Although it feels our model is complete because it's balancing, there are several areas still missing. The first of which is interest. We are going to model interest using an average balance. We're going to go and grab the average of the short term debt from the beginning of the period and the end of the period because the average will be the interest bearing element throughout that period as we pay it off. We're then going to multiply that by the short term debt percentage rate and then I'd like that as a negative figure. We're going to perform that again for long-term debt and cash, which you can see I've done with the video paused.

You can see as we pay off our short-term debt, the interest goes away and as we start to get control and accumulate cash, our interest on cash goes up. We're starting to see that the interest on the long-term debt and the long-term debt as a whole is very high. And later we'll see through metrics that that is certainly the case.

We're now going to go back to the P&L and fill in one of the last blanks, which is the net financial expenses.

We are going to build a switch protected line here and we're going to say if switch, which is a named cell is 1, then sum up all of the interest that we've just calculated, otherwise, resolve it as a zero. If we enter there, you can see that it's resolving as a zero. And the reason is that we have a named cell called switch over here in the info tab and we keep that off while we're building because we don't want the model to see circularity when we go into the options formulas. We should really be building with iterative calculations switched off.

The reason is if I make an error while I'm building and I'm just going to create an error here just for the sake of it. So say I create a sum and then add the sum to itself. Excel will give me a really good warning if iteration is switched off and if Excel has seen no other circularity.

Now had this been on and Excel would see the circularity warned me, but then no longer warned me about subsequent problems. So it's safer to hide this line from Excel while we're building.

We would copy it to the right and if we're, we are ready to stop building, we would then turn on iteration, flip the switch, and now we have a circular model. And the reason it's circular is because these interest charges are going to end up in net income. Net income is going to influence the cashflow statement. The cashflow statement will influence the short term debt and the short term debt will influence the interest. So we have a circular model here that is modeling over and over again iteratively with high accuracy.

If we were going to keep building, which I am, we would now want to hide that from Excel again. So we would turn the switch to zero, we would then turn iteration off, and we would now be in a state where if we by accident created a circularity, Excel would give us a really good overt warning. So this is a clean way to build Excel circularity.