BPM Financial Modelling

Financial Statements Modelling Exercise

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Primary Model Developer: BPM Financial Modelling Cover Notes: Provides a practical example of the modelling of live, three-way financial statements.

Table of Contents
Financial Statements Modelling Exercise
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Section & Sheet Titles 1. Assumptions

a. Time Series Assumptions b. Opening Balance Sheet Assumptions c. Projected Assumptions

Page 3
4 6 7

2. Financial Statements
a. Income Statement b. Balance Sheet c. Cash Flow Statement

8
9 10 11

3. Appendices
3.1. Lookup Tables
a. Time Series Lookup Tables

12
13
14

3.2. Checks
a. Checks - Error Checks - Sensitivity Checks - Alert Checks

17
18 20

Total Pages:

Assumptions
Section 1.
Financial Statements Modelling Exercise
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Section Cover Notes: This section contains assumptions relating to the forecasting of financial statement items. Assumptions are contained within the Time Series worksheet, Opening Balance Sheet worksheet and the Project Assumptions worksheet.

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Time Series Assumptions

Financial Statements Modelling Exercise
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x h O Time Series Assumptions

Core Time Series Assumptions
Title Periodicity Financial Year End Start Date Periods Denomination 31 1-Jan-12 5 2 Primary Annual 12

Historical & Forecast Period Titles

Include in Period Titles? Actual Periods Budget Periods TRUE 3 -

Data & Projections - Timing Assumptions

Data Term Basis Data - Active Periods Projections - Start Date 1 3 1-Jan-13

Notes: - A Financial Year End assumption of 28th of February is assumed to be a month end financial year end, even in a leap year. - The "Model Denomination" assumption will not necessarily automatically change the denomination of the outputs of this model. - A "Budget Period" refers to either a period in the current financial year or periods containing combined actual and forecast data. - "Data & Projections - Timing Assumptions" are used as the basis for related data and projections time series sheets. - Use the bpmToolbox "Update Time Series Columns" tool to hide inactive data and projections time series periods.

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Opening Balance Sheet Assumptions

Financial Statements Modelling Exercise
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Opening Balance Sheet ($Millions)

Current Assets
Cash Accounts Receivable Other Current Assets Total Current Assets 1-Jan-12 50.0 10.0 5.0 65.0

Non-Current Assets
PP&E Intangibles Deferred Tax Assets Other Non-Current Assets Total Non-Current Assets 250.0 100.0 5.0 12.0 367.0 432.0

Total Assets Current Liabilities

Accounts Payable Interest Payable Dividends Payable Income Tax Payable Other Current Liabilities Total Current Liabilities

8.0 2.0 1.0 6.0 2.0 19.0

Non-Current Liabilities
Debt Deferred Tax Liabilities Other Non-Current Liabilities Total Non-Current Liabilities 196.0 12.0 6.0 214.0

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Projected Assumptions
Financial Statements Modelling Exercise
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Year Ending 31 December 2012 (A) 2013 (A) 2014 (A) 2015 (F) 2016 (F)

Revenues & Expenses

Sales Cost of Goods Sold $Millions % of Sales Base Period Periodic Growth Rates (% per Year) 120.0 5.0% 3.0% 2.5% 45.0% 45.0% 45.0% 45.0% 2.5% 45.0%

Operating Expenditure Capital Expenditure - PP&E Capital Expenditure - Intangibles

$Millions $Millions $Millions

Base Period Periodic Growth Rates (% per Year) 27.0 2.5% 2.5% 2.5% 7.0 1.0 7.5 1.3 8.0 1.5 8.5 1.8

2.5% 9.0 2.0

Debtors & Creditors

Accounts Receivable Accounts Payable Debtor Days Creditor Days 30 60 30 60 30 60 30 60 30 60

Assets
Depreciation & Amortisation Assumptions
Depreciation - PP&E Depreciation - Intangibles % of Capex % of Capex 90.0% 95.0% 90.0% 95.0% 90.0% 95.0% 90.0% 95.0% 90.0% 95.0%

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Financial Statements
Section 2.
Financial Statements Modelling Exercise
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Section Cover Notes: Contains live, linked three-way financial statements (Income Statement, Balance Sheet & Cash Flow Statement).

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Income Statement
Financial Statements Modelling Exercise
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Year Ending 31 December 2012 (A) 2013 (A) 2014 (A) 2015 (F) 2016 (F)

Income Statement ($Millions)

Sales Cost of Goods Sold Gross Margin Operating Expenditure EBITDA Depreciation - PP&E Depreciation - Intangibles Total Depreciation & Amortisation EBIT Interest Expense Net Profit Before Tax (NPBT) Tax Expense Net Profit After Tax (NPAT) 120.0 (54.0) 66.0 (27.0) 39.0 (6.3) (1.0) (7.3) 31.8 (15.9) 15.8 (4.7) 11.1 126.0 (56.7) 69.3 (27.7) 41.6 (6.8) (1.2) (7.9) 33.7 (16.2) 17.5 (5.3) 12.3 129.8 (58.4) 71.4 (28.4) 43.0 (7.2) (1.4) (8.6) 34.4 (16.4) 18.0 (5.4) 12.6 133.0 (59.9) 73.2 (29.1) 44.1 (7.7) (1.7) (9.3) 34.8 (16.6) 18.1 (5.4) 12.7 136.4 (61.4) 75.0 (29.8) 45.2 (8.1) (1.9) (10.0) 35.2 (16.9) 18.3 (5.5) 12.8

