BPM Financial ModellingFinancial Statements Modelling Exercise

Cover Notes:Provides a practical example of the modelling of live, three-way financial statements.

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Primary Model Developer: BPM Financial Modelling

Table of ContentsFinancial Statements Modelling Exercise

Section & Sheet Titles Page

1 Assumptions 3 Time Series Assumptions 4 Opening Balance Sheet Assumptions 6 Projected Assumptions 7

2 Financial Statements 8 Income Statement 9 Balance Sheet 10 Cash Flow Statement 11

3 Appendices 12

Lookup Tables 13 Time Series Lookup Tables 14

Checks 17 Checks 18

Error ChecksSensitivity ChecksAlert Checks

Total Pages: 20

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a.b.c.

a.b.c.

3.1.a.

3.2.a.

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AssumptionsSection 1.Financial Statements Modelling Exercise

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 AssumptionsFinancial Statements Modelling Exercise

Time Series Assumptions

Core Time Series Assumptions

Title PrimaryPeriodicity Annual

Financial Year End 31 12

Start Date 1-Jan-12 Periods 5

Denomination 2

Historical & Forecast Period Titles

Include in Period Titles? 1

Actual Periods 3 Budget Periods -

Data & Projections - Timing Assumptions

Data Term Basis 1

Data - Active Periods 3 Projections - Start Date 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 AssumptionsFinancial Statements Modelling Exercise

Opening Balance Sheet ($Millions)

Current Assets 1-Jan-12

Cash 50.0 Accounts Receivable 10.0 Other Current Assets 5.0 Total Current Assets 65.0

Non-Current Assets

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

Total Assets 432.0

Current Liabilities

Accounts Payable 8.0 Interest Payable 2.0 Dividends Payable 1.0 Income Tax Payable 6.0 Other Current Liabilities 2.0 Total Current Liabilities 19.0

Non-Current Liabilities

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

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Projected AssumptionsFinancial Statements Modelling Exercise

Year Ending 31 December 2012 (A) 2013 (A) 2014 (A) 2015 (F) 2016 (F)

Revenues & ExpensesBase Period Periodic Growth Rates (% per Year)

Sales $Millions 120.0 5.0% 3.0% 2.5% 2.5%

Cost of Goods Sold % of Sales 45.0% 45.0% 45.0% 45.0% 45.0%

Base Period Periodic Growth Rates (% per Year)Operating Expenditure $Millions 27.0 2.5% 2.5% 2.5% 2.5%

Capital Expenditure - PP&E $Millions 7.0 7.5 8.0 8.5 9.0 Capital Expenditure - Intangibles $Millions 1.0 1.3 1.5 1.8 2.0

Debtors & Creditors

Accounts Receivable Debtor Days 30 30 30 30 30

Accounts Payable Creditor Days 60 60 60 60 60

Assets

Depreciation & Amortisation Assumptions

Depreciation - PP&E % of Capex 90.0% 90.0% 90.0% 90.0% 90.0% Depreciation - Intangibles % of Capex 95.0% 95.0% 95.0% 95.0% 95.0%

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Financial StatementsSection 2.Financial Statements Modelling Exercise

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

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Income StatementFinancial Statements Modelling Exercise

Year Ending 31 December 2012 (A) 2013 (A) 2014 (A) 2015 (F) 2016 (F)

Income Statement ($Millions)

Sales 120.0 126.0 129.8 133.0 136.4 Cost of Goods Sold (54.0) (56.7) (58.4) (59.9) (61.4)

Gross Margin 66.0 69.3 71.4 73.2 75.0

Operating Expenditure (27.0) (27.7) (28.4) (29.1) (29.8)

EBITDA 39.0 41.6 43.0 44.1 45.2

Depreciation - PP&E (6.3) (6.8) (7.2) (7.7) (8.1)Depreciation - Intangibles (1.0) (1.2) (1.4) (1.7) (1.9)

Total Depreciation & Amortisation (7.3) (7.9) (8.6) (9.3) (10.0)

EBIT 31.8 33.7 34.4 34.8 35.2

Interest Expense (15.9) (16.2) (16.4) (16.6) (16.9)

Net Profit Before Tax (NPBT) 15.8 17.5 18.0 18.1 18.3

Tax Expense (4.7) (5.3) (5.4) (5.4) (5.5)

Net Profit After Tax (NPAT) 11.1 12.3 12.6 12.7 12.8

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Balance SheetFinancial Statements Modelling Exercise

Year Ending 31 December 2012 (A) 2013 (A) 2014 (A) 2015 (F) 2016 (F)

Balance Sheet ($Millions)

Current Assets

Opening Cash 50.0 76.0 85.1 92.2 97.9 Net Change in Cash Held 26.0 9.1 7.1 5.8 9.7

