This manual and accompanying workbook are designed to help you build necessary 

flags, counters and timeline into your Project financial model. The workbook can be 
used as a template for building your own financial model.  

It also contains sensitivity analysis sheet and Integrity checks that should be linked 
to the model once all the building blocks are put in place.  

In this manual you will learn: 

● Why it is important to have flexible timeline in your financial models  

● What is a timeline? 

● Single timeline versus multiple timeline 

● How to use the timing flags  

If you want to know more about Timing in project finance models, check “Season 2, 
Episode 2” of the ​Financial Model Detective book​ and also check Edward Bodmer’s 
book ​“Corporate and Project Finance Modeling”​ Chapter 7.  

Color codes used in this spreadsheet are listed below. You might want to change 
the color codes to match your own standards just remember to apply the same 
color codes throughout your model. To facilitate color coding your sheets, you can 
use Professor Edward Bodmer’s ​“Generic Macro” tool​.  

 
 
Why is it important to have a flexible timeline in a
project finance model?
Project finance is like a living human being and has different stages of life. 

In my experience working in project finance deals since 2010, I have not seen one 
single project that went according to plan and didn’t face any delay in one way or 
another.  
 
For example, imagine that you are assigned to work as the financial modeller of a 
project and the project is almost about to close. Most of the contracts are in place 
but all of a sudden one of the lenders pulls out of the deal and sponsors together 
with the existing lenders should look for ways to fill up the gap. This delay in 
financial close will affect your projection and all projections should move forward 
by let’s say 6 months. If the model is not flexible, adjusting the model manually will 
require a lot of your time and effort. But if you have built the necessary mechanics 
to make this adjustment automatically then this can be done by simply changing 
one single parameter in your inputs.  
So while building your model, you need to take this uncertainty into consideration 
and make your projections periods to adjust automatically with time scales.
What is a timeline?
The main aim of a project finance model is to make cash flow projections covering a 
lifetime of a project. Therefore, one of the building blocks is to have a timeline on 
top of each worksheet in the financial model.  

Single timeline versus multiple timeline

The decision to have one single timeline or multiple timeline is a decision that you 
as the financial modeler, should take upfront in the design stage.  

Having one single timeline means that you will have one time ruler across all the 
pages and modules of your model. You can still provide flexibility to have for 
different periodicity during construction and operation but it will be reflected in 
one single timeruler. For example in the below snapshot, construction is on a 
monthly basis and when we get to operation, projections are done on a semi-annual 
basis.  

We can also have a single timeline Semi-annually throughout the projections like in 
the example below: 

 
Multiple timeline means you need to build two separate time ruler for 
pre-operation phases and operation phases. There will be different timing flags and 
counters for each of these time rulers.  

In order to do this, you need to have a dedicated sheet for calculating flags and 
counters during construction and a seperate sheet for all flags and counters related 
to operation flows. 

In this workbook, I am using a single timeline with the flexibility to have different 
periodicity for pre-operational phases versus operational phases.  

The reason is that during the construction phase of the project, all parties are 
interested to monitor the budget and drawdowns on monthly basis. On the other 
hand, during operation and repayments of debt, the projection should match the 
frequency of debt repayment. For example if the project should repay the debt on a 
semi-annual basis and all ratios will be calculated on semi annual basis, then the 
model should be built semi-annually during operation.  

One might ask, why not build the whole model on a monthly basis. The answer is 
that yes, it’s doable but it brings additional complexity to the model and makes the 
file is too heavy and difficult to maintain and send across. The extended number of 
columns will also increase the cost of the model audit. Also you need to build 
additional flags for calculating ratios on semi-annual basis when your projection are 
on a monthly basis.  

To change the model periodicity, you only need to change two input parameters 
highlighted below: 

 
How to use the timing flags
If you choose to use the timing template then you are a couple of steps ahead in 
building your finance models.  
 
In the worksheet labeled “Time” you already have typical flags and counters that are 
required to automate any possible changes in key project timeline.
 
However, you need to use the timing flags throughout the model and use them 
across formulas when necessary.  
 
In the example below, to calculate periodic revenues, I take the annual production 
and multiply it by the number of days in the period and divided by 365 (#days in a 
year).  
 

 
 
This way if the operation start date is changed, then the number of days in 
operation period will change and revenues will adjust automatically.  
You need to do the same thing for opex, capex, depreciation, debt service and 
almost every cash flow items projected in the financial model.  
 

In the Excel template, you can also find the below sheets.  
- “Sens”: Dedicated to sensitivity analysis. Once you have all the modules in 
place, you can use this sheet to perform sensitivity analysis. For more 
information on how to use this sheet, refer to: 
Sensitivity and Scenario Analysis Excel Template with VBA  
Sensitivity Analysis Template Using Data Table  
- “Checks”: contains typical integrity checks to be included in the model. As 
you progress in building different components of the financial model, you 
can use this sheet as a roadmap on the checks that needs to be included and 
eventually you create the checks and link them to this sheet. To learn more 
about these checks, read the manual from the below link:
Building Integrity Checks in Project Finance Models (Manual & Template)  
- “MasterSheet”: a master sheet that serves as a template for building other 
modules. 
 
Once you’ve had a chance to read the manual and go over the template, I would 
love to hear from you. please share your thoughts and ideas directly in the 
comments.  
 
In the meantime, stay $locked$ and happy modelling.  
 
Hedieh 
h.kianyfard@finexmod.com