How to Prepare a Real Estate Investor Financial Report

How to Prepare a Real Estate Investor Financial Report

If you are looking for information regarding preparing a real estate investor financial report then you just might have stumbled onto the right information. I will try to provide you with some very simplified guidelines towards preparing a financial report for your real estate investment. Whether you are a property investor or looking for investors it is equally important that you have a properly prepared financial report in order to facilitate the transaction and allow for smoother business. It is very important that you have all of your documents and paper work in order before you go out there looking for investments.

The following are some of the few simple guidelines that could help you in preparing your financial report.

1 Prepare your necessary documents. While preparing a financial report for a real estate investor it is highly important that documents like bank statements, insurance documents, I.R.A accounts, mortgage statements, tax documents, etc. are always in order. These documents are some of the essentials and must never be disregarded in any circumstance.

2 Drafting the agreements. Before approaching the actual financial report you need to draft out an agreement format in order to facilitate the preparation of the report. These types of agreements are generally made before and during investments. A Professional agreement such as this would help you to calculate further costs which are an essential part of the final financial statement.

3 Making the necessary calculations. After everything is in order the calculations can be easily made either manually or using available software packages in order to generate the complete financial report which can be distributed as softcopy or hard copies as per requirement. The report must be accompanied by the necessary documents in order to make it more substantial and relevant to the investor.

4 Circulating the report. Though this topic is not related to preparation of the actual financial report it is equally as important because without proper circulation the report will not be assessed properly and the investors will not be enticed by the effectiveness of the report.

If the above guidelines are followed very carefully and diligently it is not very difficult to prepare a financial report for real estate investors. Most of the work is easily undertaken by different available software packages and does not require human intervention. The prepared reports are highly efficient towards creating an excellent financial image for the company including its business.…

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Financial Fraud Can Happen to Anyone

Financial Fraud Can Happen to Anyone

In 2008 it was discovered that Bernard Madoff, famed financial investor, had scammed clients out of approximately $65 billion over 20 years. His victims included people from all walks of life–from politics, to Hollywood luminaries.

The list even includes Holocaust survivor Elie Wiesel and his Foundation for Humanity. Madoff stole from many in his Jewish community, not all of them wealthy.

He fooled investors, big and small, with claims of exclusivity and consistently positive returns. A year later in 2009, a seemingly endless string of similar scams began to surface.

Although the most sensationalized scandals were large-scale, many scams also occurred in small communities across America. They may not have made the papers, but these small scale con artists still cheated their victims out of every last penny.

No matter what regulators may devise, there will always be con artists on both big and small scales. They have existed long before Charles Ponzi’s famous swindle in 1920, and will no doubt continue to fool investors in the future.

The amount of financial scams uncovered in 2008 and 2009 were hardly unusual. While bear markets and recessions reveal scams, they do not cause scams.

Madoff was lying to his investors for decades–the recession of 2008 simply exposed his practices, because he could not continue any longer. If fraudsters manage to avoid detection long enough to get enough money from their victims, market volatility will eventually unmask their fraud.

Normal market volatility is just that–normal. Although many may feel they have been cheated in periods of big volatility because the market put a dent in their portfolios, there is a big difference between normal market volatility and thievery.

Financial fraud can happen to anyone. It is critical for investors to follow five rules to avoid financial fraud:

  • Avoid giving full asset control to a financial adviser.
  • Watch out for returns that are too good to be true.
  • Do not be blinded by fancy tactics or flashy investment strategies.
  • Do not be distracted by exclusivity, benefits, and other things that do not impact results.
  • Always exercise due diligence and research firms before handing over any sum of money.
  • Use them as a checklist to avoid financial fraud of all kinds, and at all levels.

The first and most important sign of financial fraud is a money manager or financial adviser who also takes custody of their client’s assets. In other words, the financial adviser also acts as the bank or broker–supposedly safekeeping the assets that they manage.

Most cases of embezzlement have this sign of financial fraud in common. In these instances, clients did not deposit their money with a third party.

Instead, they decided to deposit their money directly with the decision making party, giving their adviser full responsibility not only to decide which stocks to buy, but also to keep and account for the client’s assets. In taking full control of client’s funds, the money manager has the ability to spend the client’s money in any way they see fit, and …

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Phantom Commercial Loans

Phantom Commercial Loans

The description of phantom commercial loans was inspired by earlier terminology related to phantom software or similar phrases which generally referred to high tech companies announcing that they were planning to issue new products at some vague point in the future. The usual motivation was to discourage consumers from buying a competitive product because the manufacturer would usually suggest that their yet to be released product would surpass an existing item in one or more ways. Because such a large percentage of these announcements were often not followed by the actual sale of software, the product which was announced with such fanfare but never ultimately made available for sale became known in many circles as phantom software because the intended use of the definition suggests something that only appears to be real.

Sadly a similar event is now occurring more frequently with respect to business financing and working capital finance. Lenders which either do not have sufficient funds for routine lending purposes or which do not really have a serious interest in actively providing commercial loans are nevertheless making announcements about the availability of their financial services for small businesses.