Cash 76.0 85.1 92.2 97.9 107.6 Accounts Receivable 9.8 10.4 10.7 10.9 11.2 Other Current Assets 1.0 2.0 3.0 2.0 1.5 Total Current Assets 86.8 97.4 105.8 110.9 120.3

Non-Current Assets

PP&E 250.7 251.5 252.3 253.1 254.0 Intangibles 100.1 100.1 100.2 100.3 100.4 Deferred Tax Assets 5 5 5 5 5 Other Non-Current Assets 12.0 12.0 12.0 12.0 12.0 Total Non-Current Assets 367.8 368.6 369.4 370.4 371.4

Total Assets 454.6 466.0 475.3 481.2 491.7

Current Liabilities

Accounts Payable 4.4 4.5 4.7 4.8 4.9 Interest Payable 15.9 16.2 16.4 16.6 16.9

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Cash Flow StatementFinancial Statements Modelling Exercise

Year Ending 31 December 2012 (A) 2013 (A) 2014 (A) 2015 (F) 2016 (F)

Cash Flow Statement ($Millions)

Operating Cash Flows

Sales 120.0 126.0 129.8 133.0 136.4 Decrease in Accounts Receivable 0.2 (0.5) (0.3) (0.3) (0.2)

Cash Receipts 120.2 125.5 129.5 132.8 136.1 Cost of Goods Sold (54.0) (56.7) (58.4) (59.9) (61.4)Operating Expenditure (27.0) (27.7) (28.4) (29.1) (29.8)Increase in Accounts Payable (3.6) 0.1 0.1 0.1 0.1

Cash Payments (84.6) (84.3) (86.7) (88.8) (91.1)Interest Paid (2.0) (15.9) (16.2) (16.4) (16.6)Tax Paid (4.6) (5.0) (5.4) (5.7) (5.6)Decrease / (Increase) in Other Current Assets 4.0 (1.0) (1.0) 1.0 0.5 Increase / (Decrease) in Other Current Liabilities (1.5) 0.5 0.5 (0.5) (0.3)Net Operating Cash Flows 31.5 19.8 20.8 22.3 23.0

Investing Cash Flows

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

Financing Cash Flows

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AppendicesSection 3.Financial Statements Modelling Exercise

Section Cover Notes:This section contains Appendices

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Lookup TablesSub-Section 3.1.Financial Statements Modelling Exercise

Sub-Section Cover Notes:This sub-section contains Lookup Tables

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Time Series Lookup TablesFinancial Statements Modelling Exercise

Time Series Lookup Tables

Month Days Names

Month Days LU_Mth_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

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Time Series Lookup TablesFinancial Statements Modelling ExerciseGo to Table of Contentsç è

Month Names Names

Month Names LU_Mth_NamesJanuary

FebruaryMarchAprilMayJuneJuly

AugustSeptember

OctoberNovemberDecember

Denomination Names

Denomination LU_Denom$Billions Billions$Millions Millions

$'000 Thousands$ Currency

Data Term Basis Names

Data Term Basis LU_Data_Term_BasisActive Data Periods

Projections Start

Periodicity Names

Periodicity LU_PeriodicityAnnual Annual

Semi-Annual Semi_AnnualQuarterly QtrlyMonthly Mthly

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Time Series Lookup TablesFinancial Statements Modelling ExerciseGo to Table of Contentsç è

Period Type Names Names

Period Type Names LU_Period_Type_NamesYear Yr_Name

Half Year Half_Yr_NameQuarter Qtr_NameMonth Mth_Name

Periods In Year Names

Periods In Year LU_Pers_In_Yr 1 Yrs_In_Yr 2 Halves_In_Yr 4 Qtrs_In_Yr

12 Mths_In_Yr

Conversion Factors Names

Conversion Factors 10 Ten

100 Hundred 1,000 Thousand

1,000,000 Million 1,000,000,000 Billion

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ChecksSub-Section 3.2.Financial Statements Modelling Exercise

Sub-Section Cover Notes:This sub-section contains Checks

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ChecksFinancial Statements Modelling Exercise

Error Checks

1

Errors Detected - Summary

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

Error Checks

Error Checks Check Include? Flag

Balance Sheet - Yes -

Total Errors: -

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Include summary in model name?

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Sensitivity Checks

1

Sensitivities Detected - Summary

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

Sensitivity Checks

Sensitivity Checks Check Include? Flag

Total Sensitivities: -

Include summary in model name?

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Alert Checks

1

Alerts Detected - Summary

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

Alert Checks

Alert Checks Check Include? Flag

Opening Balance Sheet Assumptions - Yes -

Total Alerts: -

Include summary in model name?