Data entry

Most of the data required for the model to work is entered into the computer in the first 9 pages of the model. These can each be accessed by scrolling down the screen using the key or <page down> key. The data required for the model is explained in the next few pages.

Page 1: Concession details

This first page contains some very general information about the concession. Details of each of the data entry cells are given in Table 1 and page 1 of the sample model is shown in Figure 2.

The first five entries (cells C32 to C36) are mainly for reference. All text entries must be preceded by a quotation mark (eg. '24th May 1997 not 24th May 1997). Alternatively, the date could be entered with the month first (eg. May 24th 1997).

Cell C34 specifies the concession size. This information is used later to calculate tax liabilities levied on land area. The other four cells in this box are for information only. Labelling the date of the work, who undertook the revisions and to where the work applies greatly assist any future application of the models.

The first year of the investment (ie. usually the current year) is entered into cell D38. This number is used to identify each of the years in the output tables later on. The length of the investment is entered into cell D39 and is used to identify the last year of the investment in the output tables. This number must be between one and twenty because the model only has the capacity to construct a twenty year cash-flow. Time remaining until the second harvesting cycle commences is entered in cell D40. Forest concessions usually operate on a thirty five year cutting cycle.

Table 1  Details of data entry cells on page 1 of the Forest Concession Model

Data required	Cell location	Data type	Check	Critical	Remarks
Name of concession	C32	text	ü		useful for future reference
Province	C33	text	ü		useful for future reference
Concession size	C34	number	ü	ü	used to calculate land tax obligations
Model's author	C35	text	ü		useful for future reference
Date of last revision	C36	text	ü		useful for future reference, must start with a quotation mark
First year of investment	D38	number	ü	ü	should be > 1996
Period of investment	D39	number	ü	ü	must be between 1 and 20
Time until second cycle	D40	number	ü	ü	between 1 and 35 under TPTI
Price base	D41	number	ü		for future reference (if required)
Exchange rate used	D42	number	ü		used elsewhere (optional)
Forest loss factor	D43	number	ü	ü	included in later calculations
Working days per year	D44	number	ü	ü	used to calculate productivity
Hours per working day	D45	number	ü	ü	used to calculate productivity
Total area	F49-H49	number	ü	ü	used to calculate annual felling area. For any data entered under other areas a corresponding entry MUST be made on page 9.
Annual felling area	F50-H50	number	ü	ü	used to calculate production. For any data entered under other areas a corresponding entry MUST be made on page 9.
Yield	F50-H50	number	ü	ü	used to calculate production. For any data entered under other areas a corresponding entry MUST be made on page 9.

The price base, the year to which all cost and benefit data have been adjusted for inflation, is entered in cell D41. This will usually be the same as the first year of the investment. This is only used for reference. It is useful to note the price base in case the figures used in the model are required for a similar analysis in later years, in which case the price base must be known in order to inflate the data to the price level in a later year.

Figure 2    Page 1 of the Forest Concession Model

The Rp/US$ exchange rate is entered into cell D42. This is also only used for reference. Most costs and benefits in the model should be entered in US$, so this cell has been given the name "EX" in order to easily convert costs and benefits denominated in Rp into US$ amounts in other data entry cells (i.e. amounts in Rp can simply be entered into other cells as <amount/EX> and will be automatically converted to US$).

The forest loss factor is entered into cell D43. This states the decrease in forest area over the investment period. This figure is expressed as a percentage of the concession size. The decreasing area under forest cover is taken into account when future income and benefits are calculated.

Working days per year and working hours per day are entered in cells D44 and D45 respectively. This data is used later in the model in productivity calculations to generate independent estimates of certain roading, planning and harvesting related activities.

The final table on page one gives forest details. The table is split between areas under TPTI and other areas. Users can enter the area of virgin forest and the area of forest already onto the second cutting cycle in cells F49 and G49. Yields from the area under second cycle management will be less than virgin areas. Yield data (cubic metres per hectare) is entered in cells F51 and G51. Cells H49 to H51 allow the user to enter information on any other felling activities which are being undertaken in the concession. This can include areas of forest which are being cleared to make way for logging roads and areas of conversion forest.

It is critical that if forest cleared from other areas is included in the appraisal then price and royalty information must also be entered in the <logs from other areas> section on page nine. This information must be entered, even if it is the same as for logs harvested in TPTI areas. If it is not, subsequent calculations undertaken in the model will be inaccurate.

TPTI, the Indonesian selective cutting system, requires concessionaires to follow a set of forest management practices designed to allow the natural forest to recover in the thirty five year gap between first and second cutting cycles. Pages two to five cover the costs of these operations.

Page 2: Planning and surveying costs

The second page of the model contains information about planning and surveying costs. This information is used, along with the next three pages, to calculate the costs of forest management. Details of each of the data entry cells are given in Table 2 and page two of the sample model is shown in Figure 3.

