To complete our cash flow statement for the sub period we're working in the Deal_Date tab and in column I, this starts with EBITDA. We can find that further up the page in our income statement. So scroll up, up up up up, and we find 56.1. As we've started with EBITDA we then want to start taking off the other items such as interest tax, et cetera, that are cash flows. It's very important to show all of your interest calculations in an LBO because they are very large cash flows in themselves. So press equals, and I go up to my income statements, but I find that we don't have any, so we're going to link to these blank cells so that when the debt schedule is completed the figures just flow through. The historical net finance charges first. Then we move onto interest on the revolving credit facility.

You might notice we've missed out amortization of original issuer discount. That's not a cash flow hence it doesn't go through the cash flow statements. I can copy that formula down all the way down to high yield. Let's just check that's coming from the right place, and it is, interest on high yield.

Interesting though, let's link up to that separately and then to the tax expense. (keyboard clacking) We now need to go through the various balance sheet items looking for any cash flows here. Our first one is other long-term assets. So I take last year minus this year. (keyboard clacking) I then move on to other long-term liabilities and I take this year minus the last. (mouse clicking) (keyboard clacking) I then need to do something similar for each of the other items. Next we go to receivables. I take last year minus this year, and you might notice other current assets is directly underneath so I can copy that down one row in the cash flow statement as well. Payables, I can do something similar. We find that our payables is right next to the other current liabilities, so this minus the last and then I can copy that down other current liabilities. That gets us through cash flow from operations. Our only cash flow from investing activities is CapEx. That's above the income statements in the calculation section.

I need to make sure that's a negative because it's an expenditure and outflow of cash. (keyboard clacking) Now we come onto the increase or decrease in debt items. We start by looking at the revolving credit facility and if we look at our revolving credit facility, it was 20, but we now have a blank cell. I am going to link those blank cells up. So I take this year minus the previous period. It will initially look like we've paid off the revolving credit facility, but once the debt schedule's done and this figure is filled in for this period's folding credit facility, the correct number will then flow through our cash flow statements. So we're setting up the cash flow statement for later on, as and when the model is finished. (keyboard clacking) I do exactly the same for my long-term debts.

This period minus the last and I can copy that all the way down to mezzanine. Let's just check that that's coming from the right place, and it is. (keyboard clacking) Dividends are just below the income statements, (keyboard clacking) and that gets us our cash flow from financing activities. So we're almost at the end now. I need to find my ending cash, the last period, start with that. That becomes my beginning cash for the next period. And my next cash flow is the sum of cash flow from operations, investing and financing. (keyboard clacking) If I sum those up, I started with 30 then had a big outflow, that's all of the debt, at the moment it looks like it's been paid off, getting us down to 1259.7. Now in theory, I should be able to now take that to the balance sheet and I might expect it to balance, but let's see what happens.

So I go to my balance sheet cash and press equal, link down to the bottom of my cash flow statement, the 1259.7, great. So cash at the moment looking very, very negative. That's a slightly silly number to have in there. Once debt's filled in that will sort itself out. But let's see what's happened to the balance sheet check. The balance sheet check is unbalanced by 12. Now that's slightly unusual, at this point in building a normal three statement model that would balance, so why is it unbalanced? Well, it's suspiciously similar to the unamortized debt issuance fees. What's going on? At the moment it looks like the unamortized debt issuance fees balance has gone. So that 12 you would expect to be going through the cash flow statements, but because this is the amortization of debt issuance fees that will be happening over time that's not flowing through our cash flow statements. So because it is being reduced to zero here but there's no cash impact happening in the cash flow statement, at the moment we're unbalanced. What will happen later on is that that amortization will flow through the income statement, through one of the interest lines. Therefore it will balance later on. So that gets us through our cash flow statement. We're unbalanced in the balance sheet by 12, but that's okay.