The model template has the ability to enter up to 8 years. The user has the ability to enter both actuals and forecast numbers. In addition to the core operating assumptions the user has the ability to enter transaction and exit assumptions to reflect a leverage buy out (including one tranche of senior debt and deferred consideration). The user will also have the ability to build up assumptions for a discount rate based on WACC (Weighted Average Cost of Capital).
The core operations includes up to three sales divisions, the ability to add monthly seasonal trends.
The corporation tax is calculated in a flexible way to allow the user to determine the tax payments to fully reflect their own tax jurisdiction.
Other significant Profit and Loss balances include staff costs, rent and rates, maintenance and repairs, professional fees, and other exceptional items.
Significant Balance Sheet items include stock, debtors and creditors driven by working capital days assumptions. Calculations include VAT, corporation tax, interest, capital expenditure (and depreciation) and dividends.
Transaction assumptions include a flexible transaction date, assumptions around cash remaining in the business, the purchase price EBITDA (Earnings Before Interest Taxes Depreciation and Amortisation) multiple, transaction costs and the mix of funding sources (senior debt, deferred consideration via a vendor loan, and equity).
Exit assumptions include the exit date, the exit EBITDA multiple and transaction costs.
Senior debt has the flexibility to include an amortised arrangement fee as a percentage of debt raised. In addition, debt assumptions include the loan term, the schedule of amortisation payments (monthly/quarterly), the interest rate and the periodicity of interest roll up.
On valuation the user can enter the valuation date, the terminal growth rate and full WACC build up assumptions.