90min 3 statement LBO model test
had a 90min 3 statement LBO test from scratch with a fully adjusted B/S (i.e., PF Goodwill, DTL unwind etc), along with other nuanced bells and whistles in the test (e.g., mandatory payment, undraw fee, 3 tranches of debt).
i got the PF balance sheet to balance and got the 3 tranches of debt to work but i ran out of time to complete my returns calc - had only gotten to ending EV... is that an auto ding?
90min for a 3 statement LBO from scratch feels like such a crunch. the prompt wasnt hard but just takes time to get through...
Based on the most helpful WSO content, a 90-minute 3-statement LBO model test is indeed a tight timeline, especially when it includes a fully adjusted pro forma balance sheet, multiple debt tranches, and nuanced details like mandatory payments and undrawn fees. While running out of time to complete the returns calculation might not be an automatic "ding," it could depend on the specific expectations of the firm and how much weight they place on completing the test versus demonstrating a strong understanding of the mechanics.
Here are some key considerations:
Pro Forma Balance Sheet Balancing: Getting the pro forma balance sheet to balance is a significant achievement. It shows you understand the mechanics of adjustments like goodwill, deferred tax liabilities, and other pro forma changes.
Debt Tranches Functionality: Successfully modeling the three tranches of debt and ensuring they work correctly is another strong indicator of your technical skills.
Returns Calculation: While not completing the returns calculation might be a drawback, firms often value the process and logic you demonstrate over simply finishing. If you can explain your approach and how you would have completed the returns calculation, it could mitigate the impact of running out of time.
Time Management: Given the tight timeline, firms may also assess how well you prioritize tasks. For future tests, consider focusing on the most critical components first (e.g., returns calculation) and leaving less essential details for the end.
In summary, while not completing the returns calculation could be a negative, it’s not necessarily an automatic rejection. If you demonstrated strong technical skills and logical thinking throughout the test, you might still be in a good position. For future preparation, practicing under timed conditions and focusing on prioritization could help you manage similar challenges more effectively.
Sources: Sources and Uses statement - private LBO model, Multi-Family Acquisitions Excel Test, Mistakes on WSO PE Prep Pack Models?, Guide to Lateraling in 2021, "Leaving IB Soon, Final Rants" - The Follow-Up
bump
I wouldn't hold your breath but you got most of the way there. From ending EV there's likely only a few lines left to go.
When facing complexities in the future, I would recommend first shelling out the full LBO and then adding in complexities at the end -- at the very least now you know that you are able to implement these complexities under pressure and now only need to focus on speed
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