**6.Moolahsense(My second campaign with Moolahsense)**

**Note*the company name will not be revealed just like the previous post as my money are still inside moolahsense, haha(this is not a sponsored post by the way)**

__Issuer summary__

**Date of listing**: NOV 2017

**Amount**:$80,000

**Tenor**:6M

**Repayment type**: Equal installment

Quoting from the moolahsense website

**Equal installmen**t:A promissory note by which an installment of the principal subscription amoung and/or interest accrued and due up to the date of payment shall be payable on such dates as set out in a repayment schedule specified in the promissory note, and on the maturity date, the principal subscription amount would have been paid in full

**Repayment term**

**:**Monthly

**Repayment term**: Will be paid monthly

**Target interest rate**:24 % P.A.

Quoting from Moolahsense website

**Target interest rate**: The maximum rate the issuer is willing to provide the interest on the principal subscription amount which the issuer wished to obtain, as notified in writing by the issue to Moolahsese

**Purpose**: Working capital

Quote from valuepenguin:https://www.valuepenguin.sg/what-is-working-capital

**Working capital**: It is a concept to describe a business ability to cover its short-term operating costs- E.g For this campaign, I have funded $500 into it(which is the amount I actually funded, which is the minimum sum that moolahsense accept for the campaign at that time)
- As the target interest rate is 24%P.A, this means that at the end of the tenor, which is 6 month(12%) I will expect to receive $560
- 100%=$500
- 12%(Interest for 6 months)=$60
- 112%(The Principal + the interest for the two years=$1000+$60=$560
- Since the tenor is 6 months, each month I will receive $93.33(inclusive of interest) in payment/equal installment
- 1month=$500/6=$93.33

__Summary company profile__- The issuer is a company incorporated in Singapore in 2006. The Issuer is in the building and construction industry and has around 10-20 employees. The Issuer specializes in the installation, servicing, and maintenance of fire prevention and protection systems as well as fireproofing materials. The Issuer is registered with the Building and Construction Authority of Singapore as a Registered Contractor for Fire Prevention & Protection Systems.

__Detail of purpose__- The Issuer seeks funding to provide working capital for existing and new contracts which have been awarded to the Issuer.

**Financial statement**Will only reveal a part of the financial statement due to confidentiality. As I have mentioned a few weeks ago in my post, that I only mainly use this three ratio: current ratio, quick ratio and debt to equity ratio to decide in investing in a campaign, hence I will be showing its ratio below

The ratio is as follow

**(left side of the column is for the year 2016/right side of the column is for the year 2015)**__Year 2016/Year 2015__

**(Current ratio 2016**:1.41),(

**Current ratio 2015**:3.53)

- A simple ratio of current asset divide by current liabilities
- Current liabilities are debt that needs to clear in the short term(in a year)
- If a company has a current ratio less then 1.0, do not invest in it
- If a company has a current ratio more then 2.0, May consider investing in it
- The higher the current ratio, the better
- For the current ratio of 2015:3.53, it is higher than the recommended range(>2.0)
- For the current ratio of 2016:1.41, it is higher than the recommended range(>2.0)

**(Quick ratio 2016**:1.41),(

**Quick ratio 2015:3.53**)

- The quick ratio is almost similar to current ratio except that it is assumed that the company does not sell its inventories(e.g Toyota inventory is its car) or stock, it is still able to fulfill its debt
- If the company has a quick ratio of 0.75 and below, do not invest in it
- If the company has a quick ratio of 1.25 and above, May consider investing in it
- The higher the quick ratio the better
- For the quick ratio of 2015:3.53, it is higher than the recommended range(>1.25)
- For the quick ratio of 2016:1.41, it is higher than the recommended range(>1.25)

**(Total liabilities/equity 2016**:1.79),(

**Total liabilities/equity 2015:0.17**)

- The debt ratio is calculated by total liabilities divided by the equity
- If the company has a debt ratio of 1.5 and above, do not invest in it
- The company should essentially have a debt ratio of 1.0, if the debt ratio is below 0.75, do consider investing in it
- The lower the debt to equity ratio the better
- For the Total liabilities/equity
- For the Total liabilities/equity of 2016:0.17, it is in the recommended range(<0.75)

__Why did I invest in this loan?__- Both the current ratio 2015(3.53), quick ratio 2015(3.53) are above the recommended ratio of >2.0 and >1.25 respectively, however, its Total liabilities/equity 2015(1.79) are out of the recommended range of <0.75.
- The current ratio 2016(1.41), quick ratio 2015(1.41) are above the recommended ratio of >2.0 and >1.25 respectively and its Total liabilities/equity 2016(0.17) is in the recommended range of <0.75, as the financial statement ratio it met all of the above-recommended ratios, I would invest in the campaign
- Furthermore,the Total liabilities/equity (2015) is 1.79 while the Total liabilities/equity (2016) is 0.17,sugggesting it is decreasing and this most probably mean that the company are paying off their liabities/debt

As this is still an ongoing campaign, below is the repayment schedule so far

link on how too read the effective interest rate for moolahsense:http://letscrowdsmarter.com/understanding-interest-rates/

Monthly interest rate:Principal/start balance=$10.00/$500=2%(Percentage conversion must *100)

Effective interest rate:2%*12=24%(Same as the target interest rate)

As you can see the status of the payment is completed, making this my first completed campaign in moolahsense, will continue with my next week post of moolahsense(my fourth campaign).

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