FAT Upgrades since last Version 2.04

  1. The FAT is no longer separated into two different files. In version 3.00, the user can upgrade to Advanced from Basic by clicking on the Upgrade button on the Main tab. The differences between the two versions are shown on the Features Page. Both old Basic and Advanced files will remain usable, though old Advanced files require an Advanced license rather than Basic license to open.
  2. The Import Pratt’s Stats functions have been updated to reflect Pratt’s Stats new data format. For data older than January 2016, use the Import Pratt’s Stats (Old) function with Method A. Data compiled prior to January 2016 is no longer supported for Pratt’s Stats method B.
  3. The Import Pratt’s Stats function now also work with PeerComps data. The user should be sure to interpret output statistics correctly as no summary statistics of net working capital are provided in the data, skewing Share sale data.
  4. Corporate Tax brackets are now available for all Canadian provinces and are accurate as of January 2016. This is toggled on the MPSP Input page.
  5. Capital Expenditure can now be toggled manually for future projections, affecting the DCF method.
  6. A Revenue Projections worksheet has been added to the FAT. This worksheet is available to Advanced users. Geometric and average growth can be calculated backwards for up to 15 years.
  7. Bug Fix – Net Working Capital Calculations on the NWC Calculator sheet were incorrectly based on an average of rates, rather than an average of NWC calculated from those rates. This error has been corrected.
  8. Bug Fix – Estimated Taxes on the Free Cash Flow work sheet were calculated at the marginal rather than the average tax rate calculated based on the tax regime on the MPSP Input tab. This has been corrected.
  9. The extended breakdown worksheet now rolls forward when the Add New Year function is executed.

