Total Debt/Loan Composition Analysis Excel Tool (Excel XLSX)

Total Debt/Loan Composition Analysis is critical for assessing a company's financial health and risk management. It breaks down the debt structure, detailing types, terms, and interest rates of loans. This analysis helps in evaluating the company's ability to meet debt obligations, plan for refinancing, and optimize capital allocation. By identifying high-cost or risky loans, it enables proactive measures to reduce financial vulnerability. Moreover, it's crucial for investors and lenders to gauge a firm's creditworthiness. In essence, Total Debt/Loan Composition Analysis is vital for informed decision-making, financial stability, and sustainable growth.

PURPOSE OF TOOL
Highly versatile and user-friendly Excel tool for analysing the projected development of the total debt composition of a business or individual. The tool allows the user to model the expected cash flows and balances on existing debt facilities, add in the impact of new debt facilities, refinancing of existing debt facilities and/or the impact of specific drawdowns or repayments on existing or new debt facilities. The purpose of the tool is to assist users in understanding the development of their total debt facilities across time and make informed decisions on changes to their debt facilities.

METHODOLOGY
The template calculates the remaining cash flows to full settlement of existing or new debt facilities. The tool allows new debt facilities to be added, existing facilities to be refinanced with new facilities and specific additions/repayments to be made to existing or new debt facilities. Cash flows are calculated on a monthly basis for up to 20 years. The template allows calculations for up to 10 existing debt facilities and 10 new debt facilities. Each debt facility is specified and calculated separately and contains a full reconciliation from Opening to Closing Balance for each month.

KEY OUTPUTS
The tool computes a number of:
•  Net cash flows of existing and new debt facilities on a monthly and yearly basis across projection period;
•  Debt balances for by facility, lender, debt type and base rate type for each month and year across projection period;
•  Total interest expense by debt facility for each month and year across projection period;
•  Full control account for each debt facility (opening balance to closing balance reconciliation);
•  Exposure charts showing splits by lender, debt type and base rate for a particular projection year;
•  Charts showing developments of cumulative cash flows, interest expense and debt balances on total basis.
•  Summary of key metrics for any chosen projection year showing:
Average interest rate for that year;
Total debt balance at end of that year;
Cumulative net cash flows from start of projection to chosen year;
Cumulative changes in debt principal from start of projection to chosen year;
Cumulative interest and transaction expenses from start of projection to chosen year.

KEY INPUTS
The key user-defined inputs of the tool are split into setup inputs, facility inputs and other projection inputs as follows:

Setup Inputs:
•  Business or individual name
•  Currency
•  First projection year and month
•  List of base rates (up to 5 – but can be extended)
•  List of lenders (up to 5 – but can be extended)
•  List of debt types (up to 5 – but can be extended)

Facility Inputs:
•  Facility name;
•  Lender (from list of lenders specified above);
•  Facility type (from list of debt types specified above);
•  Balance at start of projection period (for existing facilities only);
•  Start date (for new facilities only);
•  Maturity date;
•  Base rate (from list of base rates);
•  Margin rate;
•  Interest-only or amortising debt (drop down);
•  Payment frequency (monthly, quarterly, semi-annually or annually)
•  Transaction costs (for new facilities only);
•  New debt amount or existing facility the new facility is replacing.

Other
•  Base rate forward interest rates
•  Specific addition and repayment amounts for existing and new debt facilities

STRUCTURE
The template contains, 6 tabs split into input ('i_'), calculation ('c_'), output ('o_') and system tabs. The only tab to be populated by the user are the input tabs ('i_Setup' and ‘i_Assumptions'). The calculation tab uses the user-defined inputs to calculate and produce the template outputs presented in 'o_Results'.

System tabs include the following:
•  'Front Sheet' containing a disclaimer, instructions and contents;
•  Checks dashboard containing a summary of checks by tab.

OTHER KEY FEATURES
Other key features of this tool include the following:
•  The tool follows best practice financial modelling guidelines and includes instructions, checks and input validations;
•  The tool can calculate projected cash flows and balances for up to 10 existing and 10 new debt facilities;
•  The tool can calculate projected cash flows and balances on a monthly basis for a maximum period of 20 years from projection start date;
•  The tool can calculate projected cash flows/balances for an interest-only debt / debt (all principal is paid on maturity date) or an amortising debt / debt (principal is paid as part of the periodic instalments across the life of the debt);
•  Business/individual name, currency, projection start, facility names, lender names, base rates and debt types are fully customisable;
•  Each debt facility is specified and calculated separately and contains a full reconciliation from opening to closing balance for each month;
•  The tool includes a checks dashboard which summarises all the checks included in the various tabs making it easier to identify any errors;
•  The tool includes checks and input validations to help ensure input fields are populated accurately.