Ibp - Ecu

INSTRUCTIONS - How to use NVFinPak
Following are some rudimentary instructions on how to make NVFinPak work for you.
0. First, save this Excel file under a new name (e.g. the business name) to conserve the original spreadsheet with all formulas
and links intact - you may wish to protect some cells so that these formulas & links cannot be inadvertently changed.
1. Note that all data for the first five years is entered in the spreadsheet called 'Yr 1-5 details'. From there the data links to the
Yr 1-10 graphs and summary sheets. Data for years 6-10 (if needed) must be added in the Yr 1-10 summary sheet.
2. Start by entering your revenue data at the top of the 'Yr 1-5 details' sheet, as follows:
a. Set the price level for each month for years 1-2 and then for each quarter for years 3-5 (in row 7). Make sure you
discount the 'regular' or longer term price for any introductory discounts need to induce customer trial.
b. Set the volume of sales at each price level out along row 8. Make sure you have sales volume growing in accordance
with your assumptions of the rate of market penetration (refer to the 'diffusion curve' in Business Plans 1).
c. If your business has multiple products, you may wish to do one of the following two things:
1. Simply enter total sales revenues for each month and quarter, in row 9, or
2. Set up a table on a new sheet with prices and volumes for each product line and link the sales revenue
data to the cells in row 9 of the 'Yr 1-5 details' sheet.
3. Insert the per unit direct (average variable) cost in row 11. Make sure you allow for any learning curve effects or scale economies
which would cause unit direct cost to decline as cumulative volume produced increases.
4. Enter any initial costs of establishing the business, such as licence fees and other set-up costs that are to be expensed
rather than capitalised, in row 18, in the months and quarters when they are expected to occur.
5. DO NOT enter the other Operating Expenses in rows 19-24. Note that these cells are linked to other cells lower down the
spreadsheet. Instead, go down to this area (about row 153) and work through the Human Resource Worksheet and the
related Category Expense details below that, and let the data entered feed back up to the Income Statement.
6. Similarly, go to the Depreciation worksheet (about row 130) and enter any purchases of Plant and Equipment in row 132 and the
number of months over which the asset is to be depreciated in cell B133. Complete this worksheet for any depreciable
Intellectual Property and the data will link back to the Income Statement.
7. Now go to the bottom of the Cash Flow Statement (about row 126) and see if Cash Balances are negative or dangerously low.
If they are, then the business must have a cash infusion to avoid bankruptcy. So you must enter cash raised from either
Grants, Debt, or Equity funding in rows 112 to 114 to cause Cash Balances at the end of each month or quarter to be
at desired levels. This is how you find out how much funding you need to raise for your new venture.
8. At this point your Income Statement, Balance Sheet, and Cashflow Statement should be complete. You may wish to adjust some
of the assumptions (rates) that impact interest earned, interest payable, accounts receivable, accounts payable, etc.
9. When adjusting the revenues and cost data, the human resource worksheet and category expense details, and the cash inflow
from financing, you can take a quick peek at the 10 year graphs' sheet to see pictorially what has been the impact of
your adjustments.
10. To determine the Net Present Value (NPV) of the business, and the Internal Rate of Return (IRR) and the share of equity that
might be offered to investors, go to the bottom of the 'Yr 1-10 summary' sheet (about row 126) and complete the
worksheet there.
Insert Company name here
Income Statement (000s)
Year of Operation
(Most Likely Scenario)

2005
Financial Year ending June 30
July
Price/unit (net of discounts)

Units volume
TOTAL SALES
20000
1
20000
80
1
80
80
1
80
90
2
180
90
2
180
90
3
270
100
3
300
100
4
400
100
4
400
100
5
500
100
5
500
100
5
500
100
36
23390
Unit direct cost

COST OF GOODS SOLD
% of Total Sales
GROSS PROFIT
% Gross Margin
80
80
0%
19920
100%
80
80
100%
0
0%
78
78
98%
2
3%
75
150
83%
30
17%
73
146
81%
34
19%
72
216
80%
54
20%
71
213
71%
87
29%
70
280
70%
120
30%
69
276
69%
124
31%
68
340
68%
160
32%
67
335
67%
165
33%
66
330
66%
170
34%
66
2524
11%
20866
89%
1000
960
35
167
1
2162
11%
0
43
35
167
1
245
307%
0
43
35
167
2
246
307%
0
68
35
167
2
271
151%
0
68
35
167
3
272
151%
0
91
35
167
4
297
110%
0
104
45
417
5
570
190%
0
128
45
417
5
595
149%
0
128
45
417
6
595
149%
0
168
55
417
6
646
129%
0
168
55
417
7
646
129%
0
168
55
417
7
647
129%
1000
2137
508
3500
48
7192
31%
17758
-245
-244
-241
-238
-243
-483
-475
-471
-486
-481
-477
13674
0
0.00
0
70
0.00
70
83
0.00
83
83
0.00
83
82
0.00
82
82
0.00
82
82
0.00
82
94
0.00
94
94
0.00
94
94
0.00
94
94
0.00
94
94
0.00
94
952
0.00
952
17758
0
17758
89%
-175
0
-175
-219%
-161
0
-161
-202%
-159
0
-159
-88%
-156
0
-156
-86%
-161
0
-161
-60%
-401
0
-401
-134%
-381
0
-381
-95%
-377
0
-377
-94%
-392
0
-392
-78%
-387
0
-387
-77%
-383
0
-383
-77%
14625
0
14625
63%
2000
2000
0
19758
0
19758
19758
19583
0
19583
19583
19422
0
19422
19422
19263
0
19263
19263
19108
0
19108
19108
18947
0
18947
18947
18546
0
18546
18546
18165
0
18165
18165
17788
0
17788
17788
17396
0
17396
17396
17008
0
17008
17008
16625
0
16625
0
16625
0
16625
OPERATING EXPENSES
Setup costs
Sales and Marketing
General and Administrative
Depreciation of P&E
Depreciation of R&D & IPP
TOTAL OPERATING EXPENSES
% of Total Sales
INCOME BEFORE INTEREST & TAXES
Interest income
Interest expense
NET INTEREST INCOME
INCOME BEFORE TAXES
Taxes on income
NET INCOME
% of Total Sales
GRANTS RECEIVED
Retained Earnings (opening)
Available for Distribution
Dividends Paid
RETAINED EARNINGS (CLOSING)
Mnth
0.4%
2%
33%
Aug
Sept
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
June
Total

Year of Operation
ASSETS
CURRENT ASSETS
CASH & MARKETABLE SECURITIES
A/R Opening Balance
A/R Closing Balance
ACCOUNTS RECEIVABLES
Balance Sheet (000s)

2005
July
Aug
Sept
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
June
Total
16894
0
3000
3000
19836
3000
12
12
19804
12
12
12
19761
12
27
27
19729
27
27
27
19632
27
41
41
22596
41
45
45
22573
45
60
60
22562
60
60
60
22523
60
75
75
22497
75
75
75
22477
75
75
75
22477
75
75
75
INVENTORY (% of Cost of Goods Sold)

TOTAL CURRENT ASSETS
7
19901
14
19861
20
19836
33
19821
45
19801
64
19736
82
22723
106
22738
129
22751
158
22756
186
22759
215
22767
215
22767
PLANT AND EQUIPMENT

Less: (Accum. Depr)
NET PLANT AND EQUIPMENT
10000
167
9833
10000
333
9667
10000
500
9500
10000
667
9333
10000
833
9167
10000
1000
9000
25000
1417
23583
25000
1833
23167
25000
2250
22750
25000
2667
22333
25000
3083
21917
25000
3500
21500
25000
3500
21500
32
1
32
65
2
63
97
3
94
130
5
125
162
8
154
245
12
233
277
17
261
310
22
288
342
28
315
375
34
341
407
41
367
440
48
392
440
48
392
29766
29591
29430
29278
29122
28969
46567
46193
45815
45430
45042
44658
44658
0
8
8
0
0
8
0
8
8
0
0
8
0
8
8
0
0
8
0
15
15
0
0
15
0
15
15
0
0
15
0
22
22
0
0
22
0
21
21
0
0
21
0
28
28
0
0
28
0
28
28
0
0
28
0
34
34
0
0
34
0
34
34
0
0
34
0
33
33
0
0
33
0
33
33
0
0
33
OWNERS' EQUITY
Common Stock
Retained Earnings
TOTAL OWNER'S EQUITY
10000
19758
29758
10000
19583
29583
10000
19422
29422
10000
19263
29263
10000
19108
29108
10000
18947
28947
28000
18546
46546
28000
18165
46165
28000
17788
45788
28000
17396
45396
28000
17008
45008
28000
16625
44625
28000
16625
44625
TOTAL LIABILITIES & EQUITY

Check difference
29766
0
29591
0
29430
0
29278
0
29122
0
28969
0
46567
0
46193
0
45815
0
45430
0
45042
0
44658
0
44658
0
Jan
Feb
15%
R&D AND INTELLECT. PROP.

