This book explains how and why planning is conceived and implemented. The steps lead to convincing prospective owners that investments will be recovered profitably, and when correctly implement to convince lenders that loans will be repaid. It examines the basic nuts-&-bolts for putting a business plan together & lists components to consider to assemble them into a solid plan. It explains the most common methods of measuring profitability & points out uses & misuses of each profitability measure. EQUITY - " Planning and Financing" depicts the basic nuts and bolts for putting a business plan together. It lists the components to consider and shows how to assemble them into a plan. It explains in detail the most common methods of measuring the profitability of a plan, and points out the uses and misuses of each profitability measure. Because planning involves forecasting and because the future is never what it used to be, a plan must include a range of possible variations from its basic assumptions. Because a change in one variable can lead to alterations in related other assumptions, the book introduces THE STRATEGIC PLANING GRAPH. This is a multi Y-axes graph. Each Y-axis represents a range of possible values for a given assumption. Such GRAPH permits to make changes in many assumptions simultaneously on the set of Y-axes and then read the resulting outcome on the X-axis, using the preferred profitability curve. The GRAPH can be used to optimize a plan, target a desired profitability or value a going concern based on a favored profitability measure. This GRAPH allows the manager to shape the plan without further interference from accountants, economists or computer technicians. The manager does not need to know or learn accounting, he just needs to steer accountants into producing such GRAPH. The making and use of THE STRATEGIC PLANNING GRAPH are explained in the book. LOANS - " Planning and Financing" shows the most common loan formats and their loan repayment methods. The interest cost for each format is demonstrated and compared in tables and figures. The use of each loan format is explained, not only by demonstrating how different repayment schedules fit into the projected cash flows, but also by showing how it can influence the rate of return on Equity. The book gives details about what is to be included in a proposed financing document, and also lists sources of borrowing and of collateral. The STRATEGIC PLANNING GRAPH can also show how the projected loan(s) fit into the cash flow of the venture or can be made to fit as required. INFLATION - " Planning and Financing" explains how to build a plan that allows to survive with inflation. It explains the relationship between the lifetime of an asset, the inflation rate and the percentage of the asset price to be borrowed. An algebraic formula expresses this relationship and an accompanying figure allows one to apply the formula without using mathematics. FORMAT - The book is designed to fill the gap that presently exists between technical education curricula and those of accounting and finance. Planning and Financing is structured so that 10 lessons cover the nuts and bolts of planning and financing for people that had little or no prior exposure to the subject as well as for advanced students of the subject. A last chapter relates actual unexpected experiences anyone may encounter in the real world of planning and financing. The 11 Chapters include: 17 Figures in color, created with Microsoft Excel, 14 Strategic Planning Graphs in color, created with the Graph program, 44 Tables, 22 Samples to illustrate the theories, Several Algebraic Formulae, The book includes suggestions for formatting. long term financial forecasts and tabulated multiple revisions of assumptions.
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Electronic & Database Publishing, Inc.
August 20, 2006
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