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Sample "IRR Lookback" Model

Enter the values in the light blue cells and press the "Update" button to run the model.

IRR Hurdle Model - Annual                  
 
 
  Cash Flow for Deal  
     
  Hurdle Rate Pension Fund Developer    
  Tier 1    
  Tier 2    
  Tier 3      
     
  IRR      
     
Tier 1      
       
  Pension Fund  
  Developer  
 
 
  Year 0 1 2 3 4 5  
  Unmodified Cash Flow for Pension Fund  
     
  Hurdle Rate per year  
 
  Equity    
  PV of All Years To Current  
  "Missing" PV    
  FV Needed    
     
  Was Hurdle Reached?    
     
  Cash Flow "below hurdle"    
  Cash Flow "above hurdle"    
     
         
  To prove if it's working, it's easy. Just take the IRR of all cash flow below the hurdle up to and including any year where the hurdle was met.
 
  For example:      
 
  Year  
  Cash Flow "below hurdle"  
     
  IRR  
 
     
  Modified CF for Pension Fund  
  Modified CF for Developer  
     
Tier 2      
     
  Cash Flow for Next Level  
     
     
   
   
         
     
  Year 0 1 2 3 4 5  
   
     
  Hurdle Rate per year  
 
  Equity    
  PV of All Years To Current  
  "Missing" PV    
  FV Needed    
     
  Was Hurdle Reached?    
     
  Cash Flow "below hurdle"    
  Cash Flow "above hurdle"    
 
 
  To prove if it's working, it's easy. Just take the IRR of all cash flow below the hurdle up to and including any year where the hurdle was met.
 
  For example:      
 
  Year  
  Cash Flow "below hurdle"  
     
  IRR  
 
  How much did we already pay out to Pension Fund?  
     
  Difference from 11% to 15% level for Pension Fund  
  Difference from 11% to 15% for Developer  
     
  Cumulative CF to Pension Fund  
  Cumulative CF to Developer