Less: (Accum. Depr)
NET INTANGIBLE ASSETS
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Short term Debt
Accounts Payable
TOTAL CURRENT LIABILITIES
Shareholders Loans
Long Term Debt
TOTAL LIABILITIES
Cashflow Statement (000s)
Year of Operation
CASH INFLOW FROM OPERATIONS
Sales Revenue ($000s)
Plus: A/R opening balance
Less: A/R ending balance
2005
July
Aug
Sept
Oct
Nov
Dec
Mar
Apr
May
June
Total
20000
0
3000
17000
80
3000
12
3068
80
12
12
80
180
12
27
165
180
27
27
180
270
27
41
257
300
41
45
296
400
45
60
385
400
60
60
400
500
60
75
485
500
75
75
500
500
75
75
500
23390
0
75
500
1000
80
0
8
72
0
80
8
8
80
0
78
8
8
78
0
150
8
15
143
0
146
15
15
146
0
216
15
22
209
0
213
22
21
213
0
280
21
28
273
0
276
28
28
276
0
340
28
34
334
0
335
34
34
336
0
330
34
33
331
1000
2524
0
33
2491
960
35
32
0
0
7
10000
11034
4894
43
35
32
0
0
7
0
117
2871
43
35
32
0
0
7
0
117
-115
68
35
32
0
0
13
0
148
-126
68
35
32
0
0
12
0
147
-114
91
35
32
50
0
18
0
227
-180
104
45
32
0
0
18
15000
15200
-15117
128
45
32
0
0
24
0
229
-118
128
45
32
0
0
23
0
229
-105
168
55
32
0
0
29
0
284
-133
168
55
32
0
0
28
0
284
-119
168
55
32
0
0
28
0
283
-114
2137
508
390
50
0
215
25000
28299
-31290
CASH INFLOW FROM FINANCING

Interest earned
Grants Received
Equity funding
Proceeds from Debt funding
0
2000
10000
0
12000
70
0
0
0
70
83
0
0
0
83
83
0
0
0
83
82
0
0
0
82
82
0
0
0
82
82
0
18000
0
18082
94
0
0
0
94
94
0
0
0
94
94
0
0
0
94
94
0
0
0
94
94
0
0
0
94
952
2000
28000
0
30952
CASH OUTFLOW FROM FINANCING

Interest payable
Debt retirement
Cash Dividends
NET FINANCING CASH FLOWS
0
0
0
0
12000
0
0
0
0
70
0
0
0
0
83
0
0
0
0
83
0
0
0
0
82
0
0
0
0
82
0
0
0
0
18082
0
0
0
0
94
0
0
0
0
94
0
0
0
0
94
0
0
0
0
94
0
0
0
0
94
0
0
0
0
30952
NET CASH FLOW

OPENING CASH BALANCES
ENDING CASH BALANCES
16894
0
16894
2942
16894
19836
-32
19836
19804
-43
19804
19761
-32
19761
19729
-97
19729
19632
2964
19632
22596
-23
22596
22573
-11
22573
22562
-39
22562
22523
-25
22523
22497
-20
22497
22477
-338
0
22477
CASH OUTFLOW FROM OPERATIONS

SETUP COSTS
Cost of Goods Sold
Plus: A/P opening balance
Less: A/P ending balance
CASH PURCHASES
Sales & Marketing Expenses
General & Administrative Exp
Research & Development
Intellectual Property Protection
Taxes payable
Net increase in Inventory
Net increase in Equipment
CASH EXPENSE DISBURSEMENTS
NET OPERATING CASH FLOWS
10%
9%
Depreciation Schedules

2005
PLANT AND EQUIPMENT

Asset Purchases
Cum. Plant and Equipment
TOTAL ASSET DEPRECIATION
Cumulative Depreciation
R&D EXPENDITURES
R&D V.P
R&D Senior Staff
R&D Junior Staff
Benefits (% of Salaries)
TOTAL R&D SALARIES/BENEFITS
R&D Project Materials
TOTAL R&D EXPENDITURES
IP Rights
TOTAL R&D AND INTELL. PROPERTY
Cum. R&D and IP Expenditures
DEPRECIATION - R&D AND IP
NET R&D AND INTELL. PROPERTY
July
Aug
Sept
Oct
Nov
Dec
Jan
Feb
Mar
Apr
10000
10000
167
167
9833
0
10000
167
333
9667
0
10000
167
500
9500
0
10000
167
667
9333
0
10000
167
833
9167
0
10000
167
1000
9000
15000
25000
417
1417
23583
0
25000
417
1833
23167
0
25000
417
2250
22750
0
25000
417
2667
22333
May
0
25000
417
3083
21917
June
0
25000
417
3500
21500
Total
25000
25000
3500
3500
21500
4
8
2
2
16
17
32
0
32
32
1
1
32
4
8
2
2
16
17
32
0
32
65
1
2
63
4
8
2
2
16
17
32
0
32
97
2
3
94
4
8
2
2
16
17
32
0
32
130
2
5
125
4
8
2
2
16
17
32
0
32
162
3
8
154
4
8
2
2
16
17
32
50
82
245
4
12
233
4
8
2
2
16
17
32
0
32
277
5
17
261
4
8
2
2
16
17
32
0
32
310
5
22
288
4
8
2
2
16
17
32
0
32
342
6
28
315
4
8
2
2
16
17
32
0
32
375
6
34
341
4
8
2
2
16
17
32
0
32
407
7
41
367
4
8
2
2
16
17
32
0
32
440
7
48
392
50
90
25
25
190
200
390
50
440
440
48
48
392
Mnths
60
Base Salary
4.2
3.8
2.1
15%
Mnths
60
Human Resource Worksheet

July
Aug
Sept
Oct
Nov
Dec
2005
Jan
Feb
Mar
Apr
May
June
Total
RESEARCH AND DEVELOPMENT

V.P. - R&D
R&D Senior Staff
R&D Junior Staff
TOTAL R&D STAFF NUMBERS
1
2
1
4
1
2
1
4
1
2
1
4
1
2
1
4
1
2
1
4
1
2
1
4
1
2
1
4
1
2
1
4
1
2
1
4
1
2
1
4
1
2
1
4
1
2
1
4
1
2
1
4
SALES & MARKETING STAFF

V.P. - Marketing
Marketing Staff
V.P. - Sales
Sales Staff
TOTAL SALES & MARKETING STAFF
1
0
0
0
1
1
1
0
0
2
1
1
0
0
2
1
1
0
0
2
1
1
0
0
2
1
1
0
0
2
1
2
1
0
4
1
2
1
0
4
1
2
1
0
4
1
2
1
1
5
1
2
1
1
5
1
2
1
1
5
1
2
1
1
5
GENERAL & ADMINISTRATIVE STAFF

CEO
CFO
COO
Administrative Staff
TOTAL GENERAL & ADMIN. STAFF
1
0
0
2
3
1
0
0
2
3
1
0
0
2
3
1
0
0
2
3
1
0
0
2
3
1
0
0
2
3
1
1
0
3
5
1
1
0
3
5
1
1
0
3
5
1
1
1
4
7
1
1
1
4
7
1
1
1
4
7
1
1
1
4
7
TOTAL STAFF PROJECTIONS
13
13
13
16
16
16
16
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
SALARY RELATED ISSUES

Salary Increases - CEO / VP R&D
Across Board Salary Increases
Base
Base
Category Expense Details
July
Aug
Sept
Oct
Nov
Dec
SALES & MKT SALARIES/BENEFITS
Mnt Base Salary
V.P. - Marketing
8.3
8.3
8.3
8.3
8.3
8.3
8.3
Marketing Staff
5.4
0.0
0.0
0.0
0.0
0.0
0.0
V.P. - Sales
8.3
0.0
0.0
0.0
0.0
0.0
0.0
Sales Staff Salaries
4.2
8.3
8.3
8.3
8.3
8.3
8.3
Commissions / Unit Sales
4%
800.0
3.2
3.2
7.2
7.2
10.8
15%
123.0
3.0
3.0
4.0
4.0
4.0
TOTAL SALES & MKT SALARIES/BENEFITS
940
23
23
28
28
31
Marketing Materials
20
20
20
20
40
40
60
TOTAL SALES & MARKETING EXPENSES
960
43
43
68
68
91
% of Sales
5%
54%
54%
38%
38%
34%
GEN & ADMIN. SALARIES/BENEFITS
CEO
CFO
COO
TOTAL G&A SALARIES/BENEFITS
Base Salary
12.5
7.1
7.5
2.9
15%
MISCELLANEOUS GEN & ADMIN EXPENSE

Lease Expenses
Business Travel
Gen Expense (IT, Supplies)
TOTAL MISC GEN & ADMIN EXPENSE
TOTAL GEN & ADMIN EXPENSES
% of Sales

2005
Jan
Feb
Mar
Apr
May
June
Total
8.3
5.4
0.0
12.5
12.0
6.0
44
60
104
35%
8.3
5.4
0.0
12.5
16.0
6.0
48
80
128
32%
8.3
5.4
0.0
12.5
16.0
6.0
48
80
128
32%
8.3
5.4
8.3
16.7
20.0
9.0
68
100
168
34%
8.3
5.4
8.3
16.7
20.0
9.0
68
100
168
34%
8.3
5.4
8.3
16.7
20.0
9.0
68
100
168
34%
100
33
25
138
936
186
1417
720
2137
9%
12.5
0.0
0.0
5.8
1.9
20
12.5
0.0
0.0
5.8
1.9
20
12.5
0.0
0.0
5.8
1.9
20
12.5
0.0
0.0
5.8
1.9
20
12.5
0.0
0.0
5.8
1.9
20
12.5
0.0
0.0
5.8
1.9
20
12.5
7.1
0.0
8.8
1.9
30
12.5
7.1
0.0
8.8
1.9
30
12.5
7.1
0.0
8.8
1.9
30
12.5
7.1
7.5
11.7
1.9
41
12.5
7.1
7.5
11.7
1.9
41
12.5
7.1
7.5
11.7
1.9
41
150
43
23
96
23
334
3.0
7.5
4.0
15
3.0
7.5
4.0
15
3.0
7.5
4.0
15
3.0
7.5
4.0
15
3.0
7.5
4.0
15
3.0
7.5
4.0
15
3.0
7.5
4.0
15
3.0
7.5
4.0
15
3.0
7.5
4.0
15
3.0
7.5
4.0
15
3.0
7.5
4.0
15
3.0
7.5
4.0
15
36
90
48
174
35
0.2%
35
43.4%
35
43.4%
35
19.3%
35
19.3%
35
12.9%
45
14.9%
45
11.2%
45
11.2%
55
11.0%
55
11.0%
55
11.0%
508
2.2%
Year of Operation
2006
Jul

Units volume
TOTAL SALES
Aug
Sept
Oct
Nov
Dec
Jan
2007
Feb
Mar
Apr
May
June
Total
Q1
Q2
2008
Q3
Q4
Total
2009
Q1
Q2
Q3
Q4
Total
Q1
Q2
120
6
720
120
6
720
120
7
840
120
7
840
120
8
960
120
8
960
150
9
1350
150
10
1500
150
10
1500
150
11
1650
150
11
1650
150
12
1800
150
105
14490
180
40
7200
180
45
8100
180
50
9000
180
55
9900
180
190
34200
200
60
12000
200
65
13000
200
70
14000
200
75
15000
200
270
54000
200
80
16000
200
85
17000
Unit direct cost

