Balance Sheet Projections

Now that our cash flow is complete, we can proceed to the balance sheet, which begins in Row 158. Before actually projecting the 2014 balance sheet, we need to pull in the pro forma balance sheet numbers we had calculated in our balance sheet adjustments analysis. We can simply link those numbers into the pro forma Column I. However, remember that we had consolidated several balance sheet line items for the working capital section. Those working capital line items are effectively balance sheet line items too. We should also follow the same procedure here, consolidating where appropriate. It might be cleaner to go back to the balance sheet adjustments analysis and combine the line items there so they are consolidated everywhere, but for purposes of the book let’s simply consolidate where needed in this balance sheet section.

To begin, we would like to link the cash balance in from the cash line in the Balance Sheet Adjustments section. So, I164 will read “ = H112.” The next line, “Receivables, ” is a consolidation of “Trade receivables” and “Other receivables” as per our discussions in Chapter 10, Working Capital. We should also consolidate here simply by adding both “Trade receivables” and “Other receivables” into Cell I165. Cell I165 will read “=H113+H114.” We will repeat the same process until we have a representation of the pro forma balance sheet here to build our projections off of. Note that the “Totals” should continue to total top-down ...

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