Financial Plan: practical guides and steps

A financial plan turns a business project into figures before launch. In Belgium, the law requires one from the founders of several types of company. This page helps founders understand this document, build it and use it well.

A mandatory financial plan for certain companies

The law targets three company forms. The Code of Companies and Associations requires it for an SRL, an SA or a cooperative company. The founders hand it to the notary before incorporation. The notary keeps it on file without publishing it. Above all, the financial plan justifies the amount of initial equity.

The law also sets its minimum content. Here are the expected elements.

• A precise description of the planned activity.
• An overview of all sources of funding.
• An opening balance sheet and projected balance sheets after twelve and twenty-four months.
• A projected income statement over the same periods.
• A budget of income and expenses covering at least two years.
• A description of the assumptions used.

The financial plan must also stay consistent with the articles of association. You can read the Code on the Belgian Official Gazette website. For a detailed method, read our article on the mandatory financial plan for SRLs and SAs.

Why this document binds the founders

The financial plan does more than get you past the notary. If bankruptcy occurs within three years, the court may examine the financial plan. If initial equity was manifestly insufficient, the founders may then have to cover part of the debts. A serious financial plan therefore also protects those who sign it.

This stage belongs to a wider journey. To place it in context, follow the path to starting a business in Belgium.

Financial plan, project file and forecast

These three concepts overlap without being identical. The project file tells the story: offer, market, strategy and team. The financial plan translates that story into figures to meet the law. The forecast mainly serves day-to-day management and talks with the bank.

In practice, the same work feeds all three documents. Our article on structuring the project file and its requirements shows how to link it with the financial plan. For the figures, our complete forecasting method covers each table. In France, an international student who starts a business must also prove viability. In that case, see the role of the project file in a change of status.

Common mistakes and good practice

The same weaknesses often appear in a financial plan. Here are the most frequent ones.

• Revenue stated without an explicit price or volume.
• Forgotten costs, such as insurance or social contributions.
• No salary at all for the manager.
• Confusion between profit and available cash.
• A generic template copied without adjustment.

Instead, start from your assumptions and check that they stay consistent across tables. Then have an accountant review the financial plan. Moreover, a tool like Juristelo automatically links assumptions, profit and cash flow. You can thus test your financial plan against a slower start before signing the articles.