COST OF GOODS SOLD
% of Total Sales
GROSS PROFIT
% Gross Margin
65
390
54%
330
46%
64
384
53%
336
47%
64
448
53%
392
47%
63
441
53%
399
48%
62
496
52%
464
48%
61
488
51%
472
49%
60
540
40%
810
60%
59
590
39%
910
61%
58
580
39%
920
61%
57
627
38%
1023
62%
56
616
37%
1034
63%
55
660
37%
1140
63%
55
6260
43%
8230
57%
54
2160
30%
5040
70%
53
2385
29%
5715
71%
52
2600
29%
6400
71%
51
2805
28%
7095
72%
51
9950
29%
24250
71%
50
3000
25%
9000
75%
50
3250
25%
9750
75%
49
3430
25%
10570
76%
49
3675
25%
11325
76%
49
13355
25%
40645
75%
48
3840
24%
12160
76%
48
4080
24%
12920
76%
OPERATING EXPENSES
Setup costs
Sales and Marketing
Depreciation of P&E
% of Total Sales
0
170
58
417
9
654
91%
0
120
41
417
9
587
82%
0
140
41
417
10
608
72%
0
140
41
417
11
609
72%
0
160
41
417
12
629
66%
0
160
41
421
13
635
66%
0
180
41
421
14
656
49%
0
200
41
421
15
677
45%
0
200
41
421
15
677
45%
0
220
41
421
17
699
42%
0
220
41
421
17
699
42%
0
240
41
421
18
720
40%
0
2150
510
5029
159
7849
54%
0
1351
152
1269
58
2829
39%
0
1516
173
1275
62
3026
37%
0
1681
173
1281
66
3201
36%
0
1831
173
1288
70
3362
34%
0
6379
670
5113
257
12418
36%
0
1840
188
1294
76
3398
28%
0
1991
215
1300
83
3589
28%
0
2146
215
1306
90
3757
27%
0
2315
224
1313
98
3949
26%
0
8292
843
5213
347
14694
27%
0
2514
250
1319
105
4187
26%
0
2728
260
1325
112
4425
26%
-324
-251
-216
-210
-165
-163
154
233
243
324
335
420
381
2211
2689
3199
3733
11832
5602
6161
6813
7376
25951
7973
8495
94
0.00
94
94
0.00
94
0
0.00
0
94
0.00
94
95
0.00
95
95
0.00
95
96
0.00
96
97
0.00
97
97
0.00
97
99
0.00
99
102
0.00
102
105
0.00
105
1068
0.00
1068
344
0
344
136
0
136
151
0
151
168
0
168
798
0
798
562
0
562
215
0
215
245
0
245
277
0
277
1299
0
1299
935
0
935
352
0
352
-230
0
-230
n/a
-157
0
-157
n/a
-216
0
-216
n/a
-116
0
-116
n/a
-71
0
-71
n/a
-68
0
-68
n/a
250
0
250
n/a
331
0
331
n/a
340
0
340
n/a
424
0
424
n/a
437
0
437
n/a
525
0
525
n/a
1449
0
1449
10%
2555
0
2555
35%
2825
0
2825
35%
3350
0
3350
37%
3901
0
3901
39%
12631
0
12631
37%
6164
0
6164
51%
6376
0
6376
49%
7057
0
7057
50%
7653
0
7653
51%
27251
0
27251
50%
8908
0
8908
56%
8846
0
8846
52%
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
200
200
16625
16395
0
16395
16395
16238
0
16238
16238
16022
0
16022
16022
15907
0
15907
15907
15836
0
15836
15836
15768
0
15768
15768
16018
0
16018
16018
16349
0
16349
16349
16689
0
16689
16689
17113
0
17113
17113
17550
0
17550
17550
18074
0
18074
16625
18074
0
18074
18074
20829
0
20829
20829
23654
0
23654
23654
27004
0
27004
27004
30905
0
30905
18074
30905
0
30905
30905
37069
0
37069
37069
43445
0
43445
43445
50502
0
50502
50502
58156
0
58156
30905
58156
0
58156
58156
67063
0
67063
67063
75910
0
75910

Interest income
Interest expense
NET INTEREST INCOME
INCOME BEFORE TAXES
Taxes on income
NET INCOME
% of Total Sales
GRANTS RECEIVED
Dividends Paid
Mnth
0.4%
2%
33%
Qtr
1.3%
6%
33%
Qtr
1.3%
6%
33%
Qtr
1.3%
6%
33%

Year of Operation
ASSETS
CURRENT ASSETS
A/R Opening Balance
A/R Closing Balance
2006
Jul
Aug
Sept
Oct
Nov
Dec
2007
Jan
Feb
Mar
Apr
May
June
Total
2008
Q1
Q2
Q3
Q4
Total
32523
270
1440
1440
36154
1440
1620
1620
40300
1620
1800
1800
44988
1800
1980
1980
44988
1440
1980
1980
2009
Q1
Q2
Q3
Q4
Total
51650
1980
2400
2400
58736
2400
2600
2600
66469
2600
2800
2800
74807
2800
3000
3000
74807
2400
3000
3000
Q1
Q2
84384
3000
3200
3200
93910
3200
3400
3400
22541
75
108
108
22731
75
108
108
22846
108
126
126
23075
126
126
126
23332
126
144
144
23310
144
144
144
23851
144
203
203
24504
203
225
225
25184
225
225
225
25904
225
248
248
26680
248
248
248
27524
248
270
270
27524
108
270
270

248
22896
280
23119
318
23291
356
23556
398
23874
440
23894
485
24539
536
25264
585
25994
638
26790
691
27618
747
28541
747
28541
930
34893
1133
38907
1354
43454
1592
48561
1592
48561
1847
55898
2124
63459
2415
71684
2728
80535
2728
80535
3054
90637
3401
100711
PLANT AND EQUIPMENT

Less: (Accum. Depr)
25000
3917
21083
25000
4333
20667
25000
4750
20250
25000
5167
19833
25000
5583
19417
25250
6004
19246
25250
6425
18825
25250
6846
18404
25250
7267
17983
25250
7688
17563
25250
8108
17142
25250
8529
16721
25250
8529
16721
25375
9798
15577
25500
11073
14427
25625
12354
13271
25750
13642
12108
25750
13642
12108
25875
14935
10940
26000
16235
9765
26125
17542
8583
26250
18854
7396
26250
18854
7396
26375
20173
6202
26500
21498
5002
511
57
455
557
66
491
602
76
526
648
87
561
693
98
595
789
111
677
834
125
709
879
140
739
925
155
769
995
172
823
1041
189
851
1086
207
879
1086
207
879
1165
266
899
1244
328
916
1323
394
929
1401
464
937
1401
464
937
1522
540
982
1657
623
1034
1806
713
1092
1955
811
1144
1955
811
1144
2100
916
1184
2245
1028
1217
44434
44276
44067
43951
43886
43817
44072
44408
44747
45175
45611
46140
46140
51369
54250
57654
61606
61606
67819
74258
81360
89074
89074
98023
106930
0
39
39
0
0
39
0
38
38
0
0
38
0
45
45
0
0
45
0
44
44
0
0
44
0
50
50
0
0
50
0
49
49
0
0
49
0
54
54
0
0
54
0
59
59
0
0
59
0
58
58
0
0
58
0
63
63
0
0
63
0
62
62
0
0
62
0
66
66
0
0
66
0
66
66
0
0
66
0
540
540
0
0
540
0
596
596
0
0
596
0
650
650
0
0
650
0
701
701
0
0
701
0
701
701
0
0
701
0
750
750
0
0
750
0
813
813
0
0
813
0
858
858
0
0
858
0
919
919
0
0
919
0
919
919
0
0
919
0
960
960
0
0
960
0
1020
1020
0
0
1020
OWNERS' EQUITY
Common Stock
Retained Earnings
28000
16395
44395
28000
16238
44238
28000
16022
44022
28000
15907
43907
28000
15836
43836
28000
15768
43768
28000
16018
44018
28000
16349
44349
28000
16689
44689
28000
17113
45113
28000
17550
45550
28000
18074
46074
28000
18074
46074
30000
20829
50829
30000
23654
53654
30000
27004
57004
30000
30905
60905
30000
30905
60905
30000
37069
67069
30000
43445
73445
30000
50502
80502
30000
58156
88156
30000
58156
88156
30000
67063
97063
30000
75910
105910

Check difference
44434
0
44276
0
44067
0
43951
0
43886
0
43817
0
44072
0
44408
0
44747
0
45175
0
45611
0
46140
0
46140
0
51369
0
54250
0
57654
0
61606
0
61606
0
67819
0
74258
0
81360
0
89074
0
89074
0
98023
0
106930
0
Jan
Feb
Mar
Q1
Q2
16000
3000
3200
15800
17000
3200
3400
16800
0
3840
919
960
3799
0
4080
960
1020
4020
2514
250
145
0
0
326
125
3360
8641
2728
260
145
0
0
347
125
3605
9175
15%

Less: (Accum. Depr)
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Short term Debt
Accounts Payable
Shareholders Loans
Long Term Debt
TOTAL LIABILITIES
Year of Operation
720
75
108
687
720
108
108
720
840
108
126
822
840
126
126
840
960
126
144
942
960
144
144
960
1350
144
203
1292
1500
203
225
1478
1500
225
225
1500
1650
225
248
1628
1650
248
248
1650
1800
248
270
1778
14490
75
270
1778