The first table on page two is for information on the main planning costs in a forest concession. Costs incurred in the production of twenty year and five year plans, environmental impact analysis and a village development diagnostic survey are depreciable under the rules of the Indonesian standard forestry accounting system (SAK 32). The costs entered in each of these cells should therefore be the depreciated annual cost. Under the SAK system, this is the format in which companies should provide this data in annual financial reports. All data is entered in cubic metres per hectare (hectarage refers to the size of the annual cutting area).

The second table on this page refers to mapping and surveying costs. The costs entered for aerial photography and mapping should be the annual depreciated cost of these operations, in accordance with the specifications of SAK 32. Again costs are based on the cost per hectare for the annual cutting block.

Cells G65 to G67 provide model estimates for the cost of mapping and surveying. Similar model estimates appear on other pages of the model and will be discussed in greater detail later. They are referenced from the calculation tables section at the end of the model and provide a default value which will acquiesce to any value entered in the corresponding data entry (yellow coloured) box. If the value to be entered in the yellow box is zero ie. a company does not provide data on this topic, or it is included along with other data, a text entry must be used, for example <zero> or <included elsewhere>. This is because Lotus spreadsheet software equates a numerical zero with a blank cell and does not register the zero value in later calculations.

Having data placed under correct headings is not important, in so far as calculations undertaken by the model are not affected, provided running totals are correct. Aggregated data can be entered in a single cell and the remaining cells in a table can be annotated so that other users can trace steps taken in the analysis.

Table 2     Details of data entry cells on page 2 of the Forest Concession Model

Data required	Cell location	Data type	Check	Critical	Remarks
Production of 20 year plan	F57	number	ü		Enter depreciated annual cost (US$/ha. of annual felling area)
Village development diagnostic survey	F58	number	ü		Enter depreciated annual cost (US$/ha. of annual felling area)
Environmental impact analysis	F59	number	ü		Enter depreciated annual cost (US$/ha. of annual felling area)
Production of 5 year plan	F60	number	ü		Enter depreciated annual cost (US$/ha. of annual felling area)
Production of annual plan	F61	number	ü		Non-depreciable annual operating cost
Aerial photography	F65	number	ü		Enter depreciated annual cost (US$/ha. of annual felling area)
Mapping work area	F66	number	ü		Enter depreciated annual cost (US$/ha. of annual felling area)
Pre-felling inventory	F67	number	ü		US$/ha. of annual felling area
Boundary marking cost	F71	number	ü		US$/km marked
Length of boundary to mark	F72	number	ü		km
Duration of boundary marking	F73	number	ü		Time before remarking must be undertaken
Planning overhead	F74	number	ü		Can enter any other planning costs here

The final planning and surveying table covers other planning costs such as boundary demarcation and planning overheads.

Figure 3    Page 2 of the Forest Concession Model

Page 3: Harvesting costs and levies

The third page of the model contains information on harvesting costs and levies. Details of each of the data entry cells are given in Table 3 and page three of the sample model is shown in Figure 4.

The first table on page three breaks down into component parts the cost of felling and removing logs to processing sites. Skidding costs include the cost of skid trail construction. The model assumes that skid trails are not maintained in future years, are non-depreciable and are therefore treated differently from other roads constructed and maintained around the forest concession. With the exception of bucking costs and other costs, the model calculates independent estimates for harvesting operations. If better data is held by the model user, this can be entered and will over-ride the model estimates. Harvesting costs are totalled in cells F89 and G89.

Table 3     Details of data entry cells on page 3 of the Forest Concession Model

Data required	Cell location	Data type	Check	Critical	Remarks
Felling	F80	number	ü		-
Bucking	F81	number	ü		-
Skidding	F82	number	ü		Includes the cost of skid trail construction
Loading	F83	number	ü		-
Hauling	F84	number	ü		-
Unloading / sorting	F85	number	ü		-
River loading	F86	number	ü		-
River transport	F87	number	ü		-
Licence fee	F92	number	ü		-
Land & buildings tax	F93	number	ü		Calculated using data entered in C34
Reforestation fee	F94	number	ü		Dana Rebosasi
Grading fee	F95	number	ü		-
Village development	F96	number	ü		Bina Desa

Figure 4    Page 3 of the Forest Concession Model

If data provided by companies is not in a disaggregated form, it can still be entered in cells for which it is available and the estimates for costs already included in the aggregated data over written by inserting a text entry which either states in which cell the corresponding data is included, or by simply entering <zero>. For example, a company may include river transport and river loading as a single entry in their annual accounts. This aggregated data can be entered in cell F86 (under river loading) and in F87 (under river transport) can be inserted a note drawing attention to this fact, thereby switching of the model estimate for river transport.

The second table on page three contains the official payments which concessionaires must make to the government, excluding the forest products royalty, which is entered later on page nine. These payments are totalled in cell F97.

Page 4: Forest management costs

Following harvesting, felling blocks require tending to ensure that they recover fully and produce good yields of timber for the second harvest. Data for these maintenance operations is entered in the first table on page four, shown in Figure 5. Details of each of the data entry cells are given in Table 4.

