Appendix 6 - Guidance on Completing the Financial Models

[Insert detailed guidance for the Bidders on completing the Financial Models.  This guidance should include as a minimum the following:

The number and type of Models required for each Solution

The format of the Models and any software requirements and submission requirements

The periods to be covered by the Financial Models, the currency and base date for the Models

Compliance requirements, such as UK GAAP

Audit requirements for the Financial Models, including details of any certificates required

Details of each of the Financial Models required, which might include the following:

•  An assumptions sheet setting out all of the assumptions underlying the financial projections - these should include appropriate dates, macro economic assumptions, inflation, taxation rates, etc.

•  Investment Programme, including [insert details]

•  Financing assumptions, such as draw-downs, grace periods, repayment schedules and maturity, interest rates and margins, arrangement and other fees, any performance bonds and guarantees

•  Service delivery costs, including an analysis of the costs between different categories and/or components of service delivery function.  Appropriate supporting information should also be sought on the computation of these costs, such as unitised costs for operating costs, the electricity consumption assumptions, the number of employees assumed, etc

•  Taxation, including assumptions made in respect of any allowances, the applicable tax rates, marginal relief, and other relief, and other assumptions affecting the level of tax paid.  The Local Authority assumptions to be used by Bidders, such as in relation to corporation tax rates and marginal relief bandings should be set out in the guidance on completing the Financial Models

•  Key Financial Information, including the key banking ratios which the Local Authority expects to be computed

•  Profit and Loss Account

•  Balance Sheet information (including details of assets and movement on loans)

•  Cash Flow information

Any other information, such as assumptions to be used as regards payment deductions, third party revenues