Obtain Better Loan Rates - Utilize Outside Accountants

It makes intrinsic sense (and deal practitioners have long sensed) that borrowers with audited financial statements tend to get better terms in loan deals. Now, a Chicago Booth study discussed in the Wall Street Journal has shown that, on average, audited businesses pay more than half a percentage point below the interest rates paid by non-audited businesses. This study was based on data from more than 10,000 closely held companies, about half of which had less than 500 employees.

However, this advice is not one-size-fits-all.  Depending upon the size of the loan, some banks may provide the same favorable terms with a lower level of review, such as a compilation or a review by an outside accountant.  If you have a pre-existing relationship with a bank, it may be worth a call to see if the bank may provide better terms if your business obtains a review by an outside accountant.

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