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How The Personal Fence Works

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This shows you how to use The Financial Fence for your personal finances

This shows you how to use The Financial Fence for your personal finances

Published in: Economy & Finance, Business
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  • 1. HOW THE PERSONAL FENCE WORKS © Copyright The Financial Fence Pty Ltd 2005
  • 2. © Copyright The Financial Fence Pty Ltd 2005
  • 3. © Copyright The Financial Fence Pty Ltd 2005
  • 4. © Copyright The Financial Fence Pty Ltd 2005
  • 5. © Copyright The Financial Fence Pty Ltd 2005
  • 6. © Copyright The Financial Fence Pty Ltd 2005
  • 7. © Copyright The Financial Fence Pty Ltd 2005
  • 8. © Copyright The Financial Fence Pty Ltd 2005
  • 9. © Copyright The Financial Fence Pty Ltd 2005
  • 10. © Copyright The Financial Fence Pty Ltd 2005
  • 11. A CASE STUDY GEORGE & MARTHA MIAF © Copyright The Financial Fence Pty Ltd 2005
  • 12. George and Martha Miaf Example Calculate the Opening Equity BALANCE SHEET BALANCE SHEET “AS AT” “AS AT” THE FINANCIAL FENCE ® PERSONAL PERSONAL NET INCOME STATEMENT CAPITAL CAPITAL “FOR THE PERIOD” $316,000 PERSONAL INVESTMENT EXPENSES INTEREST REVAL/DEVAL REVAL/DEVAL NET INCOME INCOME PERSONAL CAP INVESTMENT CAP INCOME $51,000 $180 -$37,000 -$7,800 -$2,000 $5,000 INVESTMENT INVESTMENT CASH FLOW STATEMENT CAPITAL CAPITAL “FOR THE PERIOD” $63,000 REVAL/DEVAL REVAL/DEVAL NET INCOME CHANGE IN CHANGE IN NET CASH FLOW PERSONAL CAPITAL INVESTMENT CAPITAL PERSONAL CAP INVESTMENT CAP +/- to Debt +/- to Debt -$2,000 $5,000 $5,500 $5,000 DEBT DEBT $111,500 EQUITY EQUITY PERSONAL CAPITAL $316,000 plus INVESTMENT CAPITAL $63,000 EQUALS $267,500 DEBT $111,500 plus EQUITY $267,500 Fence Pty Ltd 2005 © Copyright The Financial
  • 13. George and Martha Miaf Example Calculate the Income and Cash Flow BALANCE SHEET BALANCE SHEET “AS AT” “AS AT” THE FINANCIAL FENCE ® PERSONAL PERSONAL NET INCOME STATEMENT CAPITAL CAPITAL “FOR THE PERIOD” $316,000 PERSONAL INVESTMENT EXPENSES INTEREST REVAL/DEVAL REVAL/DEVAL NET INCOME INCOME PERSONAL CAP INVESTMENT CAP INCOME $51,000 $180 -$37,000 -$7,800 -$2,000 $5,000 $9,380 INVESTMENT INVESTMENT CASH FLOW STATEMENT CAPITAL CAPITAL “FOR THE PERIOD” $63,000 REVAL/DEVAL REVAL/DEVAL NET INCOME CHANGE IN CHANGE IN NET CASH FLOW PERSONAL CAPITAL INVESTMENT CAPITAL PERSONAL CAP INVESTMENT CAP +/- to Debt +/- to Debt -$2,000 $5,000 -$9,380 $5,500 $5,000 $4,120 DEBT DEBT $111,500 EQUITY EQUITY $267,500 © Copyright The Financial Fence Pty Ltd 2005
  • 14. George and Martha Miaf Example Calculate Personal Capital BALANCE SHEET BALANCE SHEET “AS AT” “AS AT” THE FINANCIAL FENCE ® PERSONAL PERSONAL NET INCOME STATEMENT CAPITAL CAPITAL “FOR THE PERIOD” $316,000 $319,500 PERSONAL INVESTMENT EXPENSES INTEREST REVAL/DEVAL REVAL/DEVAL NET INCOME INCOME PERSONAL CAP INVESTMENT CAP INCOME $51,000 $180 -$37,000 -$7,800 -$2,000 $5,000 $9,380 INVESTMENT INVESTMENT CASH FLOW STATEMENT CAPITAL CAPITAL “FOR THE PERIOD” $63,000 REVAL/DEVAL REVAL/DEVAL NET INCOME CHANGE IN CHANGE IN NET CASH FLOW PERSONAL CAPITAL INVESTMENT CAPITAL PERSONAL CAP INVESTMENT CAP +/- to Debt +/- to Debt -$2,000 $5,000 -$9,380 $5,500 $5,000 $4,120 DEBT DEBT $111,500 + EQUITY EQUITY $267,500 © Copyright The Financial Fence Pty Ltd 2005
