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Dynamics 365 Community / Forums / Microsoft Dynamics GP (Archived) / Using Management Repor...
Microsoft Dynamics GP (Archived)

Using Management Reporter to calculate debt covenant ratio

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Posted on by Community Member

Hi there, one of my clients is required to calculate debt covenant ratios on a quarterly basis using 12-month rolling numbers from their consolidated income statement.  They have asked me if I can automate that process. Calculating EBITDA is easy enough, but getting the total debt payments made during the last 12 months is a little confusing. Has anyone ever had a request for a report like this or used MR to calculate this themselves?


The main calculation that I'm trying to have MR take care of is:


EBITDA divided by (interest expense + debt payments made during the last 12 months)

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    Redbeard Profile Picture
    Redbeard 12,931 on at

    Michael,

    I would think the most difficult part of this issue would be to make sure you get the calculation right. I would start by Calculating EBITDA, which as you said is easy enough. Then you need to understand if the interest expense and debt payments should be part of the EBITDA calculation, before applying your ratio. If they should not be, then you'll have to back them out. By now you should have a good idea of where the interest expense and debt payments.

    In order to get the 12 months for the column, you'll need to use BASE-12:BASE.

  • Community Member Profile Picture
    Community Member on at

    Thank you!

    Their EBITDA calc includes debt payments + interest, but those debt payments are only hitting a 4 or 5 GL accounts designated specifically for this type of transaction (so that takes care of a lot of the complexity around figuring out what's what in the GL). My plan is to use the row modifiers and only capture debits from the payables module accounts, and use the column like you suggested above to get the rolling 12 month.

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