Modeling a Reorganization

The aim of this session is to build a model which forecasts the impact of undergoing a financial restructuring. The model covers both the restructuring and the emergence phase. Both the financial and operational restructuring will drive the emergence date adjustments. This model will integrate a two stage accounting adjustment model into a three statement financial forecast model.

Key topics

• Dealing with liabilities subject to compromise
• Projecting the income statement
• Dealing with the petition stage adjustments
  • Liabilities subject to compromise
• Emergence date adjustments
  • Goodwill
  • Sources and uses of funds
  • New debt structure
  • New equity structure
  • Elimination of liabilities subject to compromise
  • Elimination of retained earnings
• Sources and uses table to help summarize the issues of the financial restructuring
• Building operational changes into the model
• Understanding cash sweeps and the impact on the debt schedule