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Practice Drills: Modeling a Multi Entity Liquidity Stress Scenario

A hands-on drill course for CFOs, finance controllers, group treasurers, late-stage founders and corp dev teams who answer for liquidity across more than one legal entity. You take one illustrative five-entity Indian group (a listed holdco, a manufacturing opco funded by working capital lines and commercial paper, a lender ring-fenced infrastructure SPV, a distribution subsidiary and a GIFT City entity with a USD loan) and build its liquidity stress model in a spreadsheet. You forecast 13 weeks of cash entity by entity, define what really counts as available liquidity, eliminate intercompany flows, then design a combined shock drawn from IL&FS 2018 and COVID 2020: a key buyer default, a CP rollover failure and rating downgrade, and a rupee and market shock. You run it through every entity, find the first breach week, test covenants and cross-default contagion, separate cash that can move from cash that is trapped under Sections 185 and 186, FEMA and lender ring-fences, rank the response levers, size the buffer with a reverse stress test, and finish with a one-page board report and a quarterly contingency funding plan.

Liquidity Stress TestingGroup Treasury13-Week Cash ForecastTrapped CashCovenants and Cross-DefaultContingency Funding Plan

MODULES

6

DURATION

~4 hrs

TRACK

Corporate Finance

What You'll Master

How to lay out a multi-entity liquidity stress model with entity sheets, an intercompany elimination layer and a consolidated view

How to build a 13-week base-case cash forecast for each entity and define available liquidity with sensible haircuts

How to design a plausible combined stress scenario from real Indian episodes like IL&FS 2018 and COVID 2020

How to model receipts, funding and market shocks separately and propagate them through every entity

How to find the first breach week, run covenant tests and trace cross-default contagion across the group

How to separate movable cash from trapped cash under the Companies Act, FEMA and lender ring-fences

How to rank response levers, size a liquidity buffer with a reverse stress test and report the result to the board

Access Level

LEARNER

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Everything included

Full Text Playbooks

Actionable Exercises

Mobile Reading Mode

Lifetime Updates

Curriculum Breakdown

Chapter 1: Setting Up the Drill

3 Lessons

The Drill Brief: Five Entities, One Stress Scenario11 min read

Mapping the Group: Entities, Bank Accounts, Facilities and Covenants14 min read

Laying Out the Multi-Entity Stress Model Template14 min read

Chapter 2: Drill 1, Building the Base-Case Liquidity Position

3 Lessons

Forecasting 13 Weeks of Cash Entity by Entity15 min read

What Counts as Available Liquidity: Cash, Undrawn Lines and Haircuts13 min read

Intercompany Flows and Eliminations: Avoiding Double-Counted Cash13 min read

Chapter 3: Drill 2, Designing the Stress Scenario

4 Lessons

Choosing the Shock: Lessons from IL&FS 2018 and COVID 202013 min read

Receipts Shock: Customer Delays and a Key Buyer Default13 min read

Funding Shock: CP Rollover Failure, Line Freezes and a Rating Downgrade14 min read

Market Shock: Rupee Depreciation, Fund Redemptions and Margin Calls13 min read

Chapter 4: Drill 3, Running the Stress Through Every Entity

3 Lessons

Propagating the Shocks and Finding the First Breach Week15 min read

Covenant Tests and Cross-Default Contagion Across the Group14 min read

Trapped Cash: What Cannot Move Under Sections 185 and 186, FEMA and Lender Ring-Fences14 min read

Chapter 5: Drill 4, Building the Response Plan

3 Lessons

Ranking the Levers: Payables, Capex Deferral, Redemptions and Drawdowns14 min read

Legal Intra-Group Funding Moves Inside the Stress Window13 min read

Survival Horizon, Reverse Stress Testing and Sizing the Buffer14 min read

Chapter 6: Drill 5, Reporting and Governance

2 Lessons

The One-Page Stress Report for the Board and Audit Committee12 min read

From One-Off Drill to Quarterly Stress Test and Contingency Funding Plan13 min read