Write short notes on Importance of search/status report.

Answer 5(b)(ii) Importance of search /status report The scope of a search report depends upon the requirements of the Bank or Financial Institution concerned. A search report enables the Bank/Financial Institution to evaluate the extent up to which the company has already borrowed money and created charges on the security of its movable and/or immovable properties. This information is vital for considering the company's request for grant of loans and other credit facilities. The Bank/Financial Institution, while assessing the company's need for funds, can take a conscious decision regarding the quantum of loan/credit facility to be sanctioned, sufficiency of security required and its nature, as also other terms and conditions to be stipulated. The search report, thus, acts as an important source of information enabling the lending Bank/Institution to take an informed and speedy decision, and it also assures about the credit-worthiness or otherwise of the borrowing company.