Line of Credit

Use Jirav to forecast your Line of Credit balance and associated Interest Expenses through the Custom Table

This article walks through the steps to setting up a Loan balance schedule, forecasting the Payments to the balance, and expensing the Interest.

Step 1: Set Up Assumptions

Step 2: Create a Custom Table for Line of Credit

Step 3: Set Up the Interest Calculation

Step 4: Create Drivers for the Balance Sheet

Step 5: Review the Liabilities Line of Credit Account

Step 6: Link Interest Expense to the Income Statement Expense Account

Step 1: Set Up Assumptions

1. Navigate to Settings > Assumptions.
2. Create a custom table for the balance sheet to include other forecasted items.
3. Add assumption accounts for:
   • Line of Credit Monthly Payment (Optional if using manual entries for payments)
   • Line of Credit Monthly Interest Rate 

Step 2: Create a Custom Table for Line of Credit

1. Go to the Custom KPIs Table (or any other custom table).
2. Create a "Line of Credit" section at the top.
3. Add a reference line for the line of credit account balance.
4. Create a new line called "Line of Credit Interest" to calculate accrued interest.

Step 3: Set Up the Interest Calculation

1. Open the Custom Table and locate your planning table.
2. Add a Custom Driver to calculate the interest.
3. Set Input 1 to reference the Line of Credit account from the previous month.
4. Multiply it by the Line of Credit Monthly Interest Rate assumption.
5. Save the driver and enter values under Assumptions for the payment and interest rate.

Step 4: Create Drivers for the Balance Sheet

1. Navigate to the FX (Drivers) Button on the right panel.
2. Create the first driver for interest accrual:
   • Name: LOC Interest
   • Output: Liabilities > Line of Credit (Increase)
   • Driver: Custom Table > LOC Interest
3. Create the second driver for monthly payments:
   • Name: LOC Payment
   • Output: Liabilities > Line of Credit (Decrease)
   • Driver: Assumptions > Monthly Payment

Step 5: Review the Liabilities Line of Credit Account

1. Open the Liabilities Account to verify interest accrual and payments.
2. Expand the details to see:
   • Interest accrual (increase driver)
   • Monthly payment (decrease driver)
   • Net change in balance over time

Step 6: Link Interest Expense to the Income Statement Expense Account

1. Locate the Interest Expense Account under Other Income & Expense.
2. Assign it to the appropriate department (or leave it as Unassigned).
3. Use Input 1 to reference the LOC Interest Custom Table Line.
4. Confirm that interest decreases over time as payments are applied.