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Check your Checklists: update and clearly communicate

[This post is part of a series on business…for business owner/managers and their lenders.]

One of the great things about the ten essentials of hiking or the twenty essentials of sea kayaking is how easy it is to check. You can do it before each trip. And pretty soon it becomes routine.
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What checklists are essential in your business?

For the consulting I do for banks and credit unions on financial analysis, I have created an “Income Analysis and Documentation Checklist”. It lists 25 types of income, the documentation commonly required and what the lender needs to do if s/he wants to use it in qualifying income for the loan.

Both business and personal income sources are included since a personal analysis and personal guarantee is required for business loans to small or medium size businesses.

I encourage my lending institution clients to review the Excel-based checklist, consider the guideline recommendations and if they need to be modified for current conditions, modify the checklist based on those decisions, and then post it to their network and get it out to all of the lenders and business development officers.

Then we use those recently updated and specific guidelines in the tax return analysis training to get everyone on the same page.

Guidelines, policies, procedures and the like only work if they are clear, and clearly communicated. (If you are a business owner and would like a copy of my ‘eChecklist’ so you can see what the lenders are looking for please email me at

Have you updated them lately?

I was talking to the Chief Lending Officer of one of the ten largest Credit Unions in the country. I suggested that the checklist would help consistency since they have been adding lending staff.

He countered that it had been far too long since he revisited their specific documentation guidelines, especially in the light of current economic conditions. Is it time to take a look at yours?

The first essential for business

Clearly communicated policies, guidelines and procedures are so critical that I am picking this one for my first of the Ten Essentials for Business.

What would you like to nominate for the list?

About the Author
Linda Keith CPA is an expert in credit risk readiness and credit analysis. She trains banks and credit unions throughout the United States, both in-house and in open-enrollment sessions, on Tax Return and Financial Statement Analysis. She is in the trenches with lenders, analysts and underwriters helping them say "yes" to good loans. Creator of the Tax Return Analysis Virtual Classroom at, she speaks at banking associations on risk management, lending and director finance topics.