What a lender will ask you for

Somewhere between the first conversation and the credit decision, someone sends you a list. It usually arrives as a bare set of bullet points with no explanation of why any of it is wanted, and the speed with which you can answer it is one of the few parts of a finance application entirely within your control.

It is also not one list. What gets asked scales with two things: how long the business has been trading, and how much you are asking for.

If you have traded two years or more

• Three years of financial statements. Two is sometimes accepted, three is what gets asked for.
• Two years of tax returns, for the business and often for the directors.
• Your latest management accounts, if more than six months have passed since the last full financials. This one catches people out, because it is the document least likely to already exist.
• Six months of bank statements, for every trading account.
• Twelve months of BAS lodgements.

If you have traded less than two years

The list changes shape rather than getting shorter. With less history to read, a lender leans harder on what is current and on you personally.

• Everything you have, financially, however partial.
• Twelve months of bank statements rather than six.
• An aged debtors and creditors listing, which tells a credit team more about a young business than a profit figure does.
• Forward projections, with the assumptions behind them written down rather than implied.
• Personal financial statements for directors and any guarantor.

For facilities above about $250,000, expect a preference for reviewed or audited statements rather than compiled ones. It is not always insisted on, and it is always noticed.

Why the same figure is worth more from one source than another

Not all financial information carries equal weight, and understanding the order explains most of what a lender asks for and why.

This is why bank statements and BAS lodgements get asked for even when full financials exist. They are not duplicates. They are the independent check: revenue that reconciles across your accounts, your bank and your lodgements is close to bankable fact, and revenue that only appears in one of the three gets discounted.

What actually slows an application down

In practice it is almost never the big documents. Financials and tax returns exist and your accountant can send them the same day. What holds files up is the small stuff.

• Management accounts that have not been prepared since the last year end, which is common and takes a fortnight to fix at the worst possible moment.
• A trading account nobody mentioned, which surfaces halfway through and restarts the reconciliation.
• BAS lodgements that are behind. This is worth checking before anything else, because it is both a delay and a signal.
• Debtor and creditor listings that have to be built by hand because the ledger has not been reconciled.
• Guarantor information that requires a conversation with a spouse nobody has had yet.

Getting ahead of it is genuinely worth something

A credit team forms a view of a business partly from how the business presents. Two identical files, one arriving complete and reconciled and the other arriving in six emails over three weeks with a correction in the middle, do not read the same way, and the second one attracts questions the first never gets asked.

It also protects you from a specific and avoidable outcome. Applications that stall because information is missing sometimes get withdrawn and resubmitted, and a decline that lands on a file for administrative reasons sits there exactly as long as one that lands on merit.

None of that requires anything clever. Pull the list together before you need it, reconcile the three sources against each other, and find out what does not agree while there is still time to explain it.