Debt schedule
Tranches, interest, amortisation and the sweep.
By Surojit Chakraverti, founder of L3VLUP and an investor running a long-short healthcare and technology equities strategy.
On this subject: debt schedule.Updated 30 September 2026
What it does
The financing engine of a model. Each tranche has an opening balance, draws or repayments, and a closing balance; interest is charged on the balance and flows to the income statement; the repayments flow to financing cash flow. In an LBO the schedule also decides how excess cash is used, which is the cash sweep. It is the schedule most often examined in a modelling test.
Where it lives
The same schedule in each model that carries it, with the rows to open. Open a model in the browser, go to the sheet, and click the lines.
- Assumptions, rows 33–37: Minimum cash balance, Term loan scheduled amortisation, Term loan interest rate, Revolver interest rate…
- Income Statement, rows 20–25: Interest expense, Interest income, Profit before tax, Tax…
- Cash Flow, rows 16–20: Term loan repayment, Dividends paid, Cash flow before revolver, Revolver draw / (repayment)…
- Debt, rows 6–9: Opening cash, Cash flow before revolver, Cash before revolver, Minimum cash
- Debt, rows 12–15: Opening balance, Scheduled amortisation, Closing balance, Interest on term loan
- Debt, rows 18–21: Opening balance, Draw / (repayment), Closing balance, Interest on revolver
- Debt, rows 24–29: Total interest expense, Interest income on opening cash, Total debt, Net debt…
- Assumptions, rows 18–28: Revolver commitment, Revolver drawn at close, Revolver interest rate, Term loan B, multiple of LTM EBITDA…
- Operating Model, rows 12–14: Amortisation of financing fees, Interest expense, Interest income
- Debt, rows 6–10: Opening cash, Free cash flow before debt repayment, Cash after mandatory amortisation, Minimum cash…
- Debt, rows 13–16: Opening balance, Draw / (repayment), Closing balance, Interest
- Debt, rows 19–23: Opening balance, Mandatory amortisation, Cash sweep, Closing balance…
- Debt, rows 26–28: Opening balance, Closing balance (bullet), Interest
- Debt, rows 31–38: Closing cash, Interest income on opening cash, Total interest expense, Total debt…
- Pro Forma EPS, rows 12–15: Less interest on new debt, Less interest forgone on cash used, Less amortisation of financing fees
What a reviewer looks for
- A sweep that runs before mandatory amortisation.
- Interest on average balances without an iteration switch.
- A revolver that draws to fund the sweep.
- A tranche allowed to go negative because the repayment was not capped at the balance.
Learn it, then build it
Understand · Primer
LBO Mechanics & Returns
Build · Lab · ~60 min
LBO Modelling Test
Sit the one-hour test under a clock, in the browser or in your own workbook, and get every line of the build marked.
Build · Lab · ~15 min
Capital Stack Challenge
Finance a real buyout from revolver to equity, hold it through a shock, and explain every layer against the deal the sponsor actually did.
Build · Lab · ~15 min
Optimal Capital Structure
Explain why more debt stops helping: watch coverage, rating and spread move as leverage rises until WACC turns.
Read · Guide · 13 min
How to Build an LBO Model: The Build Order That Survives a Modelling Test
Read · Guide · 11 min
Credit and Covenant Modelling: What a Lender Actually Tests
Read · Guide · 9 min
The Private Equity Modelling Test: What to Expect and How to Prepare
Vocabulary: PIK Interest, Covenant, Leverage Model, Net Debt.