SETUP COSTS
Cost of Goods Sold
CASH PURCHASES
0
390
33
39
384
0
384
39
38
385
0
448
38
45
442
0
441
45
44
442
0
496
44
50
491
0
488
50
49
489
0
540
49
54
535
0
590
54
59
585
0
580
59
58
581
0
627
58
63
622
0
616
63
62
617
0
660
62
66
656
0
6260
33
66
6227
170
58
47
25
0
33
0
333
-30
120
41
45
0
0
33
0
239
96
140
41
45
0
0
38
0
265
116
140
41
45
0
0
37
0
264
134
160
41
45
0
0
42
0
289
163
160
41
45
50
0
41
250
588
-117
180
41
45
0
0
46
0
312
444
200
41
45
0
0
50
0
337
556
200
41
45
0
0
49
0
336
583
220
41
45
25
0
53
0
385
620
220
41
45
0
0
52
0
359
674
240
41
45
0
0
56
0
383
739
2150
510
546
100
0
532
250
4089
-8538

Interest earned
Grants Received
Equity funding
94
0
0
0
94
94
0
0
0
94
0
0
0
0
0
94
0
0
0
94
95
0
0
0
95
95
0
0
0
95
96
0
0
0
96
97
0
0
0
97
97
0
0
0
97
99
0
0
0
99
102
0
0
0
102
105
0
0
0
105

Interest payable
Debt retirement
Cash Dividends
0
0
0
0
94
0
0
0
0
94
0
0
0
0
0
0
0
0
0
94
0
0
0
0
95
0
0
0
0
95
0
0
0
0
96
0
0
0
0
97
0
0
0
0
97
0
0
0
0
99
0
0
0
0
102
64
22477
22541
190
22541
22731
116
22731
22846
228
22846
23075
258
23075
23332
-22
23332
23310
540
23310
23851
653
23851
24504
680
24504
25184
720
25184
25904
776
25904
26680

Taxes payable
NET CASH FLOW

20%
10%
9%
Aug
Sept
Oct
Nov
Dec
25%
0%
2006
Jul
20%
May
June
Total
Q1
Q2
25%
0%
2007
Apr
20%
2008
Q3
Q4
Total
2009
Q1
Q2
Q3
Q4
Total
12000
1980
2400
11580
13000
2400
2600
12800
14000
2600
2800
13800
15000
2800
3000
14800
54000
1980
3000
52980
0
3000
701
750
2951
0
3250
750
813
3188
0
3430
813
858
3385
0
3675
858
919
3614
0
13355
701
919
13138
1840
188
120
0
0
255
125
2529
6100
1991
215
135
0
0
276
125
2742
6870
2146
215
149
0
0
292
125
2926
7489
2315
224
149
0
0
312
125
3125
8061
8292
843
553
0
0
1135
500
11323
28520
7200
270
1440
6030
8100
1440
1620
7920
9000
1620
1800
8820
9900
1800
1980
9720
34200
270
1980
32490
0
2160
66
540
1686
0
2385
540
596
2329
0
2600
596
650
2546
0
2805
650
701
2754
0
9950
66
701
9315
1351
152
79
0
0
184
125
1890
2454
1516
173
79
0
0
203
125
2095
3496
1681
173
79
0
0
221
125
2278
3995
1831
173
79
0
0
238
125
2446
4520
6379
670
315
0
0
846
500
8709
14466
1068
0
0
0
1068
344
200
2000
0
2544
136
0
0
0
136
151
0
0
0
151
168
0
0
0
168
798
200
2000
0
2998
562
0
0
0
562
215
0
0
0
215
245
0
0
0
245
277
0
0
0
277
1299
0
0
0
1299
935
0
0
0
935
352
0
0
0
352
0
0
0
0
105
0
0
0
0
1068
0
0
0
0
2544
0
0
0
0
136
0
0
0
0
151
0
0
0
0
168
0
0
0
0
2998
0
0
0
0
562
0
0
0
0
215
0
0
0
0
245
0
0
0
0
277
0
0
0
0
1299
0
0
0
0
935
0
0
0
0
352
844
26680
27524
-7470
22477
27524
4998
27524
32523
3632
32523
36154
4146
36154
40300
4688
40300
44988
17464
27524
44988
6662
44988
51650
7085
51650
58736
7733
58736
66469
8338
66469
74807
29819
44988
74807
9576
74807
84384
9526
84384
93910
20%
25%
9%
20%
25%
9%
20%
25%
9%
2006
Jul
2007
Aug
Sept
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
June
Total
0
25000
417
3917
21083
0
25000
417
4333
20667
0
25000
417
4750
20250
0
25000
417
5167
19833
0
25000
417
5583
19417
250
25250
421
6004
19246
0
25250
421
6425
18825
0
25250
421
6846
18404
0
25250
421
7267
17983
0
25250
421
7688
17563
0
25250
421
8108
17142
0
25250
421
8529
16721
250
250
5029
8529
-8279
R&D EXPENDITURES
Base Salary
R&D V.P
4.2
4
R&D Senior Staff
3.8
12
R&D Junior Staff
2.1
4
15%
3
24
23
47
IP Rights
25
TOTAL R&D AND INTELL. PROPERTY Mnths
72
60
511
9
57
455
4
11
4
3
23
23
45
0
45
557
9
66
491
4
11
4
3
23
23
45
0
45
602
10
76
526
4
11
4
3
23
23
45
0
45
648
11
87
561
4
11
4
3
23
23
45
0
45
693
12
98
595
4
11
4
3
23
23
45
50
95
789
13
111
677
4
11
4
3
23
23
45
0
45
834
14
125
709
4
11
4
3
23
23
45
0
45
879
15
140
739
4
11
4
3
23
23
45
0
45
925
15
155
769
4
11
4
3
23
23
45
25
70
995
17
172
823
4
11
4
3
23
23
45
0
45
1041
17
189
851
4
11
4
3
23
23
45
0
45
1086
18
207
879
50
136
50
35
271
275
546
100
646
1086
159
207
879
2008
Q1
Q2
Q3
Q4
Total
125
25375
1269
9798
15577
125
25500
1275
11073
14427
125
25625
1281
12354
13271
125
25750
1288
13642
12108
500
25750
5113
13642
12108
13
36
20
10
79
0
79
0
79
1165
58
266
899
13
36
20
10
79
0
79
0
79
1244
62
328
916
13
36
20
10
79
0
79
0
79
1323
66
394
929
13
36
20
10
79
0
79
0
79
1401
70
464
937
53
142
79
41
315
0
315
0
315
1401
257
464
937
2009
Q1
Q2
Q3
Q4
Total
125
25875
1294
14935
10940
125
26000
1300
16235
9765
125
26125
1306
17542
8583
125
26250
1313
18854
7396
500
26250
5213
18854
7396
34
50
21
16
120
0
120
0
120
1522
76
540
982
34
62
21
18
135
0
135
0
135
1657
83
623
1034
34
75
21
19
149
0
149
0
149
1806
90
713
1092
34
75
21
19
149
0
149
0
149
1955
98
811
1144
137
262
83
72
553
0
553
0
553
1955
347
811
1144
Q1
Q2
125
26375
1319
20173
6202
125
26500
1325
21498
5002
36
69
22
19
145
0
145
0
145
2100
105
916
1184
36
69
22
19
145
0
145
0
145
2245
112
1028
1217
PLANT AND EQUIPMENT

Asset Purchases
Mnths
60
Qtrs
20
Base Salary
12.6
11.3
6.3
15%
Qtrs
20
Qtrs
20
Base Salary
32.5
11.9
6.6
15%
Qtrs
Qtrs
20
Base Salary
34.1
10.9
6.9
15%
Qtrs
20

Jul Aug
Sept
Oct
Nov
2006
Jan
Dec
Feb
Mar
Apr
May
June
Total
Q1 Q2

V.P. - R&D
R&D Senior Staff
R&D Junior Staff
1
3
2
6
1
3
2
6
1
3
2
6
1
3
2
6
1
3
2
6
1
3
2
6
1
3
2
6
1
3
2
6
1
3
2
6
1
3
2
6
1
3
2
6
1
3
2
6
1
3
2
6

V.P. - Marketing
Marketing Staff
V.P. - Sales
Sales Staff
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0

CEO
CFO
COO
1
0
0
0
1
1
0
0
0
1
1
0
0
0
1
1
0
0
0
1
1
0
0
0
1
1
0
0
0
1
1
0
0
0
1
1
0
0
0
1
1
0
0
0
1
1
0
0
0
1
1
0
0
0
1
1
0
0
0
1
1
0
0
0
1

0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Base Salary
4.2
13.1
7.1
7.0
7.5
8.0
2.9
0.0
15%
4.2
32

Lease Expenses
Business Travel
% of Sales
Jul Aug
Sept
Oct
Nov
Dec
Mnt Base Salary
V.P. - Marketing
8.3
9.0
0.0
0.0
0.0
0.0
0.0
Marketing Staff
5.4
0.0
0.0
0.0
0.0
0.0
0.0
V.P. - Sales
8.3
9.0
0.0
0.0
0.0
0.0
0.0
4.2
0.0
0.0
0.0
0.0
0.0
0.0
4%
29.0
0.0
0.0
0.0
0.0
0.0
15%
3.0
0.0
0.0
0.0
0.0
0.0
50
0
0
0
0
0
Marketing Materials
20
120
120
140
140
160
160
170
120
140
140
160
160
% of Sales
24%
17%
17%
17%
17%
17%
CEO
CFO
COO
2006
Jan
Feb
Mar
Apr
May
June
2007
Q4
Q3

