Financial Modelling for Debt Restructuring

This 3-day financial training workshop explores: Spreadsheet best practice Building a flexible credit model with integrated financial statements Historic analysis and bankruptcy assessment Forecasts and financial analysis Restructuring debt Stress testing Adding management reporting The workshop builds a complete restructuring model in stages starting with the historic accounts. Participants will learn: Application of principles of spreadsheet best practice Application of best practice principles to an integrated financial model How to interpret financial reports How to build a flexible restructuring model Methods to forecast and restructure debt Techniques for stress testing a credit model How to build reports and dashboards Teaching method The programme is taught using a mixture of instruction, demonstrations and practical exercises. The workshop emphasis concentrates on the application of financial theory to Excel to produce a flexible and informative model. Each session consists of theory, demonstrations and a practical exercise as delegates develop the model in incremental stages. The template for each session acts shows the solution to the previous session. Comprehensive product notes will be provided: participants receive a full pack of Excel software, reading material and templates for future reference as part of the course materials. Who should attend? This workshop will interest: Bank loan and credit officers Business/financial/treasury/ market analysts Corporate /structured/project finance officers Actuaries Investment bankers Management consultants and private equity Bond credit analysts Fixed income/credit traders/credit sales people M&A and equity analysts/investors Fund managers Treasurers Compliance officers Financial decision makers in corporations
Day 1 Case Study Outline Analysis framework Reasons for financial distress Warning signs Case study outline Model objectives Systematic Design Method Basic of spreadsheet design and modelling ‘rules’ Common spreadsheet errors Exercise: starting a basic model template Historic Statements Modelling initial accounts Income and balance sheet Exercise: adding and checking accounting statements Historic Analysis Identifying existing debt Calculating existing debt repayments and current balances Ratios -liquidity, structure and returns Existing debt cover and other ratios Bankruptcy ratios and scores Exercise: adding loan sheets and calculating ratios Historic Cash Flow Identifying existing trading cash flow Building a cash flow statement Cash ratios Risk description Exercise: adding a comprehensive cash flow statement Day 2 Forward Strategy Strategy review External and internal factors Peer group valuation Potential asset values and volatility Turnaround strategy Forecast Accounts Forecast accounts Time lines and flags Sales growth Cost base CAPEX requirements Working capital – stock, receivables, payables Integrity checks Avoiding circular references Exercise: completing initial forecast statements New Loans Excel functions Calculating new loans Rate, profile and timing Amortisation profiles Incorporating scenarios Exercise: calculating new loans and repayment profiles Completing Forecast Accounts Incorporating new loans Balancing the accounts Checking on requirements for further capital Recalculating forward ratios Computing forward default scores Integrity checks on results Exercise: adding loans to forecast statements and checking cash position Day 3 Forecast Cash Flow Forecast trading cash Specimen term sheet Debt cover Leverage Sustainable growth Bankruptcy scores Exercise: deriving debt waterfall Developing Scenarios Developing scenarios Understanding key factors Flexing the model Exercise: layering scenario testing on the initial model Sensitivity and Optimisation Quantifying key risks Varying the mix and terms Stress testing the model Updated bankruptcy scores Exercise: stress testing financing mix Model Completion Version control Documentation Chart output Dynamic dashboards Management summaries Exercise: model completion and final checks