Case study solution (Balance Sheet tab) H. Schwarz-Lopes & A. Santos

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Case study solution (Balance Sheet tab) H. Schwarz-Lopes & A. Santos

  1. 1. PFS 12/31/2011 12/31/2012 Adjusted 12/31/2012 CommentsASSETS Adjusted version ratiosLiquid Asset total liquidityCash (1) $500,000 $575,000 $450,000 there is $125M in YBA deposit (not cash.) Always verify liquidity $1,350,000Marketable Securities (2) $2,675,000 $900,000 there is $1,775M = value of PAs 34%CVLI $50,000 $50,000 $50,000IRA $40,000 $40,000 $40,000 Can the client access this liquidity?Real Estate Owned $4,225,000Residence $1,875,000 $1,925,000 Do you have a current appraisal or comparables?/Adjust Value1 Lot $800,000 $400,000Office Building $1,900,000 $1,900,000Sevierville Ranch $1,100,000Real Estate Investments/ RE Partnerships $1,100,000K-2 shopping Center (7%) $600,000 $650,000 Do you think the client could liquidate or access this value?Mt. Vison Shoppting Center (10%) $400,000 $450,000 Do you think the client could liquidate or access this value?Other AssetsPersonal Property - auto, furniture, yacht (6) $630,000 $665,000 $665,000 Most banks deduct these from Adjusted NWOther Assets $100,000 $125,000 $125,000 Most banks deduct these from Adjusted NWNote Receivables (3) $370,000 $620,000 $620,000 Consider likelihood of these paying/when?/how much?Other Assets - YBD deposit $125,000 What are they buying? What liquidity?Closely Held Companies (BL PA, DL PA) $1,500,000 $1,775,000 Most banks deduct these from Adjusted NW/ Lack of liquidityClosely Held Business - Wing Travel $175,000Total Assets $10,040,000 $10,075,000 $10,075,000LIABILITIESLine of Credit $250,000 $300,000 $600,000 Client provided information that this line is $600M (only $300M o/s)Other Note Payable (7) $260,000Auto loans $50,000 $70,000Boat loan $200,000 $190,000Mortgage Debt (8) LTVshortfall fromrequestedamountResidence $1,300,000 $1,250,000 $1,540,000Client wants $500M more, but based on the value of the propertythey dont qualify (loan assumes 80% LTV) 80% $210,000Office Bldg $1,600,000 $1,560,000 $1,425,000We need to refi the $160M sellers note + the $1,560M/ Most banks donot lend more than 75% LTV on owner occupied 75% $295,000Lots $400,000 $200,000 $200,000 $505,000Total Liabilities $3,800,000 $3,570,000 $4,025,000Net Worth $6,240,000 $6,505,000 $6,050,000Adjusted Net Worth CalculationDeductPersonal Property $630,000 $665,000Other Assets $100,000 $125,000Notes Receivables $370,000 $620,000Other Assets - Deposit $0 $125,000Closely Held Companies (BL PA, DL PA) $1,500,000 $1,775,000Closely Held Business - Wing Travel $175,000Total amount to adjust from out of NW $2,775,000 $3,310,000Adjusted Net Worth $3,465,000 $2,740,000

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