Associates
Overview
The Associates module is composed of three interconnected components:
Investments in Associates represent ownership stakes in entities where the investor has significant influence but not full control (e.g., joint ventures). These investments are reported on the Balance Sheet under Assets. The closing balance is calculated as the opening balance plus Earnings from Associates, minus Dividends from Associates.
Earnings from Associates represent the investor’s share of the associate’s net income. These earnings are reported on the Income Statement (typically below EBIT). Since they are non-cash, they are subtracted from net income and added back in the Cash Flow Statement under Operating Activities.
Dividends from Associates are cash distributions received from the associate. They reduce the investment balance and are reported in the Cash Flow Statement under Cash Flow from Investing Activities.
Model Flow
[NTD: Add visual model flow chart here]
Adding a module
To add an Associates module to a model, select one of the following nodes in the Blueprint window:
- Schedule → Associates
- Balance Sheet → Investment in Associates
- Income Statement → Earnings from Associates
- Cash Flow Statement → Dividends from Associates
Editable Properties
Investment in Associates
Inclusion
Impacts the following sections of the model:
- Associates Schedule
- Balance Sheet (Assets)
- DCF, LBO, and M&A models
See Inclusion for more details.
Name
See Display Name for more details.
Earnings from Associates
Inclusion
Impacts the following sections of the model:
- Associates Schedule
- Income Statement
- Cash Flow Statement → Operating Cash Flow → Non-cash adjustments
- DCF, LBO, and M&A models
See Inclusion for more details.
Name
Default: Earnings from Associates
See Display Name for more details.
Forecast
Default: Growth Rate
Available Methods:
- Growth Rate
- Hardcoded Input
- Nil
- Last Historical
- Ratio
Non-Taxable
Default: False
Taxes are typically paid at the associate level.
See Non-Taxable for more details.
Dividends from Associates
Inclusion
Impacts the following sections of the model:
- Associates Schedule
- Cash Flow Statement → Investing Cash Flows
- DCF, LBO, and M&A models
See Inclusion for more details.
Name
Default: Dividends from Associates
See Display Name for more details.
Forecast
Default: Ratio (% of Earnings from Associates)
Available Methods:
- Ratio (recommended)
- Hardcoded Input
- Nil
- Last Historical
- Growth Rate
Additional Materials
See Associates 101 page for more details.