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Balance Sheet
Financial Statements Modelling Exercise
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Year Ending 31 December 2012 (A) 2013 (A) 2014 (A) 2015 (F) 2016 (F)

Balance Sheet ($Millions)

Current Assets Opening Cash Net Change in Cash Held Cash Accounts Receivable Other Current Assets Total Current Assets Non-Current Assets PP&E Intangibles Deferred Tax Assets Other Non-Current Assets Total Non-Current Assets Total Assets Current Liabilities Accounts Payable Interest Payable 4.4 15.9 4.5 16.2 4.7 16.4 4.8 16.6 4.9 16.9 250.7 100.1 5 12.0 367.8 454.6 251.5 100.1 5 12.0 368.6 466.0 252.3 100.2 5 12.0 369.4 475.3 253.1 100.3 5 12.0 370.4 481.2 254.0 100.4 5 12.0 371.4 491.7 50.0 26.0 76.0 9.8 1.0 86.8 76.0 9.1 85.1 10.4 2.0 97.4 85.1 7.1 92.2 10.7 3.0 105.8 92.2 5.8 97.9 10.9 2.0 110.9 97.9 9.7 107.6 11.2 1.5 120.3

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Cash Flow Statement

Financial Statements Modelling Exercise
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Year Ending 31 December 2012 (A) 2013 (A) 2014 (A) 2015 (F) 2016 (F)

Cash Flow Statement ($Millions)

Operating Cash Flows
Sales Decrease in Accounts Receivable Cash Receipts Cost of Goods Sold Operating Expenditure Increase in Accounts Payable Cash Payments Interest Paid Tax Paid Decrease / (Increase) in Other Current Assets Increase / (Decrease) in Other Current Liabilities Net Operating Cash Flows 120.0 0.2 120.2 (54.0) (27.0) (3.6) (84.6) (2.0) (4.6) 4.0 (1.5) 31.5 126.0 (0.5) 125.5 (56.7) (27.7) 0.1 (84.3) (15.9) (5.0) (1.0) 0.5 19.8 129.8 (0.3) 129.5 (58.4) (28.4) 0.1 (86.7) (16.2) (5.4) (1.0) 0.5 20.8 133.0 (0.3) 132.8 (59.9) (29.1) 0.1 (88.8) (16.4) (5.7) 1.0 (0.5) 22.3 136.4 (0.2) 136.1 (61.4) (29.8) 0.1 (91.1) (16.6) (5.6) 0.5 (0.3) 23.0

Investing Cash Flows

Capital Expenditure - PP&E Capital Expenditure - Intangibles Net Investing Cash Flows (7.0) (1.0) (8.0) (7.5) (1.3) (8.8) (8.0) (1.5) (9.5) (8.5) (1.8) (10.3) (9.0) (2.0) (11.0)

Financing Cash Flows

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Appendices
Section 3.
Financial Statements Modelling Exercise
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Section Cover Notes: This section contains Appendices

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Lookup Tables
Sub-Section 3.1.
Financial Statements Modelling Exercise
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Sub-Section Cover Notes: This sub-section contains Lookup Tables

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Time Series Lookup Tables

Financial Statements Modelling Exercise
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Time Series Lookup Tables

Month Days
Month Days 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

Names
LU_Mth_Days

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Time Series Lookup Tables

Financial Statements Modelling Exercise
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Month Names
Month Names January February March April May June July August September October November December

Names
LU_Mth_Names

Denomination
Denomination $Billions $Millions $'000 $

Names
LU_Denom Billions Millions Thousands Currency

Data Term Basis

Data Term Basis Active Data Periods Projections Start

Names
LU_Data_Term_Basis

Periodicity
Periodicity Annual Semi-Annual Quarterly Monthly

Names
LU_Periodicity Annual Semi_Annual Qtrly Mthly

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Time Series Lookup Tables

Financial Statements Modelling Exercise
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Period Type Names

Period Type Names Year Half Year Quarter Month

Names
LU_Period_Type_Names Yr_Name Half_Yr_Name Qtr_Name Mth_Name

Periods In Year
Periods In Year 1 2 4 12

Names
LU_Pers_In_Yr Yrs_In_Yr Halves_In_Yr Qtrs_In_Yr Mths_In_Yr

Conversion Factors
Conversion Factors 10 100 1,000 1,000,000 1,000,000,000

Names
Ten Hundred Thousand Million Billion

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Checks
Sub-Section 3.2.
Financial Statements Modelling Exercise
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Sub-Section Cover Notes: This sub-section contains Checks

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Checks
Financial Statements Modelling Exercise
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Error Checks
##

Include summary in model name?

Errors Detected - Summary

Total Errors: Error Message (Empty if None): -

Error Checks
Error Checks Balance Sheet Total Errors: Check Include? Yes Flag -

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Checks
Financial Statements Modelling Exercise
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Sensitivity Checks
##

Include summary in model name?

Sensitivities Detected - Summary

Total Sensitivities: Sensitivity Message (Empty if None): -

Sensitivity Checks
Sensitivity Checks Total Sensitivities: Check Include? Flag -

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Checks
Financial Statements Modelling Exercise
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Alert Checks
##

Include summary in model name?

Alerts Detected - Summary

Total Alerts: Alert Message (Empty if None): -

Alert Checks
Alert Checks Opening Balance Sheet Assumptions Total Alerts: Check Include? Yes Flag -

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