Download Financial model user guide

Setting price controls for 2015-20: PR14 financial model user guide
September 2014
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Separation of the single price control into four price controls across
wholesale and retail.
PR14 incentive mechanisms.
Retirement of the PR09 capital expenditure (capex) incentive scheme
(CIS) mechanism.
Discontinuation of the Construction Output Price Index (COPI) for cost
recovery.
Simplified tax approach.
Depreciation using a run-off rate schedule.
Move to International Financial Reporting Standards (IFRS) from UK
Generally Accepted Accounting Principles (GAAP) and harmonisation
with IFRS.
Removal of the June return reporting requirement.
1.6
The model uses VBA macros for price control solving, and a user interface to
guide the user. Note that the running of a VBA macro cannot be reversed via
the Excel Undo function.
1.7
The inputs of the financial model will be sourced in part from separate Ofwat
internal models and the business plan templates (BPTs) input directly by the
user into the financial model, and in part from user specified assumptions.
1.8
The key outputs of the financial model will be uploaded to Fountain 1 via the
‘F_Outputs’ worksheet in the model.
1.9
The calculations in the financial model are applicable to all companies.
1.10
The financial model has been developed in line with the PR14 Financial
Model Rulebook (‘PR14 Rulebook’), which in turn has been developed in line
with the methodology statement.
Structure of this user manual
1.11
This user manual provides guidance on the macro-enabled version of the
Excel financial model. It covers:
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Fountain is an internal Ofwat system that facilitates the integration of the business plan templates
and models in the Ofwat modelling suite.
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