Executive Summary
- Most CMA errors are preparation and consistency errors, not conceptual ones
- Figures inconsistent between forms is the single most common issue
- DSCR miscalculation — omitting depreciation add-back — systematically understates repayment capacity
- Every one of these is checkable and fixable before submission
The Seven Mistakes
Figures inconsistent between forms
Net profit in Form 1 that doesn't match the retained earnings movement in Form 2 is the single most common error — two forms, same underlying figure, different numbers.
DSCR computed without depreciation add-back
Using net profit alone rather than (net profit + depreciation + interest) systematically understates genuine repayment capacity and can make a bankable proposal fail the 1.25 threshold.
Intangibles included in Tangible Net Worth
Including goodwill or deferred revenue expenditure in TNW overstates apparent equity strength and understates the real TOL/TNW ratio.
Current portion of term loan misclassified
The next 12 months of term loan principal due is a current liability — leaving it in non-current understates current liabilities and inflates the current ratio.
Current asset projections reverse-engineered from desired MPBF
Building projected current assets backward from the CC limit you want, rather than forward from your actual operating cycle, produces figures a credit officer will question.
Fund Flow Statement completed as formality
A loosely prepared Form 5 that doesn't actually reconcile sources and uses coherently is immediately visible to an experienced credit officer reviewing the complete file.
CMA figures inconsistent with the DPR narrative
Projected revenue in CMA that doesn't match capacity assumptions stated in the DPR — the most obvious cross-document inconsistency a credit committee actively checks.
How to Self-Review Before Submitting
Before any CMA data file leaves your hands: verify that net profit flows correctly from Form 1 into Form 2's retained earnings; confirm DSCR uses the full three-component numerator; trace TNW explicitly excluding intangibles; reclassify the current year's term loan repayment into current liabilities; and confirm projected current assets are derivable from stated operating cycle assumptions, not from a desired MPBF number. These five checks alone catch six of the seven mistakes above.