
– Then ask, “What do I want people to know at the end of my presenta-
tion? What do I want them to think? What do I want them to do?”
– Write out the answers to those questions and structure your presentation
around them.

Know your Audience
– A presentation has three important elements: you, the talk, and the au-
dience. The audience is the most important.
– So who is the investor? What are their concerns? Interests? How much
do they know about the subject matter?
– And, most importantly, why should the audience listen to you? What™s
in it for them?
– The more you know about the investor, the more you™ll be able to direct
your presentation to meet their needs and wants.

Focus
– Determine your core message, the main point you want the investor to
“get.” Develop at least three different ways to say it. Also identify up to
three sub-points.
– State the main point and sub-points in your introduction. “My main
point is that anyone can make a great presentation by paying close at-
tention to three elements: content, delivery, and visual aids.”
– Notice how short and to the point this statement is. Your audience
should not have to guess your main point. Make it clear from the outset.

Outline your Presentation
– In preparing your presentation, start by focusing on your goal (i.e., what
you want the audience to know, think, and do).
332 APPENDIX A


– You don™t need to do a formal outline but do write out the basic struc-
ture. The adage “tell them what you™re going to tell them, tell them, and
then tell them what you™ve told them” works well. Give people an
overview of what you™re going to present, make the presentation, and
summarize.
– Do not write out the presentation. Outline it and talk from the outline.

Have a Good Introduction
– An effective introduction gets the investor™s attention and identifies the
topic.
– Stories or questions are often good ways to start.
– After the attention-getter, state your main message and sub-messages,
and explain how the presentation will benefit the investor.

Keep the Audience™s Attention
– It is essential to hold the investor™s attention during the bulk of the pres-
entation.
– That™s challenging. Supposedly the average person thinks at the rate of
800 words per minute, and the average presenter speaks at the rate of
150 words per minute. That leaves lots of time for the mind to wander.
– To keep your investor™s attention, disrupt the flow every 10 to 15 min-
utes. How? You could:
° Change the media (e.g., show a short video).
° Invite participation.

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