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| Tax return can be reconciled with the balance sheet to come up with an accrual based income. Also, family living expenses can be figured from tax return and balance sheet. Tax return can also show some other details the lender might be interested in. Gambling revenues. Especially scary if there is equal offsetting losses. Hedge account income/losses (might show excessive speculation). New equipment purchases. Etc.
Other things a lender might look at on a tax return. Actual expense vs cash flow projections. Fertilizer (are you mining the soil). Possible future tax liabilities (nothing on depreciation schedule, but lots of money borrowed against equipment could cause a cash flow problem).
Lots of info to be gleaned form the tax returns.
Brandon
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annual visit to the lender
