Fiches finance internationale

FICHES DE REVISIONS PARTIELS FINANCE :

Depreciation per year = Purchase value – residual value

                                Life of the asset

Amortizable basis = Purchase value – Residual value

Concerning Working Capital Requirements =

2 Ways to calculate Working Capital Requirements =

• As a percentage of sales or operating incomes
• With the following formule

Working Capital Requirements = Inventories     +     Receivables        –       Payables

                                                (stocks)        (créances clients)    (dettes d’exploitation)

Working Capital Variations = Working capital requirements – Working Capital Requirements

                                        in N                                        in N-1

Net income statement =

Sales (turnover) – Cannibalization costs on sales

= Sales after cannibalization costs

Sales after cannibalization costs – (Operating expenses – Cannibalization costs on expenses) – Fixed operating charges (for instances = rents, depreciations, etc…)

= Pre-tax Profit

Then to calculate Net income =

Net income = Pre-tax Profit – Corporate tax

                      = Pre-tax Profit – 1/3 Pre-tax profit

                 = 2/3 Pre-tax profit

Cash flow table = - I0 = dépense d’investissement

Fixed Asset Investment = - Purchase cost of the asset (to write as of year 0)

Fixed Asset Sales = Residual value to be written for final year

Adjustment for use of existing machine =

to write in year 0 = - (market value of existing machine as of year 0 – tax rate x (market value                           of existing machine as of year 0 – book value of existing machine))

to write as of final year = (market value of existing machine as of final year – tax rate x (market value of existing machine as of year N – book value of existing machine)).        

Total initial investment = 

Fixed Asset investment + Adjustment for the use of existing machine + other investment expenses  + initial working capital requirements 🡪 For year 0

Free Cash Flow for the other years before excluding final year =

Operating revenues after cannibalization – Operating expenses after cannibalization – Fixed operating expenses – Corporate taxes

Free Cash Flow for the final year =

Fixed asset sales + Adjustment for the use of existing machine + Operating revenues after cannibalization – Operating expenses after cannibalization – Fixed operating expenses – Corporate taxes

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