Accounting for Modelers · Statements
Debt Schedules & Circular References
Modeling debt tranches: revolvers, term loans, mandatory amortization, cash sweeps, and interest. Why interest on average balances creates a circular reference, and how to handle it with iterative calculation and a circuit breaker.
Step 1 of 6 · Overview30 min read ·
Key idea
Prereqs: Forecasting drivers. Next: LBO models; Credit analysis. Sources: Breaking Into Wall Street and Wall Street Prep debt-schedule tutorials; Rosenbaum & Pearl, *Investment Banking* ch. 4–5.Next: 1. Tranches