Total
0.0
0.0
0.0
0.0
0.0
0.0
0
180
180
13%
0.0
0.0
0.0
0.0
0.0
0.0
0
200
200
13%
0.0
0.0
0.0
0.0
0.0
0.0
0
200
200
13%
0.0
0.0
0.0
0.0
0.0
0.0
0
220
220
13%
0.0
0.0
0.0
0.0
0.0
0.0
0
220
220
13%
0.0
0.0
0.0
0.0
0.0
0.0
0
240
240
13%
9
0
9
0
29
3
50
2100
2150
15%
13.1
0.0
0.0
0.0
2.0
15
13.1
0.0
0.0
0.0
2.0
15
13.1
0.0
0.0
0.0
2.0
15
13.1
0.0
0.0
0.0
2.0
15
13.1
0.0
0.0
0.0
2.0
15
13.1
0.0
0.0
0.0
2.0
15
13.1
0.0
0.0
0.0
2.0
15
13.1
0.0
0.0
0.0
2.0
15
13.1
0.0
0.0
0.0
2.0
15
13.1
0.0
0.0
0.0
2.0
15
13.1
0.0
0.0
0.0
2.0
15
158
7
8
0
26
198
6.0
12.0
8.0
26
6.0
12.0
8.0
26
6.0
12.0
8.0
26
6.0
12.0
8.0
26
6.0
12.0
8.0
26
6.0
12.0
8.0
26
6.0
12.0
8.0
26
6.0
12.0
8.0
26
6.0
12.0
8.0
26
6.0
12.0
8.0
26
6.0
12.0
8.0
26
6.0
12.0
8.0
26
72
144
96
312
58
8.1%
41
5.7%
41
4.9%
41
4.9%
41
4.3%
41
4.3%
41
3.0%
41
2.7%
41
2.7%
41
2.5%
41
2.5%
41
2.3%
510
3.5%
18%
32%
24%
Total
Q1
Q2
1
3
3
7
1
3
3
7
1
3
3
7
1
3
3
7
1
4
3
8
1
5
3
9
1
6
3
10
1
6
3
10
1
6
3
10
1
6
3
10
1
6
3
10
1
1
1
13
16
1
1
1
15
18
1
1
1
17
20
1
1
1
18
21
1
1
1
18
21
1
2
1
4
8
1
2
1
5
9
1
2
1
6
10
1
2
1
8
12
1
2
1
8
12
1
3
1
10
15
1
3
1
15
20
1
0
0
0
1
1
1
0
0
2
1
1
0
0
2
1
1
0
0
2
1
1
0
0
2
1
1
1
1
4
1
1
1
2
5
1
1
1
2
5
1
1
1
3
6
1
1
1
3
6
1
1
1
4
7
1
1
1
5
8
24
27
29
30
30
20
23
25
28
28
32
38
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Q1 Q2
Mnt Base Salary
25.0
25
25
16.3
16
16
25.0
25
25
12.5
163
188
4%
288
324
15%
34
38
551
616
20
800
900
1351
1516
19%
19%
Base Salary
39.4
21.3
22.5
8.8
15%
2009
Q4
1
3
3
7
Total
2008
Q3
Q1 Q2
2007
Q3
Q4
Total
25
16
25
213
360
42
681
1000
1681
19%
25
16
25
225
396
44
731
1100
1831
18%
100
65
100
788
1368
158
2579
3800
6379
19%
41
0
0
0
6
48
41
21
0
0
6
69
41
21
0
0
6
69
41
21
0
0
6
69
165
64
0
0
25
254
24
48
32
104
24
48
32
104
24
48
32
104
24
48
32
104
96
192
128
416
152
2.1%
173
2.1%
173
1.9%
173
1.7%
670
2.0%
2008
Q1
Q2
Q3
Q4
Mnt Base Salary
25.0
26
26
26
26
16.3
34
34
34
34
25.0
26
26
26
26
12.5
53
63
75
100
4%
480
520
560
600
15%
21
22
24
28
640
691
746
815
20
1200
1300
1400
1500
1840
1991
2146
2315
15%
15%
15%
15%
Base Salary
41.3
21.3
22.5
8.8
188%
28%
80%
60%
2009
Total
105
137
105
290
2160
95
2892
5400
8292
15%
43
21
0
9
11
84
43
21
23
18
7
111
43
21
23
18
7
111
43
21
23
26
7
120
174
85
68
70
31
427
24
48
32
104
24
48
32
104
24
48
32
104
24
48
32
104
96
192
128
416
188
1.6%
215
1.7%
215
1.5%
224
1.5%
843
1.6%
Q1
Q2
Mnt Base Salary
27.6
28
28
17.1
51
51
27.6
28
28
13.1
131
197
4%
640
680
15%
36
45
914
1028
20
1600
1700
2514
2728
16%
16%
Base Salary
43.4
21.3
22.5
8.8
188%
38%
16%
12%
46
22
24
35
19
146
46
22
24
44
20
156
24
48
32
104
24
48
32
104
250
1.6%
260
1.5%

Year of Operation
2009
Q3
Q4

Units volume
TOTAL SALES
200
90
18000
200
100
20000
Total
200
355
71000
Unit direct cost

COST OF GOODS SOLD
% of Total Sales
GROSS PROFIT
% Gross Margin
48
4320
24%
13680
76%
48
4800
24%
15200
76%
48
17040
24%
53960
76%
OPERATING EXPENSES
Setup costs
Sales and Marketing
Depreciation of P&E
% of Total Sales
0
2898
270
1331
120
4619
26%
0
3178
280
1338
127
4923
25%
0
11319
1060
5313
464
18155
26%
9061
10277
35805
Interest income
Interest expense
NET INTEREST INCOME
391
0
391
433
0
433
2111
0
2111
INCOME BEFORE TAXES

Taxes on income
NET INCOME
% of Total Sales
9452
0
9452
53%
10711
0
10711
54%
37917
0
37917
53%
75910
85362
0
85362
85362
96072
0
96072
58156
96072
0
96072
GRANTS RECEIVED
Dividends Paid

Year of Operation
ASSETS
CURRENT ASSETS
A/R Opening Balance
A/R Closing Balance
2009
Q3
Q4
104035
3400
3600
3600
115252
3600
4000
4000
115252
3200
4000
4000

3768
111403
4176
123428
4176
123428
PLANT AND EQUIPMENT

Less: (Accum. Depr)
26625
22829
3796
26750
24167
2583
26750
24167
2583

Less: (Accum. Depr)
2390
1148
1243
2536
1274
1261
2536
1274
1261
116442
127272
127272
0
1080
1080
0
0
1080
0
1200
1200
0
0
1200
0
1200
1200
0
0
1200
OWNERS' EQUITY
Common Stock
Retained Earnings
30000
85362
115362
30000
96072
126072
30000
96072
126072

Check difference
116442
0
127272
0
127272
0
Q3
Q4
Total
18000
3400
3600
17800
20000
3600
4000
19600
71000
3000
4000
70000

SETUP COSTS
Cost of Goods Sold
CASH PURCHASES
0
4320
1020
1080
4260
0
4800
1080
1200
4680
0
17040
919
1200
16759

Taxes payable
2898
270
145
0
0
367
125
3806
9734
3178
280
145
0
0
408
125
4137
10783
11319
1060
581
0
0
1448
500
14908
38333

Interest earned
Grants Received
Equity funding
391
0
0
0
391
433
0
0
0
433
2111
0
0
0
2111

Interest payable
Debt retirement
Cash Dividends
0
0
0
0
391
0
0
0
0
433
0
0
0
0
2111
10125
93910
104035
11217
104035
115252
40445
74807
115252
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Short term Debt
Accounts Payable
Shareholders Loans
Long Term Debt
TOTAL LIABILITIES
Total

Year of Operation
NET CASH FLOW

2009

2009
Q3
Q4
125
26625
1331
22829
3796
125
26750
1338
24167
2583
Total
500
26750
5313
24167
2583
36
69
22
19
145
0
145
0
145
2390
120
1148
1243
36
69
22
19
145
0
145
0
145
2536
127
1274
1261
143
275
87
76
581
0
581
0
581
2536
464
1274
1261
PLANT AND EQUIPMENT

Asset Purchases
R&D EXPENDITURES
R&D V.P
R&D Senior Staff
R&D Junior Staff
IP Rights

2009
Q3
Q4
Total

V.P. - R&D
R&D Senior Staff
R&D Junior Staff
1
6
3
10
1
6
3
10
1
6
3
10

V.P. - Marketing
Marketing Staff
V.P. - Sales
Sales Staff
1
3
1
17
22
1
3
1
17
22
1
3
1
17
22
1
1
1
6
9
1
1
1
7
10
1
1
1
7
10
41
42
42

0
0
0
0

CEO
CFO
COO

2009
Q3
Q4
V.P. - Marketing
28
28
Marketing Staff
51
51
V.P. - Sales
28
28
223
223
720
800
49
49
TOTAL SALES & MKT SALARIES/BENEFITS 1098
1178
Marketing Materials
1800
2000
2898
3178
% of Sales
16%
16%
CEO
CFO
COO
Total
110
205
110
774
2840
179
4219
7100
11319
16%
46
22
24
53
22
166
46
22
24
61
23
176
182
89
96
193
84
644

Lease Expenses
24
Business Travel
48
32
104
24
48
32
104
96
192
128
416
280
1.4%
1060
1.5%

% of Sales
270
1.5%
Income Statement ($000s)
Year of Operation
FINANCIAL YEAR ENDING JUNE 30
1
2005
2
2006
3
2007
4
2008
5
2009
6
2010
7
2011
8
2012
9
2013

Units volume
TOTAL SALES
100
36
23390
150
105
14490
180
190
34200
200
270
54000
200
355
71000
200
400
80000
200
450
90000
200
500
100000
200
550
110000
Unit direct cost

COST OF GOODS SOLD
% of Total Sales
GROSS PROFIT
% Gross Margin
66
2524
11%
20866
89%
55
6260
43%
8230
57%
51
9950
29%
24250
71%
49
13355
25%
40645
75%
48
17040
24%
53960
76%
48
19200
24%
60800
76%
48
21600
24%
68400
76%
48
24000
24%
76000
76%
48
26400
24%
83600
76%
OPERATING EXPENSES (See schedules)