While it is hoped that this trend will not continue, it is simply too early to provide a confident prediction as to how this will unfold over the next year or so. Because borrowers should always have the most accurate information for any potential loan transactions, it is suggested that they take some extra precautions to ensure that any banking representations are fully examined and confirmed for accuracy before proceeding in attempts to secure working capital.…

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Need For Venture Capital Stable in Questionable Economy

Need For Venture Capital Stable in Questionable Economy

The declining economic trend continues. An old axiom in business says that the best time to start a business is during an economic crisis, but all indications show a similar downward trend in available venture capital.

It seems that most venture capital groups sit with cash, overcoming the uncertainties that dominate the economy. Not because the money isn’t there; the group just doesn’t want to take the risk now. Why is that?

The aim of most new companies is to make it an IPO or be acquired by another company. The failure rate in starting a business is very worrying. With rising fuel costs an increase in the costs of all other things, including capital equipment, labor and supplies, as well as construction and real estate. Companies that will not invest in their own businesses will most likely not acquire other companies. With the high costs associated with starting a business, people rely on initial profits to fund their new business.

Unfortunately, these businesses that open with little money do not survive. Consumers will not spend money today, competition is high, and the cost is too expensive to promote and advertise new business.

How Venture Capital Helps Small Businesses Become Big Businesses

The entry of money in the initial phase of start-up helps businesses to acquire equipment, real estate, and other things that are not related to day-to-day business operations. This type of investment helps businesses to grow very quickly. Usually.

In this economy, consumer confidence is low. People sit with cash reserves and don’t buy new products … from small appliances to cars, they either fix what they have or do without. The service industry was also hit. More consumers choose to do it themselves than hiring a company.

Venture capital allows beginners to buy the equipment and inventory needed to grow quickly and start making money faster than they should. This allows new companies to promote and reinvest, attract new and growing customers without turning the wheel by making money just to immediately buy something that is needed.

Helping the economy

The importance of venture capital now is that many companies that have been successful in the past year no longer make money. They are trapped in neutral conditions and do not produce significant benefits. Outdated equipment. Improvements needed for constant business infrastructure. They need to compete to survive and to do that, they must improve their situation.

This is not trickle down or trickle up theory; it is a tricky theory. The business of buying equipment to make money by attracting more customers and keeping people working builds things that other companies need to supply the company … You get the picture.

This is an economic network. That’s one thing that needs to be successful for our economic system to succeed. Even the United States Government is involved with offering money to certain industries. Say what you want, no matter your politics, but the Federal government is the largest venture capital provider in the country. Usually, venture …

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Green Business Equals Danger For Greenhorn Investors

Green Business Equals Danger For Greenhorn Investors

I am not suggesting for a moment that all Green businesses are bad investments, but I am suggesting that whenever a bubble appears or to there is much enthusiasm for an idea, that a number of the businesses ideas sold to unquestioning investors will turn out to serve the middle men far more than the money men.

As the investors, the business angels, we need to be on our guard.

There appear to be two dangers with the current alternative or green energy fad.

The first is the classic investment risk taught by Benjamin Graham and discussed in his book The Intelligent Investor. Graham, the mentor of Warren Buffett, took apart the reasons for investing in the 1950s boom industry – the airlines.

His analysis has been proven to be right as Buffett now claims that in 50 years, airline investors taken as a whole still have not had a return on their money.

However, Graham did spot that a large number of companies supplying the new industry did make a lot of money for investors. Airports, retailers and caterers have done well.

Graham’s conclusion was that it is far better to supply a growth business sector than to be a part of a great swam of investment as inevitably too much money will be invested too easily squeezing the profit margins of good ideas.

The second risk is that climate change will turn out to be a Malthusian idea that solves itself as population growth, mutually assured destruction and other apocalyptic scenarios usually do.

This is illustrated by the increasingly skeptical scientific community which is beginning to raise its head against the slavish commitment to all forms of greenery.

I and my fellow investors are not scientists, but it is worth noting their scientific concerns as it could up-end a few business models and a lot of start up ideas.

Firstly, there is a generally held view by the (admittedly few) academics that I know that if a scientist wishes to receive funding for research he is well advised to research ‘the affects of climate change’ and that research into ‘climate change – the myth’ isn’t currently being funded. By making the assumption that climate change is real, researching get money, if not then not.

Therefore, the scientific literature being published is already biased by the incentives of the research grant process and therefore, can needs to be viewed as biased in favour of climate change. The latest report from the IEA (International Energy Agency which made the front page of the Financial Times) might be a good example as it take it as proven that global temperatures are rising).

Next, dissent is beginning to break out in normally green magazines such as the UK’s Big Issue (sold on the streets by UK homeless) as well as larger circulation magazines such as The Economist.

In fact, a recent letter to the Economist by Horst-Joachim Luedecke, retired professor of physics, Heidelberg set out three reasons to be skeptical of green …

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