Feasibility studies: what lenders examine first
Documented assumptions, a cash-flow plan distinct from the profit and loss account, and scenarios: the points banks and funders review as a priority.
By Advisory, legal and organisation
A feasibility study is not an exercise in conviction. What a credit committee looks for is not the sponsor's optimism: it is the assumptions behind every line, and the consistency between them.
Document assumptions before figures
Every revenue line should break down into volume, price and seasonality. An analyst who cannot trace a total back to its parts treats the document as an intention, not a projection.
Write the source of each assumption in an appendix: history, order book, observed conversion. That appendix often separates an accepted file from a deferred one.
Cash timing weighs more than reported profit
A company can show a positive result and still run out of cash. The study therefore needs a cash plan separate from the income statement, using actual collection delays.
Include the rhythm of VAT, social charges and investment instalments: these are the lines that most often widen the working-capital gap.
Present three scenarios, not one
A central case, a downside case and a break case. Showing that you have identified the point where the model fails is more reassuring than a line that only goes up.