Setup costs
Sales and Marketing
Depreciation of P&E
Depreciation of R&D & IP
% of Total Sales
1000
2137
508
3500
48
7192
31%
0
2150
510
5029
159
7849
54%
0
6379
670
5113
257
12418
36%
0
8292
843
5213
347
14694
27%
0
11319
1060
5313
464
18155
26%
0
18263
12815
462
740
32280
40%
0
20848
13858
521
928
36155
40%
0
23535
14920
527
1219
40201
40%
0
26503
16061
527
1468
44559
41%
13674
381
11832
25951
35805
28520
32245
35799
39041
952
0
952
1068
0
1068
798
0
798
1299
0
1299
2111
0
2111
5763
0
5763
6395
0
6395
7503
0
7503
8761
0
8761
14625
0
14625
63%
1449
0
1449
10%
12631
0
12631
37%
27251
0
27251
50%
37917
0
37917
53%
34283
11313
22969
29%
38640
12751
25889
29%
43302
14290
29012
29%
47802
15775
32028
29%
2000
200
0
16625
0
16625
16625
18074
0
18074
18074
30905
0
30905
30905
58156
0
58156
58156
96072
0
96072
96072
119042
0
119042
119042
144931
0
144931
144931
173943
0
173943
173943
205971
0
205971
Interest income
Interest expense
NET INTEREST INCOME
INCOME BEFORE TAXES
Taxes on income
NET INCOME
% of Total Sales
GRANTS RECEIVED
Dividends Paid
5.00%
25.0%
33%
10
2014
200
600
120000
48
28800
24%
91200
76%
0
29422
17169
527
1704
48822
41%
42378
10172
0
10172
52550
17342
35209
29%
205971
241179
0
241179
Balance Sheet ($000s)
Year of Operation
ASSETS
CURRENT ASSETS
A/R Opening Balance
A/R Closing Balance
1
2005
2
2006
3
2007
4
2008
5
2009
6
2010
7
2011
8
2012
9
2013
22477
75
75
75
27524
108
270
270
44988
1440
1980
1980
74807
2400
3000
3000
115252
3200
4000
4000
127902
4000
12800
12800
150061
12800
14400
14400
175228
14400
16000
16000
203445
16000
17600
17600

215
22767
747
28541
1592
48561
2728
80535
4176
123428
5808
146510
7644
172105
9684
200912
11928
232973
PLANT AND EQUIPMENT (see schedules)

Less: (Accum. Depr)
25000
3500
21500
25250
8529
16721
25750
13642
12108
26250
18854
7396
26750
24167
2583
27250
24629
2621
27750
25150
2600
28250
25677
2573
28750
26204
2546
440
48
392
1086
207
879
1401
464
937
1955
811
1144
2536
1274
1261
3941
2014
1926
5436
2942
2493
7140
4161
2978
8853
5629
3223
44658
46140
61606
89074
127272
151058
177199
206463
238743
0
33
33
0
0
33
0
66
66
0
0
66
0
701
701
0
0
701
0
919
919
0
0
919
0
1200
1200
0
0
1200
0
2016
2016
0
0
2016
0
2268
2268
0
0
2268
0
2520
2520
0
0
2520
0
2772
2772
0
0
2772
OWNERS' EQUITY
Common Stock
Retained Earnings
28000
16625
44625
28000
18074
46074
30000
30905
60905
30000
58156
88156
30000
96072
126072
30000
119042
149042
30000
144931
174931
30000
173943
203943
30000
205971
235971
44658
46140
61606
89074
127272
151058
177199
206463
238743
16%
R&D AND INTELLECT. PROP. (See schedules)

Less: (Accum. Depr)
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Short term Debt
Accounts Payable
Shareholders Loans
Long Term Debt
TOTAL LIABILITIES
10.5%
25%
ely Scenario)
10
2014
234866
17600
19200
19200
14376
268442
29250
26731
2519
10576
7333
3242
274203
0
3024
3024
0
0
3024
30000
241179
271179
274203
Check difference

Year of Operation
Cashflow Statement ($000s)
1
2005
2
2006
3
2007
4
2008
5
2009
6
2010
7
2011
8
2012
9
2013
23390
0
75
500
14490
75
270
1778
34200
270
1980
32490
54000
1980
3000
52980
71000
3000
4000
70000
80000
4000
12800
71200
90000
12800
14400
88400
100000
14400
16000
98400
110000
16000
17600
108400
1000
2524
0
33
2491
0
6260
33
66
6227
0
9950
66
701
9315
0
13355
701
919
13138
0
17040
919
1200
16759
0
19200
1200
2016
18384
0
21600
2016
2268
21348
0
24000
2268
2520
23748
0
26400
2520
2772
26148
2137
508
390
50
0
215
25000
28299
-31290
2150
510
546
100
0
532
250
4089
-8538
6379
670
315
0
0
846
500
8709
14466
8292
843
553
0
0
1135
500
11323
28520
11319
1060
581
0
0
1448
500
14908
38333
18263
12815
1305
100
11313
1632
500
45928
6888
20848
13858
1395
100
12751
1836
500
51288
15764
23535
14920
1604
100
14290
2040
500
56989
17663
26503
16061
1613
100
15775
2244
500
62796
19456

Interest earned
Grants Received
Equity funding
952
2000
28000
0
30952
1068
0
2000
0
1068
798
200
0
0
2998
1299
0
0
0
1299
2111
0
0
0
2111
5763
0
0
0
5763
6395
0
0
0
6395
7503
0
0
0
7503
8761
0
0
0
8761

Interest payable
Debt retirement
Cash Dividends
0
0
0
0
30952
0
0
0
0
1068
0
0
0
0
2998
0
0
0
0
1299
0
0
0
0
2111
0
0
0
0
5763
0
0
0
0
6395
0
0
0
0
7503
0
0
0
0
8761
-338
0
-7470
22477
17464
27524
29819
44988
40445
74807
12650
115252
22159
127902
25166
150061
28218
175228

SETUP COSTS
Cost of Goods Sold
CASH PURCHASES
Taxes payable
NET CASH FLOW

YEAR OPENING CASH BALANCES
16%
10.5%
8.5%
ely Scenario)
10
2014
120000
17600
19200
118400
0
28800
2772
3024
28548
29422
17169
1623
100
17342
2448
500
68604
21248
10172
0
0
0
10172
0
0
0
0
10172
31421
203445
YEAR ENDING CASH BALANCES
22477
27524
44988
74807
115252
127902
150061
175228
203445

NPV and IRR from the Company's viewpoint (at time zero - Stage I financing)
ENTER the P/E ratio to be applied to Year 5 profits =>
Enter the range of discount rates to be applied
10
40%
NCF
Disc.factor
Initial Investment
0
10000
1.0000
Year 1 Net Cash Flow
1
-31290
0.7143
2
-8538
0.5102
3
14466
0.3644
4
28520
0.2603
5
38333
0.1859
Business Valuation end Yr. 5*
379167
0.1859
Net Present Values @ applied discount rate =>
*Business Value is Year 5 Net Profit After Taxes times the P/E ratio indicated above
Equity Shares and Dilution
50%
NPV
10000
-22350
-4356
5272
7424
7127
70500
73617
Initial Allocation
Stock
Percent
Issued
Share
Owner
Intellectual Property Team
Management Team
Prior Investors
Staff Equity Positions
First Round Investor
TOTALS
900,000
100,000
0
0
0
1,000,000
Disc.factor
1.0000
0.6667
0.4444
0.2963
0.1975
0.1317
0.1317
60%
NPV
10000
-20860
-3795
4286
5634
5048
49931
50245
Disc.factor
1.0000
0.6250
0.3906
0.2441
0.1526
0.0954
0.0954
First Round Equity Investment

Funds
Stock
Total
Contrib't
issued @
Stock
($000s)
$13.00
50
3,846
903,846
100
7,692
107,692
500
38,462
38,462
0
0
0
9,350
719,231
719,231
10,000
769,231 1,769,231
10000
90.00%
10.00%
0.00%
0.00%
0.00%
100.00%
NPV of Company (from above calculation) =>

($000s)
Stock Price times Stock outstanding
($000s)
(Adjust stock issue price, shown in bold in column G, until these are approximately equal)
IRR =>
NPV
10000
-19556
-3335
3532
4352
3656
36160
34808
Percent
Share
51.09%
6.09%
2.17%
0.00%
40.65%
100.00%
40%
Disc.factor
Initial Investment
Year 1 dividends?
Year 2 dividends?
Year 3 dividends?
Year 4 dividends?
Year 5 dividends?
Business Valuation end Yr. 10
(I.e. Investor's share of that)
NPV and IRR from the Investor's viewpoint =>
0
1
2
3
4
5
-9,350
0
0
0
0
0
154140
1.0000
0.7143
0.5102
0.3644
0.2603
0.1859
0.1859
50%
NPV
-9350
0
0
0
0
0
28660
1.0000
0.3333
0.1111
0.0370
0.0123
0.0041
0.0041
200.00%
NPV
10000
-10430
-949
536
352
158
1560
1227
Stock Value
Held
($000s)
11750
1400
500
0
9350
23,000
50245
23000
NPV and IRR from the External Investor's viewpoint (at time zero)
Discount rate applied
Disc.factor
Disc.factor
1.0000
0.6667
0.4444
0.2963
0.1975
0.1317
0.1317
(Adjust to drive NPV to Zero)

IRR =>
59.40%
60%
NPV
-9350
0
0
0
0
0
20298
Disc.factor
1.0000
0.6250
0.3906
0.2441
0.1526
0.0954
0.0954
NPV
-9350
0
0
0
0
0
14700
Disc.factor
1.0000
0.6274
0.3936
0.2469
0.1549
0.0972
0.0972
NPV
-9350
0
0
0
0
0
14979
41%
19310
10948
5350
5629
234866
NB: Adjust
the IRR %
until the NPV
(sum below)
is about zero.
o Zero)
DEPRECIATION SCHEDULES
PLANT AND EQUIPMENT
Asset Purchases
Asset Depreciation
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
R&D EXPENDITURES
R&D V.P
R&D Senior Staff
R&D Junior Staff
IP Rights
R&D and IP Rights
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
Yrs
5.00
Base Salary
50
45
25
15%
Yrs
5.00
2005
2006
2007
2008
2009
2010
2011
2012
2013
25000
25000
250
25250
500
25750
500
26250
500
26750
500
27250
500
27750
500
28250
500
28750
3500
5000
29
5000
50
63
5000
50
100
63
5000
50
100
100
63
12
50
100
100
100
100
21
100
100
100
100
100
27
100
100
100
100
100
27
100
100
100
100
100
3500
3500
21500
5029
8529
-8279
5113
13642
12108
5213
18854
7396
5313
24167
2583
462
24629
2621
521
25150
2600
527
25677
2573
527
26204
2546
50
90
25
25
190
200
390
50
440
440
50
136
50
35
271
275
546
100
646
1086
53
142
79
41
315
0
315
0
315
1401
137
262
83
72
553
0
553
0
553
1955
143
275
87
76
581
0
581
0
581
2536
150
284
75
76
585
720
1305
100
1405
3941
158
284
75
78
595
800
1395
100
1495
5436
166
284
75
79
604
1000
1604
100
1704
7140
174
284
75
80
613
1000
1613
100
1713
8853
48
88
71
88
129
40
88
129
63
67
88
129
63
111
73
40
129
63
111
116
281
347
811
464
1274
740
2014
48
48
159
207
257
464
58
63
111
116
281
299
928
2942
71
111
116
281
299
341
1219
4161
88
116
281
299
341
343
1468
5629
2014
500
29250
27
100
100
100
100
100
527
26731
2519
183
284
75
81
623
1000
1623
100
1723
10576
95
281
299
341
343
345
1704
7333
HUMAN RESOURCE WORKSHEET

