When inserting a new item into a model it's going to make your life much easier if you can predict those changes before you actually do them. So planning is the name of the game. Let's have a look at an example. Let's say we wanted to insert a new debt tranche into a model. Well first I might look at the assumption section, I'd plan to do a new debt issuance or repayment line and I need a separate new interest rate line as well. So now when I actually come to do the assumptions I can insert two new lines. On the balance sheets, I'd want to consider having a new debtline in here as well. I could of course incorporate them into the existing line items for debt. On my debt schedule I want a new debt section, so I'll need new rows for beginning balance. Issuance will repayments ending balance and the interest expense on all of that. If your debt schedule has a cash sweep, you'll have to update that cash sweep so that you can calculate cash available for any other debt items that are more junior.

On the cash flow statement you'll also want to consider having a new debt line here as well or you could incorporate it into an existing line item such as change in debt. Lastly on your income statements, you will consider having a new interest line here or incorporate it into the existing interest expense line. So the process of inserting a new item will start with predicting where the changes are needed and then you put those predictions into effect. You start inserting those new rows, maybe an assumptions, calculations, financial statements and in the outputs. You have to make sure that you label these new items clearly and consistently. So for instance if I'm putting new debt into my model in my assumptions, I might call it debt tranche 2 issuance will repayment, debt tranche 2 interest. Then when I come to my debt schedule, I want to have debt tranche 2 beginning balance, debt tranche 2 issuance, debt tranche ending balance so that anybody inheriting your model can clearly work out where these figures are coming from. Normally we say that new items should get new rows where possible. We try not to add them on to another formula. If I was looking to put new debt into a model, it'd be very easy to be a nice shortcut just to put that into my balance sheets debt line item. I wouldn't have to update any subtotal. The only downside here is that if anyone inherits your model, they might not realize that there are two debt items within that debt line item. So there is a fine balance here between shortcuts and ease of building your model, but also ease of understanding usually more line items and more labeled make it easier to audit. Lastly, we only add one new item at a time. If I've got three things I want to change maybe the debts maybe the pp&e and lastly intangibles. I would do all of my debt changes first check that the model is working fine. Then I would move on to the PPE make sure that's working fine. And only then will I move on to the intangibles.