February 28, 2012
We already have the assumptions for modeling financial statements of Facebook in place with us. In the last tutorial we had started discussing regarding projecting future P/L, B/S and CFS of Facebook. We also had released a simple template for modeling future P/L, B/S and CFS of Facebook.
Projecting future financial statements is a part of complete financial analysis, done by using the assumptions modeled for the subject company. These Projecting Financial Statement for Facebook (P/L, B/S and CFS) are than used in present value based formula (DCF) to access a companyâ€™s market value. Today I give you a simple hint on using assumption to model the Projecting Financial Statement for Facebook and you should try to build the future statements of Facebook on your own.
Modeling future P/L Statement uses the assumptions related to each line item in the P/L statement.
Likewise modeling future B/S uses the assumptions related to each line item in the B/S.
Example of selected B/S items is given as follows:
Note: Remember to complete Balance Sheet modeling you have to link cash & cash equivalents in the balance sheet with the closing cash balance calculated in the cash flow statement.
Once future P/L & B/S is in place, modeling future cash flow statement (CFS) becomes a simple exercise because you have already categorized and linked the CFS with the P/L and B/S while modeling the historical cash flow statement. Now you just need to drag the formula till the required number of periods.
I hope you all will be able to do it correctly!!
In case you find any problem in modeling future P/L, B/S and CFS please write in our forum/blog, we will like to answer you queries.
2moro we will release filled template of projected future financial statements (P/L, B/S & CFS), so that you can check your progress.
Why go hunting for each individual post on our blog, when the entire Facebook Valuation Program can come right in your inbox? Yes. It’s now a simple click away, just provide your email address in the form below, and we will email you the entire 1 month program 1 article a day!!