V.P. - R&D
R&D Senior Staff
R&D Junior Staff
V.P. - Marketing
Marketing Staff
V.P. - Sales
Sales Staff
CEO
CFO
COO
15
6
15

Base
392
2005
879
2006
937
2007
1144
2008
1261
2009
1926
2010
2493
2011
2978
2012
3223
2013
1
2
1
4
1
3
2
6
1
3
3
7
1
6
3
10
1
6
3
10
1
6
3
10
1
6
3
10
1
6
3
10
1
6
3
10
1
2
1
1
5
0
0
0
0
0
1
1
1
18
21
1
2
1
8
12
1
3
1
17
22
1
27
1
67
96
1
30
1
75
107
1
33
1
83
118
1
37
1
92
131
1
1
1
4
7
1
0
0
0
1
1
1
0
0
2
1
1
1
3
6
1
1
1
7
10
1
1
1
27
30
1
1
1
30
33
1
1
1
33
36
1
1
1
37
40
16
30
28
42
136
150
164
181
5%
75
5%
5%
5%
5%
5%
5%
3242
2014
1
6
3
10
1
40
1
100
142
1
1
1
40
43
195
5%
CATEGORY EXPENSE DETAILS
1
2005

Base Salary
V.P. - Marketing
100
100
Marketing Staff
65
32.5
V.P. - Sales
100
25
50
137.5
4%
935.6
15%
186
1416.6
Marketing Materials
20
720
2136.6
% of Sales
n/a
n/a
2
2006
3
2007
4
2008
5
2009
6
2010
7
2011
8
2012
9
2013
9
0
9
0
29
3
50
2100
2150
100
65
100
787.5
1368
158
2578.5
3800
6378.5
19%
105
137
105
290
2160
95
2892
5400
8292
15%
110
205
110
774
2840
179
4219
7100
11319
0
116
2032
116
3878
3200
921
10263
8000
18263
23%
122
2370
122
4558
3600
1076
11848
9000
20848
23%
128
2738
128
5297
4000
1244
13535
10000
23535
24%
134
3223
134
6164
4400
1448
15503
11000
26503
24%
GEN & ADMIN. SALARIES/BENEFITS Base Salary

CEO
50
CFO
85
COO
90
35
15%
150
43
23
96
23
334
158
7
8
0
26
198
165
64
0
0
25
254
174
85
68
70
31
427
182
89
96
193
84
644
191
94
101
1149
230
1765
201
99
106
1340
262
2008
211
104
111
1548
296
2270
222
109
117
1822
341
2611

Lease Expenses (as % of Plant & Equip)
20%
Business Travel
4%
3%
36
90
48
174
72
144
96
312
96
192
128
416
96
192
128
416
96
192
128
416
5450
3200
2400
11050
5550
3600
2700
11850
5650
4000
3000
12650
5750
4400
3300
13450
510
670
2%
843
0
1060
0
12815
16%
13858
15%
14920
15%
16061
15%

% of Sales
508
n/a
n/a
10
2014
141
3658
141
7036
4800
1646
17422
12000
29422
25%
233
114
123
2068
381
2919
5850
4800
3600
14250
17169
14%
NPV and IRR from the Company's viewpoint (start of year 2 - Stage II financing)
P/E ratio applied to Year 6 profits =>
10
40%
NCF
Disc.factor
50%
NPV
New Equity Investment

0
-2000
1.0000
-2000
1
-8538
0.7143
-6099
2
14466
0.5102
7381
3
28520
0.3644
10394
4
38333
0.2603
9978
5
6888
0.1859
1281
Business Valuation end year 6*
229693
0.1859
42708
63642

Owner
First Round Equity Investment

Stock
Percent
Issued
Share

Management Team
Prior Investors
TOTALS
903,846
107,692
38,462
0
719,231
1,769,231
51.09%
6.09%
2.17%
0.00%
40.65%
100.00%

(Adjust stock issue price, in column G, until these are approximately equal)
($000s)
($000s)
Disc.factor
1.0000
0.6667
0.4444
0.2963
0.1975
0.1317
0.1317
Internal Rate of Return (IRR)

(Adjust to drive NPV to zero)
IRR =>
131.19%
60%
NPV
-2000
-5692
6429
8450
7572
907
30248
45914
Disc.factor
1.0000
0.6250
0.3906
0.2441
0.1526
0.0954
0.0954
Second Round Equity Investment

Funds
Stock
Total
Contrib't
issued @
Stock
($000s)
$18.50
50
2,703
906,549
50
2,703
110,395
400
21,622
60,083
0
0
0
1,500
81,081
800,312
2,000
108,108 1,877,339
45914 Additional Allocated =
34731
NPV
-2000
-5336
5651
6963
5849
657
21905
33688
Percent
Share
48.29%
5.88%
3.20%
0.00%
42.63%
100.00%
Initial Investment
0
Year 2 dividends?
1
Year 3 dividends?
2
Year 4 dividends?
3
Year 5 dividends?
4
Year 6 dividends?
5
1.98%
40%
NCF
Disc.factor
-1,500
1.0000
0
0.7143
0
0.5102
0
0.3644
0
0.2603
0
0.1859
4543
0.1859
50%
NPV
-1500
0
0
0
0
0
845
-655
Disc.factor
1.0000
0.6667
0.4444
0.2963
0.1975
0.1317
0.1317
-1500
0
0
0
0
0
598
-902
Disc.factor
1.0000
0.6250
0.3906
0.2441
0.1526
0.0954
0.0954
NPV
-2000
-3693
2706
2308
1342
104
3478
4245
Stock Value
Held
($000s)
16,771
2,042
1,112
0
14,806
34,731

IRR =>
62.10%
60%
NPV
1.0000
0.4325
0.1871
0.0809
0.0350
0.0151
0.0151
1.98%
NPV and IRR from the External Investor's viewpoint (at start of year 2)
Disc.factor
NPV
-1500
0
0
0
0
0
433
-1067
Disc.factor
1.0000
0.6169
0.3806
0.2348
0.1448
0.0893
0.0893
NPV
-1500
0
0
0
0
0
406
-1094
NPV and IRR from the Company's viewpoint (start of year 3 - Stage III financing)
P/E ratio applied to Year 7 profits =>
10
40%
NCF
Disc.factor
50%
NPV
Initial Investment
0
0
1.0000
0
1
14466
0.7143
10333
2
28520
0.5102
14551
3
38333
0.3644
13970
4
6888
0.2603
1793
5
15764
0.1859
2931
Business Valuation end Year 7*
258889
0.1859
48136
91714

Owner
Second Round Equity Investment

Stock
Percent
Issued
Share

Management Team
Prior Investors
TOTALS
906,549
110,395
60,083
0
800,312
1,877,339
48.29%
5.88%
3.20%
0.00%
42.63%
100.00%

(Adjust stock issue price, in column G, until these are approximately equal)
($000s)
($000s)
Disc.factor
1.0000
0.6667
0.4444
0.2963
0.1975
0.1317
0.1317
Internal Rate of Return (IRR)

(Adjust to drive NPV to zero)
IRR =>
523.00%
60%
NPV
0
9644
12676
11358
1361
2076
34092
71206
Disc.factor
1.0000
0.6250
0.3906
0.2441
0.1526
0.0954
0.0954
NPV
0
9041
11141
9359
1051
1503
24690
56784
Initial Investment
0
Year 3 dividends?
1
Year 4 dividends?
2
Year 5 dividends?
3
Year 6 dividends?
4
Year 7 dividends?
5
2.59%
40%
NCF
-1,500
0
0
0
0
0
6705
Disc.factor
18374 Additional Allocated =

24997
1.0000
0.7143
0.5102
0.3644
0.2603
0.1859
0.1859
50%
NPV
-1500
0
0
0
0
0
1247
-253
1.0000
0.1605
0.0258
0.0041
0.0007
0.0001
0.0001
NPV
0
2322
735
159
5
2
28
3249
Third Round Equity Investment

Funds
Stock
Total
Percent Stock Value
Contrib'd issued @
Stock
Share
Held
($000s)
$12.25
($000s)
50
4,082
910,630
44.63%
11,155
50
4,082
114,477
5.61%
1,402
400
32,653
92,736
4.54%
1,136
0
0
0
0.00%
0
1,500
122,449
922,761
45.22%
11,304
2,000
163,265 2,040,604
100.00%
24,997
2.59%
NPV and IRR from the External Investor's viewpoint (at start of year 3)
Disc.factor
Disc.factor
1.0000
0.6667
0.4444
0.2963
0.1975
0.1317
0.1317

IRR =>
58.00%
60%
NPV
-1500
0
0
0
0
0
883
-617
Disc.factor
1.0000
0.6250
0.3906
0.2441
0.1526
0.0954
0.0954
NPV
-1500
0
0
0
0
0
639
-861
Disc.factor
1.0000
0.6329
0.4006
0.2535
0.1605
0.1016
0.1016
NPV
-1500
0
0
0
0
0
681
-819

