In this model, we need to consolidate and acquirer and target balance sheets at the deal date.

Here we've got a balance sheet for the acquirer already, and underneath that we've got a balance sheet for the target.

Now you might notice that the year end for the target is June and the year end for the acquirer is June as well.

So we've already ized the targets figures underneath this.

We are going to calculate the roll forward percentage and the stop percentage and then we'll put all of that into our consolidated balance sheet here.

Let's set up the consolidated balance sheet.

So I'm going to sum the acquirers, figure, the targets figure and any transaction effects.

I'll then copy that down to each of the individual line items and then total upwards total assets and total liabilities and equity.

Don't worry that it doesn't balance at the moment.

We can just see that there's been a debt issuance to pay for the company of 400.

So let's go back up again.

The first thing we need to do is work out our roll forward and our stub periods.

We can see the deal dates happened on the 30th of April 20, and if we go back up We can see that that's edging towards the end of the year in a June to junior.

That's edging towards the end.

So I start by noting down the acquirer's previous year end.

That is the 30th of June 19.

The acquirer's next year end is the 30th of June 20.

Now my roll forward period is the distance between the 30th of June 19 and the 30th of April 20.

So I take 30th of April 20 minus the 30th of June 19, and then divide that by the number of days in the period by taking 30th of June 20 minus 30th of June 19, and that gets me 83.3%.

My stub period is one minus the 83%, so let's make sure that makes sense.

If the deal date is heavily towards the 30th of June 20, then we're going to have our cash figure come through quite close to 182, not close to 117.

Let's use those figures then.

So cash of the acquirer to start off with, I want 117.

I then want to multiply that by 16.7%.

I'm gonna lock that add on cash from next year, and I want a higher figure.

I want to times that by the 83.3%.

Great, and it does get me a figure towards the high end.

I can now copy that down into the individual line items and then total upwards.

Just make sure my balance sheet balances. It does 1013 and 1013.

I'm gonna copy those subtotals into the target.

We now do the same for the target cash.

I go back to last year's cash and I multiply that by the 16%.

I then add onto that next year's cash and multiply that by the 83% and that should be weighted towards that end.

I'm just gonna make sure I lock both of those percentages and it is weighted towards the high end.

Copy those down. And I now have a balanced target balance sheet and a balance acQuire's balance sheet.

The only thing that's not balancing is my combo balance sheet.

We've paid 400 for the company.

We now need to zero out the target equity 'cause we rip up those shares.

And because we've paid a premium over book value that creates goodwill and we'll put that into other assets.

My combo balance sheet now bounces and I've got an acquirer's balance sheet and a targets balance sheet at the deal date.