  • 15. George and Martha Miaf Example Calculate Investment Capital BALANCE SHEET BALANCE SHEET “AS AT” “AS AT” THE FINANCIAL FENCE ® PERSONAL PERSONAL NET INCOME STATEMENT CAPITAL CAPITAL “FOR THE PERIOD” $316,000 $319,500 PERSONAL INVESTMENT EXPENSES INTEREST REVAL/DEVAL REVAL/DEVAL NET INCOME INCOME PERSONAL CAP INVESTMENT CAP INCOME $51,000 $180 -$37,000 -$7,800 -$2,000 $5,000 $9,380 INVESTMENT INVESTMENT CASH FLOW STATEMENT CAPITAL CAPITAL “FOR THE PERIOD” $63,000 $73,000 REVAL/DEVAL REVAL/DEVAL NET INCOME CHANGE IN CHANGE IN NET CASH FLOW PERSONAL CAPITAL INVESTMENT CAPITAL PERSONAL CAP INVESTMENT CAP +/- to Debt +/- to Debt -$2,000 $5,000 -$9,380 $5,500 $5,000 $4,120 DEBT DEBT $111,500 + EQUITY EQUITY $267,500 © Copyright The Financial Fence Pty Ltd 2005
  • 16. George and Martha Miaf Example Calculate the Debt BALANCE SHEET BALANCE SHEET “AS AT” “AS AT” THE FINANCIAL FENCE ® PERSONAL PERSONAL NET INCOME STATEMENT CAPITAL CAPITAL “FOR THE PERIOD” $316,000 $319,500 PERSONAL INVESTMENT EXPENSES INTEREST REVAL/DEVAL REVAL/DEVAL NET INCOME INCOME PERSONAL CAP INVESTMENT CAP INCOME $51,000 $180 -$37,000 -$7,800 -$2,000 $5,000 $9,380 INVESTMENT INVESTMENT CASH FLOW STATEMENT CAPITAL CAPITAL “FOR THE PERIOD” $63,000 $73,000 REVAL/DEVAL REVAL/DEVAL NET INCOME CHANGE IN CHANGE IN NET CASH FLOW PERSONAL CAPITAL INVESTMENT CAPITAL PERSONAL CAP INVESTMENT CAP +/- to Debt +/- to Debt -$2,000 $5,000 -$9,380 $5,500 $5,000 $4,120 DEBT DEBT $111,500 $115,620 EQUITY EQUITY $267,500 © Copyright The Financial Fence Pty Ltd 2005
  • 17. George and Martha Miaf Example Calculate the Closing Equity BALANCE SHEET BALANCE SHEET “AS AT” “AS AT” THE FINANCIAL FENCE ® PERSONAL PERSONAL NET INCOME STATEMENT CAPITAL CAPITAL “FOR THE PERIOD” $316,000 $319,500 PERSONAL INVESTMENT EXPENSES INTEREST REVAL/DEVAL REVAL/DEVAL NET INCOME INCOME PERSONAL CAP INVESTMENT CAP INCOME $51,000 $180 -$37,000 -$7,800 -$2,000 $5,000 $9,380 INVESTMENT INVESTMENT CASH FLOW STATEMENT CAPITAL CAPITAL “FOR THE PERIOD” $63,000 $73,000 REVAL/DEVAL REVAL/DEVAL NET INCOME CHANGE IN CHANGE IN NET CASH FLOW PERSONAL CAPITAL INVESTMENT CAPITAL PERSONAL CAP INVESTMENT CAP +/- to Debt +/- to Debt -$2,000 $5,000 -$9,380 $5,500 $5,000 $4,120 DEBT DEBT $111,500 $115,620 EQUITY EQUITY CONTROL CHECKS 1. TOTAL CAPITAL = DEBT + EQUITY $267,500 $276,880 2. OPENING EQUITY + NET INCOME = CLOSING EQUITY 3. OPENING DEBT + NET CASH© Copyright= CLOSING DEBT2005 FLOW The Financial Fence Pty Ltd
  • 18. Contact us Email: service@onesherpa.com www.thefinancialfence.com www.onesherpa.com © Copyright The Financial Fence Pty Ltd 2005

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