Forecasting of Balance SheetsPrimarily this depends on the long term borrowings. We can project based on firm's capital structure. For Example, if a firm maintains are debt equity ratio of 1:2, than for a capex of rupees 300 crore ,they are likely to raise Rs 100 crore debt. These assumptions have to be built in, and explicitly specified.Forecasting of balance sheets current Assets and Current Liabilities.It depends on the amount of sales, since companies try to keep working capital as percentage of sales constant. Therefore, we try to identify if the company has been able to manages this in the past, and what the numbers look like. We can also convert into days worth of sales, which is similar to finding these numbers as % of sales.Financial Modeling For Debt and BondsModels for debt repayment.Modeling Amorting loans.EMIsFinancial Modeling for bonds.Bond Pricing.Models for Debt RepaymentCompanies that take debt, need to create a schedule to repay it. The repayment has to be modelled in financial models. There can be various ways this debt can be repayed.1. The debt could be repayed in equal monthly installment.2. The principle could be repayed in equal amounts over a tenure.3. There could be a specific customize schedule for a certain loan.4. The loan repayment could be to manage a certain debt services coverage ratio.Equated InstallmentsUnder this method, similar to home loans repayment, an equal amount will be paid everywhere. This would be a combination of interest and principal, with principal being lower in initial periods, and interests and interest being higher. At the end of the tenure, by making equal payments, we should reach a debt level of zero.We can use the PMT and PPMT function to find out the instalment and the principal repaid.Customized Payment ScheduleUnder this method, usually the company and the bank agree on a specific customized payment schedule. This may be higher in initial years, and lower later, or vice versa.Debt SculptingUnder this method, the company now incorporates how clash flows could define how much money is being repaid. In the earlier methods, whether the company was making money or not, we were creating a repayment schedule.