If you’re a business owner, it’s likely you’re going to have debt on your books. That debt could be from loans, leases, or contracts. It’s important you make sure you have access to all the information pertaining to those debts, and having a business debt schedule is important for doing so.

There are many GREAT reasons for listing your debts out. For one, it’s important to make all of your payments on time, and if you neglect to do so it can have a negative effect on your credit – both personally, and business credit. By having all of your debts listed in one place, it allows you make a strategic moves when it comes to managing your debt and especially if you plan on taking on new business loans. Potential investors will want this information. If you maintain an up-to-date business debt schedule, it’s the best way to show your business is properly operating and so you can convey the information to the necessary lenders you’re planning on working with.

What is a business debt schedule?

The purpose of a business debt schedule is to let you collect, review, and then analyze your overall business debts. The purpose of this is to help you be strategic with your decision making process when it comes to business’ obligations. Using the information you gather from this, you can create a plan on how, and when, to pay off certain debts and whether you are in a position to acquire new debts. You’ll also be able to use the information in the business debt schedule to create long term projections. Businesses often use a business debt schedule to create a cash flow analysis.

Types of debt found on a debt schedule

All business related debt should be included on the schedule. That means loans, leases, contracts, notes that are payable, and anything else you are contractually obligated to pay. If there are any expenses, such as accounts payable, etc, they should not be be included.

What’s included on a debt schedule?

The debt should should include every detail of every debt, so that anyone can look at it and be able to assess all the variables of your debt. Typically, a business debt schedule will have information like:

  • Creditors name
  • Origination date of debt
  • Original debt amount
  • Current balance
  • Interest rate
  • Monthly payment of debt
  • Security, or collateral, if any
  • Maturity date of the debt

Why businesses need a debt schedule

Businesses need to keep a debt schedule in order to manage the financial of their business. This tool gives you a birds-eye view of all of your debts, and let’s you analyze your payments and future obligations. It’s important to keep, because people like accountants, prospective lenders, or someone whose going to buy your business – could ask for it, or the information contained in it. There’s a variety of benefits to keeping a debt schedule that can benefit your business, for example:

Stay current: If you maintain a good debt schedule, it’ll help you remain organized. There’s nothing worse than paying your debts late, or forgetting to pay them all together. The business debt schedule let’s you see all of that.

Keep your books accurate: Bookkeeping is complicated when you multiple debts. Having all of the information regarding your debts at your fingertips is great.

Forecast: Putting all of your debts in one place let’s you quickly see how much you owe every month. It can be a good

Strategize: Debt schedules let’s you strategically organize your debts so you can make sure you’re paying off your debts early where needed. You can assess which of your debts to pay off first. Moreover, knowing whether you can afford to borrow more depending on knowing how much you already owe and are due to pay every month. The debt schedule is a key part of knowing your companies overall financial health. If the totals of the balances and monthly payments are too large, you’ll be able to see immediately through the debt schedule.

Bottom line

Debt schedules are VERY useful, but only if they’re kept up to date with your current information. You should make sure to refresh the information on the business debt schedule as often as possible.

 

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