Allen Wine Group offers winery collateral audits for our banking partners. This service provides a comprehensive evaluation and measurement of the asset collateral and risk for winery loans, empowering our partners to make informed decisions and manage their risks effectively.
Our years of experience in the wine industry prove invaluable in understanding the complexities associated with lending. With our expertise, we deliver a detailed and insightful analysis of a winery’s collateral value before loan extensions. This analysis is essential for lenders to assess other financing options that they may authorize. We understand collateral risks in asset-based lending and recognize that lenders need to know that wineries have sufficient collateral to cover outstanding borrowings.
This article covers the basics of winery collateral audits and highlights their importance. It also showcases the expertise of our accounting services firm in providing these essential services within an industry that is thriving in both product and profit growth.
What Is a Winery Collateral Audit?
A winery collateral audit comprehensively evaluates the winery’s assets and value, providing lenders with a clear understanding of the loan amount they can safely issue the business. This audit rigorously tests the accounts receivable and inventory, and also includes assessing overall business processes such as sales cut-off and discounts accounting.
Lenders gain insight into the winery’s overall financial health by conducting a thorough collateral audit. This information informs their decision-making regarding moving forward with financing. Ultimately, the collateral audit is a critical tool that helps lenders manage their risk and ensure that loans are appropriately secured.
The Competitive Advantages of Working with Allen Wine Group
The advantages of working with the Allen Wine Group, the advantages are clear. Our team of professionals has extensive accounting experience at the highest level of the industry. We have a wealth of experience working at wineries in Napa and Sonoma, and serving as auditors at prestigious CPA firms like Deloitte, and Moss Adams and Dal Poggetto. This expertise ensures that our clients recieve the highest quality service.
This wealth of knowledge provides valuable insights to clients and helps them understand the industry’s intricacies. We regularly prepare borrowing base certificates for clients, giving them a thorough understanding of how they work and what they measure.
Efficient & Effective Risk-Based Approach to Collateral Audits
Managing risk is an essential component of any successful business. Our efficient and effective risk-based approach to collateral audits, which ensures that potential hazards are identified and addressed before they can become serious problems, providing our banking partners with a secure risk management strategy.
One critical element of this process is paying close attention to the details of borrowing base certifications, particularly the net FOB value of assets. Too often, these certifications need to consider discounts or depletion allowances, leaving them vulnerable to potential shortfalls.
Establishing precise shipment cut-off points is vital to ensuring the accuracy of all sale records. This practice also supports the timely recognition of revenue and protecting it from being recorded prematurely.
Finally, carefully tracking and managing DTC inventories are essential to mitigating risk and preventing inventory-related complications from disrupting operations. Whether managing physical counts or futures, it is crucial to take a careful and comprehensive approach to collateral audits to protect any business’s long-term viability and success.
Ready to Schedule an Audit?
At Allen Wine Group, we proudly provide comprehensive audits to help wineries secure more favorable loan terms and protect their assets. We understand that our banking partners play a crucial role in this process, and our thorough and accurate audit processes gives them the confidence they need to make wise decisions when assessing winery loans.
Our service team members have over 250 collective years of industry experience, efficiently and effectively identifying winery-specific uncertainty. Collateral examinations include recurring field observations, and collateral monitoring or valuation, such as physical counts, discounts and depletion consideration, and proper cut-off of receivables and shipments.
If you would like to schedule a consultation with our team to discuss the audit process, please contact Tim Allen at Allen Wine Group.
