From: 21 February 2018
To: 22 February 2018
Hotel Ayana, MidPlaza
Jl. Jend. Sudirman Kav 10-11, Jakarta
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  • Summary

In this two-day training, the participant will learn in a quick way about the project finance modeling, which differs from a standard corporate financial model because the investment is characterized by alternative time phases that have different risks, and by the fact that no history on cash flows exists for the investment analyses. The project finance models focus on cash flows accruing to equity holders and lenders rather than earnings or balance sheet items, and projections in a project finance model generally cover the entire defined lifetime of the project. Rather than evaluating return on investment, the key outputs of a project finance model are generally the internal rate of return (IRR) that accrues to equity holders or is computed on the basis of free cash flow (project IRR).

First Day

The participants will be introduced first with a case study, which together with the trainer, to build a cash flow model only, that is, no income statement account and no balance sheet is required. Thus, little knowledge of accounting and finance is required.

The following finance and modeling concepts are covered in this case study:

  • Debt vs equity
  • Interest rate (compounded)
  • Rolled-up interest
  • Debt Service Coverage Ratio (DSCR)
  • Cash flows
  • Pre-tax and Post-Tax Internal Rate of Return (IRR and XIRR functions)
  • Cash waterfalls
  • Flags and setting timeline
  • Conditional formatting
  • Goal Seek function
  • Grouping data
  • Sources and Uses of Fund
  • Inputs, Calculation, and Output Sheets

Second Day

In the second day, the participants will be introduced to the following concepts that are generally used:

  • Timing in Project Finance
  • CFADS (Cash Flows Available for Debt Service)
  • Modeling DSRA (Debt Service Reserve Account)
  • Debt sizing
  • Debt sculpting to target DSCR without VBA
  • Modeling a Major Maintenance Reserve Account (MMRA)
  • Modeling debt principal repayment
  • Project Life Coverage Ratio (PLCR)
  • Loan Life Coverage Ratio (LLCR)

Kindly download the attachment for more information.