250000
Revenue
Net Income
Cash Balances
$$$ (000s)
200000
150000
100000
50000
0
2005
Year
Revenue
Net Income
Cash Balances
2006
1
2005
23390
14625
22477
2007
2
2006
14490
1449
27524
2008
3
2007
34200
12631
44988
2009Year2010
4
2008
54000
27251
74807
5
2009
71000
37917
115252
2011
2012
2013
2014
6
2010
80000
22969
127902
7
2011
90000
25889
150061
8
2012
100000
29012
175228
9
2013
110000
32028
203445
10
2014
120000
35209
234866

Financial Summary Years 1 - 5
140000
Sales Revenue
120000
Net Income
Cash Balances
100000
80000
60000
40000
20000
0
1
Sales Revenue
Net Income
Cash Balances
2005
23390
14625
22477
2006
14490
1449
27524
2007
34200
12631
44988
5
2008
54000
27251
74807
2009
71000
37917
115252
Assumptions underlying your financial model

NOTE: This sheet is for illustrative purposes only and is not connected to the other sheets.
You should set up the details you need for your particular business situation and then link it
to Sheet 1 'Yr 1-5 details'.
The assumptions underlying your cost and revenue data should be transparent to allow the reader
to understand the basis for your financial projections. It is also convenient for you to do 'what if?'
analysis - to examine the impacts of differing assumptions for different scenarios, and to conduct
sensitivity analysis of the assumptions used.
For example:
Price per unit
Cost of Goods Sold
Most-likely scenario
Most-likely scenario
$5
$2
Worst-case scenario
Worst-case scenario
$4
$3
If your business has multiple product lines, you will need to set up a sheet something like this to
show the price and quantity demanded for each product line and the way in which each changes
as the business begins to grow.
Following is an example of what you might wish to set up and connect into the Yr 1-5 details.
PRICES
Product #
1
2
3
4
Jan
Feb
Mar
Apr
May
Jun
Jul
Product name
Radios
12
12
12
15
15
15
TVs
300
300
350
350
400
400
Computers
1500
1500
1500
1800
1800
1800
Licence fees
20
20
20
20
20
20
15
400
2000
20
VOLUMES
1 Radios
2 TVs
3 Computers
4 Licence fees
5
1
1
0
12
1
1
0
22
2
1
0
34
3
2
1
48
5
2
3
64
8
2
7
84
12
2
12
REVENUES
1 Radios
2 TVs
3 Computers
4 Licence fees
60
300
1500
0
144
300
1500
0
264
700
1500
0
510
1050
3600
20
720
2000
3600
60
960
3200
3600
140
1260
4800
4000
240
SALES REVENUES
1860
1944
2464
5180
6380
7900
10300
You can then link these aggregated Sales revenue numbers into the 'Yr 1-5 details' spreadsheet
RRR
A
1
2
3
4
5
6
7
8
9
10
11
The Investors Required Rate of Return

The investor might have a 'hurdle' condition before investing in your venture. That is, he/she might say "I want
at least X times my money back in Y years" or alternatively, "I want to own at least X percent of the shares of
the business in return for my investment of Y dollars".
To negotiate successfully with such investors, it is useful to know what these statements mean, in terms of the
investor's minimum Internal Rate of Return (IRR) requirement, and how these hurdle rates depend on the P/E
(Price/Earnings) ratio assumed. P/E is the ratio of the 'price' of the company (the stock price multiplied by
the number of shares issued) to the 'earnings' (net profit in the most recent year).
12 The Required Rate of Return embodied in the Investment Multiple

13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
The following table shows the Internal Rate of Return (IRR) that the investment would need to generate to
allow the investor to obtain specific investment multiples upon exit in N years.
"Times my Money Back" Multiples
Years (N)
1
2
3
4
5
6
7
8
9
10
Double
100.00%
41.50%
26.00%
19.90%
14.90%
12.30%
10.40%
9.10%
8.00%
7.20%
3 times
200.00%
73.30%
44.30%
31.70%
24.60%
20.10%
17.00%
14.75%
13.00%
11.60%
4 times
5 times
300.00%
100.00%
58.80%
41.50%
32.00%
26.00%
21.90%
18.95%
16.65%
14.80%
6 times
400.00%
124.00%
71.00%
49.60%
38.00%
30.80%
25.80%
22.30%
19.60%
17.47%
7 times
500.00%
145.00%
82.00%
57.00%
43.10%
34.80%
29.20%
25.12%
22.05%
19.64%
600.00%
165.00%
91.00%
63.00%
47.60%
38.30%
32.10%
27.55%
24.15%
21.48%
8 times
700.00%
183.00%
100.00%
68.00%
51.54%
41.40%
34.60%
29.70%
26.00%
23.10%
9 times
10 times
800.00%
200.00%
108.00%
74.00%
55.20%
44.20%
36.90%
31.62%
27.65%
24.60%
900.00%
216.00%
116.00%
78.00%
58.50%
46.80%
38.95%
33.34%
29.15%
25.90%
For example, an investor demanding 8 times his/her money back in 5 years, is effectively demanding 51.54%
compound annual return on his/her money over that period.
The Investor's Investment Multiple in terms of Equity Share.

If the investor contributes =>
1000 ($000s)
and wants the following multiple =>
12 (times) his/her money back upon exit in N years
the proportion (share) of the firm's equity the investor would need to own is given in the table below:
For P/E ratio =>
2
Year (N) Profits ($000s)
3
2,500
240.00%
4
4,000
150.00%
5
7,000
85.71%
10
12
14
16
120.00%
75.00%
42.86%
80.00%
50.00%
28.57%
60.00%
37.50%
21.43%
48.00%
30.00%
17.14%
40.00%
25.00%
14.29%
34.29%
21.43%
12.24%
30.00%
18.75%
10.71%
Often a disagreement with a Venture Capitalist over the share of the business he/she should get, boils down to
a disagreement over either a) the appropriate P/E ratio to apply to the profits in the year the investor wants to
exit, or (b) the dispute might be with the discount rate applied to the projected profits, or c) with the revenue
stream assumed, or (d) with the costs/expenses assumed, or e) with the time horizon chosen for inclusion
in the financial analysis, or some combination.
To reach agreement, the parties have to reach agreement on these five values.
The Investor's Required Share of Ownership under various RRR and P/E Scenarios
53
Page 37
RRR
A
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
Assumptions:
Investment made ($000s) =>
Year (N) Net Profit ($000s) =>
Payback desired end of year N =>
Approximate investment multiple

desired after 3 years =>
Approximate investment multiple
desired after 5 years =>
P/E ratio
2
The numbers in the
4
body of the table are
6
the percentage of
8
the firm's stock the
10
investor must hold
12
to achieve the RRR
14
desired, given the
16
P/E applied, the
18
initial investment, &
20
the year N profits.
22
1000
2500
5
Required Rate of Return
40%
50%
20%
30%
60%
70%
80%
1.5
2.0
2.7
3.4
4.2
4.9
5.9
2.4
3.8
5.6
7.8
10.3
13.0
16.0
49.77%
24.88%
16.59%
12.44%
9.95%
8.29%
7.11%
6.22%
5.53%
4.98%
4.52%
74.26%
37.13%
24.75%
18.56%
14.85%
12.38%
10.61%
9.28%
8.25%
7.43%
6.75%
107.56%
53.78%
35.85%
26.89%
21.51%
17.93%
15.37%
13.45%
11.95%
10.76%
9.78%
151.88%
75.94%
50.63%
37.97%
30.38%
25.31%
21.70%
18.98%
16.88%
15.19%
13.81%
209.72%
104.86%
69.91%
52.43%
41.94%
34.95%
29.96%
26.21%
23.30%
20.97%
19.07%
283.97%
141.99%
94.66%
70.99%
56.79%
47.33%
40.57%
35.50%
31.55%
28.40%
25.82%
377.91%
188.96%
125.97%
94.48%
75.58%
62.99%
53.99%
47.24%
41.99%
37.79%
34.36%
Page 38

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INSTRUCTIONS - How to use NVFinPak

Insert Company name here

Income Statement (000s)

(Most Likely Scenario)

Financial Year ending June 30

Price/unit (net of discounts)

Unit direct cost

Insert Company name here

Balance Sheet (000s)

(Most Likely Scenario)

INVENTORY (% of Cost of Goods Sold)

PLANT AND EQUIPMENT

TOTAL LIABILITIES & EQUITY

R&D AND INTELLECT. PROP.

Insert Company name here

Cashflow Statement (000s)

(Most Likely Scenario)

CASH INFLOW FROM FINANCING

CASH OUTFLOW FROM FINANCING

NET CASH FLOW

CASH OUTFLOW FROM OPERATIONS

Insert Company name here

(Most Likely Scenario)

PLANT AND EQUIPMENT

Insert Company name here

Human Resource Worksheet

(Most Likely Scenario)

RESEARCH AND DEVELOPMENT

SALES & MARKETING STAFF

GENERAL & ADMINISTRATIVE STAFF

TOTAL STAFF PROJECTIONS

SALARY RELATED ISSUES

Insert Company name here

Category Expense Details

MISCELLANEOUS GEN & ADMIN EXPENSE

(Most Likely Scenario)

Insert Company name here

Income Statement (000s)

(Most Likely Scenario)

Income Statement (000s)

Financial Year ending June 30

Price/unit (net of discounts)

(Most Likely Scenario)

Unit direct cost

INCOME BEFORE INTEREST & TAXES

Insert Company name here

Balance Sheet (000s)

(Most Likely Scenario)

Balance Sheet (000s)

(Most Likely Scenario)

INVENTORY (% of Cost of Goods Sold)

PLANT AND EQUIPMENT

TOTAL LIABILITIES & EQUITY

R&D AND INTELLECT. PROP.

Insert Company name here

Cashflow Statement (000s)

(Most Likely Scenario)

CASH OUTFLOW FROM OPERATIONS

CASH INFLOW FROM FINANCING

CASH OUTFLOW FROM FINANCING

Sales & Marketing Expenses

NET CASH FLOW

Cashflow Statement (000s)