Financial statement spreading
Compare the statements without losing the detail that explains them.
SpreadSpaceâ„¢ organizes supported financial statements into a review of earnings, liquidity and repayment capacity. Compare reporting periods, inspect source-backed figures and bring supporting schedules into the discussion.
Work with balance sheets, profit and loss statements and cash flow statements, alongside supported aging reports, debt schedules and personal financial statements.
Build a view that keeps its context
A comparison is only useful when the reviewer understands what is being compared. Keep the company, reporting period and source document attached to the financial information.
SpreadSpace brings the statements into an organized analysis so the reviewer can examine performance across the supplied periods and then return to the supporting evidence. A chart can show the change; the source helps explain it.
Every line the statement prints is kept under its own heading, from current assets through equity on the balance sheet, from revenue through net income on the profit and loss, and through the operating, investing and financing activities, the beginning and ending cash and the supplemental disclosures on the cash flow statement. A standardized line name sits beside the name the company printed, so the same account lines up across periods and across companies, and a statement presented in thousands or millions keeps its stated scale. Margins and EBITDA per the statements follow from those printed figures.
Public filings and private statements
Audited, reviewed, compiled and management-prepared statements enter the same review as a 10-K or 10-Q. A public filing is read as it was published, from the HTML, the PDF or the Excel financial report, with the primary statements and the notes behind them.
The notes tables are read as tables of their own. Debt maturities, lease obligations, the income tax provision and the rollforwards of equity, allowances and intangibles each keep their figures, so a total on the balance sheet can be followed into the note that itemizes it.
Public and private statements keep their own company, period and source. A comparison across them is the analyst's call, made with both documents in view.
Read the components behind the total
A current-assets figure may combine cash, receivables, inventory and other amounts. Those components are not interchangeable simply because they appear under the same heading.
Use source review and available component detail to examine what supports a total. The same approach applies when a liability amount needs to be understood before it is used in an assessment of repayment capacity.
For supported derived figures, inspect the contributing rows rather than treating the summarized amount as self-explanatory.
Connect working capital to the schedules
Bring accounts receivable and accounts payable aging reports alongside the financial statements. Review the supplied balances and aging detail when investigating the company's working-capital position.
The report is read in the aging ranges the company printed, including custom periods and retainage, with one row per customer or vendor and the printed totals standing beside the rows added up. A detail aging keeps one row per open invoice or bill, with its number, dates, days past due and balance. Intercompany names, concentration in a few customers or vendors and the movement of the aging from one report date to the next are each available to the review.
For example, a higher receivables balance invites a different conversation when the supporting report shows that more of the balance is overdue. The point of connecting the schedule is to let the analyst examine that question, not to substitute an automatic conclusion for the review.
Keep the reporting dates in view when comparing a schedule with the statement it is being used to explain.
Read the debt schedule and the personal financial statement
A debt schedule is read in the borrower's own column layout, one row per creditor. Each row keeps the original amount and date, the current balance, the interest rate, the maturity date, the payment amount and frequency, the collateral and whether the obligation is current or delinquent. Account numbers are kept to their last four digits. The balances are added up beside the printed total, and SBA Form 2202 is read the same way.
A personal financial statement on SBA Form 413, or on a lender's own form, keeps the assets, liabilities and net worth, the sources of income and the contingent liabilities. The schedules behind them are read as well, so the notes payable to banks and others, the stocks and bonds, each property of real estate owned and the life insurance are available when the guarantor's position is part of the review.
Examine changes across the periods provided
Compare revenue, expenses, earnings and balance-sheet movements. Use available monthly detail to investigate changes that a year-end comparison may leave unexplained.
An increase or decrease is a starting point for questions. Is the comparison over equivalent periods? What contributes to the movement? Does another document provide context? The workspace keeps the financial view and source review connected while the analyst works through those questions.
Bring earnings and obligations into coverage analysis
Review the selected earnings basis, analyst adjustments and debt service together. Compare a historical view with a pro forma view that includes proposed debt, keeping the assumptions available for the discussion.
A coverage figure should be explainable through the inputs used to calculate it. The analyst determines which supported inputs and adjustments belong in the loan's analysis.
Check the mathematics without hiding exceptions
For supported documents, SpreadSpace checks extracted figures against the mathematical relationships available in the document. An extraction that does not meet validation requirements is rejected. A retained extraction with a discrepancy includes an explicit notice for review.
Passing an arithmetic check does not establish the quality of the borrower's financial reporting or resolve every question in the credit file. Use it alongside the source and the analyst's review.
Turn the analysis into a reviewable explanation
Bring selected financial exhibits into the credit memo and write the explanation around the analysis. In the workspace, source-linked figures remain available when a reviewer wants to inspect the supporting detail.
The benefit is not simply another summary. It is a path from the summary to the information needed to understand it.
See what supports the spread
Bring a statement package and its supporting schedules. Review a material change, inspect the components behind a total and follow the evidence into the credit memo.