Pro-Forma Balance Sheet Exercise

Video Explanations of M&A Model Exercises

Computing Pro-forma Balance Sheet in Acquisition

Exercise 6: Balance Sheet and Pro Forma

Cash Flow Sweep with Crash and Default Analysis


I am in the process of explaining and uploading the exercises.  If you would like the files in the meantime, send me an e-mail to and request resource library.

Exercise 3 – Holding Period Exercise – Basic.xls

Exercise 4 – Holding Period Exercise – Including Dates.xls

Exercise 5 – Holding Period Exercise Complex.xls

Exercise 6 – Acquisition Balance Sheet.xlsm

Exercise 7: Cash Flow Sweep and Default

Exercise 7 – Cash Flow Sweep.xlsm

Exercise 8 – LBO Exercise with Balance Sheet.xlsm

Exercise 10 – Synergies and Premium.xlsm

Exercise 11 – Accretion and Dilution Exercise.xlsm

Exercise 5: Outputs and Analysis in Acquisition

Exercise 6 – Taxes in Acquisition.xls


Tax Aspects of Acquisition Model

The tax aspects of an acquisition model can become somewhat complex, particularly in the rather typical situation where purchase accounting is used for book purposes, but for tax purposes the transaction is treated as a tax free exchange. When this case, the tax depreciation will be different from the book depreciation and deferred taxes will arise. Furthermore, the deferred taxes will expire as the existing assets retire unlike deferred taxes related to on-going capital expenditures and normal growth. A number of the complex issues associated with modelling tax aspects of an acquisition are addressed in Exercise 6. Other issues associated with taxes such as NOL and depreciation are covered in the corporate finance model exercises.