Master Class In Financial Modelling For Power & Utilities

Completion of Operating Section of Model

• The third section of the course works through issues associated with completing the operating section of a model including timing issues, depreciation, growth and inflation, construction analysis and project IRR measurement.

Comparison of Actual to Forecast

• The fourth section is a new module that demonstrates alternative ways of comparing actual results with results that were initially forecast in a financial model. The theory of performance measurement and practical issues are addressed.

Addition of Debt to Forecast

• As project finance is a type of debt, the third module addresses various theoretical and practical issues related to debt financing in general and project debt in particular. Subjects included in module three include setting up a debt schedule, debt sculpting, flexible debt terms, debt capacity, debt structure, and credit measures. The debt analysis is scheduled to take an entire day.

Merchant Prices in Financial Models

• The sixth module introduces merchant markets and the incorporation of merchant prices in financial models. This section of the course also introduces tools with respect to reading data from the internet and efficiently working with databases. The theory of long-term marginal cost and short-term marginal cost is explained in the context of merchant price analysis financial modeling.

Credit Enhancements and Cash Flow Waterfall

• Given the merchant model pricing section, the seventh model demonstrates how bankers evaluate the risk of fluctuating cash flow. A cash flow waterfall is added to the model and cash sweeps.

Financial Ratios and Financial Statements

• The eighth module completes the project finance model through the inclusion of a profit and loss statement and computation of income taxes. Given the income, a balance sheet is computed to verify calculations in the model. Finally, the LLCR, PLCR and the average debt life are computed.