Balance sheet forecast
Quote from bsdinsight on 6 April 2025, 09:38Balance sheet forecast
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𝙏𝙝𝙚 𝙤𝙧𝙞𝙜𝙞𝙣𝙖𝙡 𝙥𝙤𝙨𝙩 𝙞𝙨 𝙝𝙚𝙧𝙚:
In the balance sheet projection and modeling, it’s crucial to ensure a balance between assets, equity, and liabilities.
When doing this, I place a check row at the top of the model, allowing you to continually verify that everything is balanced.
You should always see a zero in the red heading; otherwise, there may be an error in your modeling or formulas.
The first thing you should do is ensure that your historical records are successfully uploaded into the first two columns.
𝗕𝗮𝗹𝗮𝗻𝗰𝗲 𝘀𝗵𝗲𝗲𝘁 𝗽𝗿𝗼𝗷𝗲𝗰𝘁𝗶𝗼𝗻:
→ Build supporting sheets, CAPEX (purchase value, depreciation, carrying value), NWC sheet (AR, Inventories, AP, Other current assets and liabilities), Debt sheet (current and new loan schedules)
→ All items related to fixed assets should be imported from the ‘CAPEX’ sheet.
→ Shift your attention to current assets. The sources for these are twofold: inventories, account receivables, and other current assets are derived from the net working capital sheet.
→ The cash position is pulled from the ‘Projected Cash Flow Statements’ sheet.
→ A crucial part of the balance sheet projection is the calculation of equity. The formula to determine this is by taking the equity from the previous period, adding the net income (or subtracting the net loss) for the current period, accounting for any dividends, and then adjusting for any increase in share equity.
→ All long-term liabilities, as well as financial liabilities, should be imported from the ‘Debt’ sheet.
→ Trade payables and other current liabilities must be imported from the ‘net working capital’ sheet.
Balance sheet forecast
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𝙏𝙝𝙚 𝙤𝙧𝙞𝙜𝙞𝙣𝙖𝙡 𝙥𝙤𝙨𝙩 𝙞𝙨 𝙝𝙚𝙧𝙚:
In the balance sheet projection and modeling, it’s crucial to ensure a balance between assets, equity, and liabilities.
When doing this, I place a check row at the top of the model, allowing you to continually verify that everything is balanced.
You should always see a zero in the red heading; otherwise, there may be an error in your modeling or formulas.
The first thing you should do is ensure that your historical records are successfully uploaded into the first two columns.
𝗕𝗮𝗹𝗮𝗻𝗰𝗲 𝘀𝗵𝗲𝗲𝘁 𝗽𝗿𝗼𝗷𝗲𝗰𝘁𝗶𝗼𝗻:
→ Build supporting sheets, CAPEX (purchase value, depreciation, carrying value), NWC sheet (AR, Inventories, AP, Other current assets and liabilities), Debt sheet (current and new loan schedules)
→ All items related to fixed assets should be imported from the ‘CAPEX’ sheet.
→ Shift your attention to current assets. The sources for these are twofold: inventories, account receivables, and other current assets are derived from the net working capital sheet.
→ The cash position is pulled from the ‘Projected Cash Flow Statements’ sheet.
→ A crucial part of the balance sheet projection is the calculation of equity. The formula to determine this is by taking the equity from the previous period, adding the net income (or subtracting the net loss) for the current period, accounting for any dividends, and then adjusting for any increase in share equity.
→ All long-term liabilities, as well as financial liabilities, should be imported from the ‘Debt’ sheet.
→ Trade payables and other current liabilities must be imported from the ‘net working capital’ sheet.
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