There are situations in which you see a positive medium- to long-term perspective, but are currently heading for a liquidity bottleneck. In such cases, you do not need long-term financing, but interim financing.
Example 1: You want to switch your business to a business model that promises more returns or more stability. For the changeover, you need liquidity, which you do not have. However, you can plausibly demonstrate that your business is capable of servicing capital and that it will perform better in the medium term as a result of implementing the changeover. This is a classic case for interim financing.
Example 2: A company facing an acute economic crisis has developed ideas on how to overcome this crisis in the long term. In a restructuring concept with a positive going concern forecast, the company presents a comprehensible explanation of how the causes of the crisis can be eliminated. This is also a classic case for interim financing.
For interim financing, you usually need a restructuring concept with a positive going concern forecast. If you engage management consultants to prepare such an expert opinion, note that management consultants are remunerated for the expert opinion regardless of the outcome. However, they are liable for their findings. If an auditor or management consultant comes to the conclusion that the client will become sustainably profitable thanks to interim financing, and the company then fails after all, the financing credit institution initially holds the management consultant liable for his incorrect judgment. It is therefore understandable if auditors and management consultants are cautious about making positive going concern forecasts. If they are in favor of a continuation, they will include comprehensive conditions to be fulfilled for their forecast in their expert opinion.
You should provide your business advisor with any supportive information and be committed to helping them assess market and business trends so that they understand that your business will prosper, subject to interim financing.
Note that an experienced accountant or business advisor will need at least 3-4 weeks to provide such a restructuring report with positive going-concern forecast in accordance with IDW S6, and that the financing bank will then likely need an additional 2 weeks to make a credit decision, depending on the loan volume and risk.
You can obtain interim financing by extending your current account credit line agreed with your commercial bank. In principle, a deferral of trade payables can also be agreed with your suppliers. In addition, you can discuss a restructuring loan with your commercial bank. Finally, you can obtain conventional interim financing from your principal bank.