NPV without an outflow

Roelofg · June 2021

Good morning

I am building a model consisting of future variable monthly cash outflows without any cash inflows.

I need to calculate the NPV of that in order to convert that into a liability using the variable cash outflows as down payments..

The NPV formula require cash in and cash out.

What are your suggestions?

ChrisAHeathcote · June 2021

@Roelofg

It is possible to calculate the NPV as per your table.

NPV can work with with data whose source is either dimensioned by time period or a transactions list.

I will outline both approaches;

With Time

Cashflows are laid out using time dimension.

Without Time

Time dimension has been removed and a transaction list added.

This is the result;

The difference in values is due to the time calculation taking the full model calander and discounting over the full 3 years. The no time calculation only calculates for the values and dates presented and will stop discounting after the final transaction.

Misbah · June 2021

@Roelofg

In Our April Group Event we discussed how NPV can be calculated without Anaplan timescale. Here is the link.

https://community.anaplan.com/t5/Modelers-Forum-India/Recording-of-Group-Event-13-04-2021/m-p/105085

Hope this helps

Misbah

LipChean_Soh · June 2021

Hi @Roelofg

I would suggest that you come up with a mock up in excel, and share the screen shot here.

Thanks,

LipChean

Roelofg · June 2021



		5%

		Jan-21	Feb-21	Mar-21	Apr-21	May-21	Jun-21	Jul-21	Aug-21	Sep-21	Oct-21	Nov-21	Dec-21	Jan-22	Feb-22

Monthly		1000	1000	1000	1000	1000	1000	1000	1000	1000	1000	1000	1000	1000	1000
Variable							500						500
End of Contract														2000
		1000	1000	1000	1000	1000	1500	1000	1000	1000	1000	1000	1500	1000	3000
	NPV	$16,422.30