FAT upgrades since the last Version 1.0 release to Version 2.0 August 2011

  1. The Import function has been updated. Users will now be able to import the FAT Version 1.0 and Version 1.03 into the new version. To minimize the import time, the data from Pratt Stats worksheets will not be imported into the new version.
  2. The option of “Exit after 5 years at manual multiple” has been fixed and updated. In previous versions, the selling price in the exit year can only be projected based on the Earning multiple. The calculation of estimated purchase price did not take into consideration the available Debt financing. In this version, more valuation multiples are available for analysts to derive the estimated transaction price after a five year holding period.
  3. The Capitalized Excess Earning Method has been fixed and updated. The Implied Taxed Rate and Growth Rate of excess earning are added into the calculation of Weighted Required Rate of Return on Tangible Assets.
  4. The Amortization section in the “MPSP Input” worksheet has been updated. The option for amortizing capital assets by using Straight Line Amortization method has been added. In the previous version, only Declining Balance method is available. Now, analysts have the option to amortize the fixed asset based on an estimated average asset life.
  5. The analyst is now able to project CAPEX under DCF method based on Revenue.
  6. Under the Amortization section in the “MPSP Input” worksheet, two options (Straight Line method and No Amortization) have been added for Goodwill Amortization and one option (No Amortization) has been added for the amortization of Acquisition Cost.
  7. Under the Expected ROIC section in the “MPSP Input” worksheet, users now have the option to use WACC as a discount rate for DCF method. By using WACC, the DCF will automatically change the cash flow calculation from the FCFE to FCFF. Moreover, a WACC calculator is designed for the analyst to calculate the WACC.
  8. In the “Buyer’s Opening BS”, a “FMV Adjustment factor” has been added under the “FF&E and Capital Assets” section. This factor will adjust the BV of transferred fixed assets to FMV in an Asset Sale.
  9. In calculating the goodwill in the DCF method, Debt financing is added into the calculation of the purchase price deriving solely from the DCF method.
  10. Bug fixes under “Pratt Stats A” and “Pratt Stats B” worksheets. The “Inventory” value of each precedent transaction is now imported from the “Inventory” column in the Excel file exported from Pratt Stats Database instead of “Cash and Cash Equivalent” column.
  11. The “Extended Breakdown” worksheet has been revised. A projection model is added so that a detailed analysis and projection of Sales and Cost of Sales is now possible, and the result can be used as an input under the “Input- Projections” worksheet.
  12. The user is now required to input the “Latest Update Date” and “Updated By” information in order to complete the FAT in the “Main Page”. A warning sign will show up if these information are missing.
  13. Changed the name of the “Buyer’s Closing BS” to “Transferred Closing BS” to reflect the expected Transferred Balance Sheet for the Buyer as at Closing Date.
  14. In order to minimize the redundant and overlapped information in the FAT, the “Revenue Allocation” worksheet is combined with the “Growth Allocation”. “Buyer’s Projected BS”, “Buyer’s Projected IS”, and “Buyer’s Projected CF” worksheets are hidden.
  15. A Valuation Multiple section has been added beside the “Sales/Earnings” table in the “MPSP Input” worksheet to help the user quickly calculate the implied multiple of the MPSP.
  16. New buttons have been developed to automatically create Main Street and M&A CBP documents. New buttons and links have been developed to locate the aforementioned documents.
  17. Updated instructions regarding customizing default colors for tables and graphs under Office 2007 operating environment.
  18. Addition of asking price multiples in the “MPSP Input” worksheet help users quickly understand the implied multiples of the MPSP. The “Asking Price – Multiples” worksheet has been removed and transferred all of its content into the “Export Data” worksheet, so the table of Asking Price breakdown and the table of Implied Multiples are still displayed and used in each of our marketing materials (CBP, CBO, CFO, and CFA).
  19. Bug Fix – Solved the incompatibility between FAT v. 1.03 and previous versions of FAT when using the “Input Data FromAnother FAT” function.
  20. The font size of the description in all graphs has been changed to size 7 to provide an easier view for the user of marketing materials.
  21. Bug Fix – In the “Growth Analysis” worksheet, the Growth margin, SDE margin and EBITDA margin curve in its respective chart would not change after we alternate the viewing option in Growth table from “%/Rev” to “Growth”.
  22. Bug Fix – The user is now able to switch to other worksheets under “Buyer’s Projected BS – IDCF”, “Buyer’s Projected IS – IDCF” ,”Buyer’s Projected BS – CF” worksheet by using the drop down menu.
  23. Updated the headline in some worksheets from “Confidential Business Analysis” to “Financial Analysis Template” to maintain its consistency.
  24. A “NWC Calculator” worksheet has been added to help analysts with Normal Net Working Capital.
  25. Bug Fix – Excel sporadically alternates between fields and acts irregularly, flickering and flashing until you switch sheets or fields. The solution is to uninstall update KB973475 in 2003 or KB9735393 in 2007. To do this go into “Add or Remove Programs,” under “Microsoft Office,” look for the Security updates above and select “Remove”.
  26. Bug Fix – In “Seller’s Closing BS” worksheet, pre-tax cash proceeds (net of selling expenses) now calculates commission based on the larger of $15,000 or 12% of the valuation.
  27. Bug Fix – The Benchmark Method for Calculating Required Net Working Capital now uses total expenses instead of just operating expenses in its equation.
  28. New sheet developed named “Buyer’s Closing BS.” This sheet displays what a buyer can expect to receive upon closing. It assumes that at closing the working capital will be similar to the required net working capital. For example, if the most recent balance sheet reflects a working capital shortage to the required net working capital, it is reflected on the Buyer’s Closing Balance Sheet as an asset. This sheet is an output on the CFO marketing document.
  29. New sheet developed named “Asking Price – Multiples.” This sheet calculates the implied multiples based on the asking price and the weighted earnings/revenues. The asking price is broken down into the working capital portion and the Fixed Asset/Goodwill portion. The breakdown of the asking price and the implied multiples are displayed and used in each of our marketing materials (CBO, CFO, and CFA).
  30. Updated the ‘hide’ and ‘unhide’ rows and columns function to include the new worksheets.
  31. Created a button that resets the FAT so that users may be able to save the document after an update has been completed. Upon clicking on this button, a new user will need to accept the Disclaimer and Usage Notes before being able to use the FAT.
  32. New Financial Analysis Questionnaire has been developed to automatically input actual expenses into each question, facilitating the financial analysis questionnaire process. Also, a new button has been created in the FAT to automatically generate the Financial Analysis Questionnaire.
  33. Added an Earnings Persistence Factor to the Capitalized Excess Earnings Methodology. The Earnings Persistence Factor gives analysts the option of adding pessimism into the valuation. An Earnings Persistence less than 100% indicates that the return on equity for the company will retract back to its required return over time.
  34. New documents have been created to include Confidential Business Overview (CBO), Confidential Financial Overview (CFO), and Confidential Financial Analysis (CFA). New Buttons have been developed to automatically create Main Street and M&A CBO, CFO, and CFA documents. New buttons and links have been developed to locate the aforementioned documents.