In order for a banker to make judgements about the future needs and prospects of an entity in deciding whether to lend money, additional detailed information in the form of future cash flows may be required.

Question

Quizplus · Accepted Answer

Future cash flows can provide insight into the ability of an entity to generate revenue and meet debt obligations, which is crucial information for a banker when evaluating the risk level of a potential loan.

In Order for a Banker to Make Judgements About the Future