What is it?
PPP, PFI and project finance transactions typically span over a period in excess of 25 years. During this period, projects may often undergo significant changes and it is important that models are updated to reflect such changes and actual performance for covenant monitoring and other purposes.
PKF provides modelling support throughout the whole project lifecycle. Our involvement continues beyond financial close, for example, in updating models for actual performance for covenant monitoring purposes or to reflect contract variations and refinancing scenarios.
What we do
PKF has a strong track record in undertaking financial model development and review across a range of market sectors, including secondary market and investment funds. Our experience has been built up over the last 20 years, on both national and international projects, covering some 300 plus projects. Indeed, we have built up a large database of projects and we have worked with a wide range of project finance funders, banks and private sector sponsor organisations.
Our aim on model custodial and update services assignments is to ensure that the model is appropriately updated to reflect actual performance or contract variations. Often it is necessary to carry out a detailed ‘coding’ update within the model to ensure that it is flexible enough and able to input actual data readily reflecting the underlying project performance or contract variations. In addition, this is supported by a top-down review to ensure that the commercial requirements of the project are achieved, for example, project IRR and debt service cover ratios. We also frequently provide independent assurance that models are appropriately updated and covenant conditions are met.
The benefits to you
Our proven capability to produce updated models to reflect actuals and contract variations provides our client with confidence that the models are reliable. In addition, we provide our clients with assurance that models have been appropriately updated to reflect historical performance for more efficient covenant monitoring purposes.
Our prior involvement on the project or similar projects (for example, at financial close) provides us with fast and easy access to information and financial models. We are therefore able to provide an effective audit trail of changes made to models post financial close. In addition, our familiarity with the project and relevant issues ensure that we are able to respond quickly and provide solutions.
Why PKF?
Our team of PFI, PPP and project finance specialists has significant experience in custodial and update services, across a range of sectors. Our track record includes specifically operational monitoring, updates for actuals and contract variations, and supports our leading position in specialist modelling support and assurance services.
Our model update and development methodology incorporates a ‘best practice’ approach. Further, our dedicated team is able to provide a flexible and adaptable approach to assignments, using our experience to build complex and robust models on a timely basis. We adopt a commercial risk based approach, which incorporates controls to minimise the risk of errors.
Our understanding of issues, supported by our solution-focused approach to custodial and update services assignments, minimises the front-end familiarisation process and ensures that we focus on critical areas to deliver updated models on a cost-efficient and time-efficient basis.
Recent projects include:
- Secondary Market Infrastructure Fund – update and review of portfolio models
- Metronet – covenant compliance review
- Corla – review of operational models
- Calyon – Nigeria LNG covenant compliance review
For further information about any of the services offered please contact either Brian Tash or Kirit Mistry
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