Figure 5    Page 4 of the Forest Concession Model

Table 4     Details of data entry cells on page 4 of the Forest Concession Model

Data required	Cell location	Data type	Check	Critical	Remarks
Liberation cutting	F103	number	ü		-
Post-felling inventory	F104	number	ü		-
Planting / enrichment	F105	number	ü		-
Maintenance I	F106	number	ü		-
Maintenance II	F107	number	ü		-
Thin I	F108	number	ü		-
Thin II	F109	number	ü		-
Thin III	F110	number	ü		-
Protection	F111	number	ü		-
Seedling production	F115	number	ü		-
Fire protection	F119	number	ü		-
Forest management overheads	F120	number	ü		-

TPTI sets out a timetable for performing post harvesting activities. Column C displays the year in which each operation is performed and the year in which the model builds this into the cash flow. For a new concession, the cost of TPTI maintenance will rise each year until, after twenty years, the concession will have old felling blocks requiring each of the forest management activities in each financial year, and costs will reach a plateau. Costs entered in the yellow shaded data entry cells will overwrite estimates produced by the computer and displayed in cells G103 to G111.

The second table on page four, nursery costs, functions in the same way. As before, if the new value for any of these operations is zero, a text entry must be placed in the yellow box.

Other management costs are entered in the last two rows of this page. The model does not produce estimates for these costs.

Page 5: Camp capital and operating costs

Page five treats capital investments for the first time in the model. Capital costs are considerably more complex to deal with than operating costs because capital costs depreciate over the working life of the investment.

Capital invested in the concession is split into three categories:

1.	initial capital (ie. buildings and machinery which are acquired at the start of the investment);
2.	working capital (ie. cash and stocks of inputs and outputs required for day to day operations); and
3.	replacement capital (ie. machinery and buildings which have to be replaced during the investment period).

Page five deals with new and existing base camp capital. Details of each of the data entry cells are given in Table 5 and page five of the sample model is shown in Figure 6.

Table 5     Details of data entry cells on page 5 of the Forest Concession Model

Data required	Cell location	Data type	Check	Critical	Remarks
New camp investment	D126 to D133	number	ü		Value of new (current year) investments
Existing camp investment	E126 to E133	number	ü		Current book value of existing investments
Total depreciation period	F126 to F133	number	ü		Expected working life of the investment
Remaining depreciation period	G126 to G133	number	ü		Time remaining of the expected working life
Camp operating costs	E138 to E141	number	ü		Enter non-depreciable camp costs

Figure 6    Page 5 of the Forest Concession Model

The cost of new investments are entered in cells D126 to D133. New investments are investments made in the current year. The value of existing investments (the current book value) is entered in the range E126 to E133. The total depreciation period and the number of years remaining out of this estimated working life are entered in cells F126 to F133 and G126 to G133 respectively. The cash flow tables in section three of the model include the capital costs in the calculations and also introduce replacement capital into the cash flow using the information entered on the depreciation of capital.

The second table on page five deals with camp operating costs. Operating costs do not require any depreciation calculation. The model does not produce independent estimates for these costs. Costs per year are entered in US$.

Page 6: Mobile capital requirements

Large amounts of mobile capital are required in initial capital investments for felling, roading and transport operations. Mobile capital has a short working life when worked to the very limits of its engineering in demanding forest terrain. Consequently forest concessions also have a large outlay for replacement mobile capital. Page six (displayed in) deals with concession mobile capital. Data to be entered is summarised in Table 6 below.

Table 6     Details of data entry cells on page 6 of the Forest Concession Model

Data required	Cell location	Data type	Check	Critical	Remarks
Unit cost	C150 to C164	number	ü		-
Number currently available	D150 to D164	number	ü		-
Estimated future requirements (input)	F150 to F164	number	ü		Will overwrite data shown in the range E150 to E164
Depreciation period	G150 to G164	number	ü		-
Unit life	H150 to H164	number	ü		Working life of the machinery

Mobile capital unit cost data is entered in range C150 to C164. All mobile capital is depreciable under the Indonesian standard forestry accounting system (SAK 32), with the exception of chainsaws which have an estimated working life of one year. The number of units of each type of capital available is entered in the range D150 to D164. The model estimates future capital requirements in cells E150 to E164, but if a concession has different future requirements to those produced by the model then the default values can be over written by entries made in the input column (cells F150 to F164).

Information about the depreciation and unit life of these capital assets is entered in columns G and H. For example, if it is assumed that a bulldozer will work for eight years, <8> should be entered into cell G151. These figures are used to calculate the annual allowance for depreciation and to introduce replacement capital expenditure into the cash flows in section three of the model.

Figure 7    Page 6 of the Forest Concession Model

Page 7: Other capital requirements

The seventh page of the model (figure 8) contains information about other capital requirements. Any mobile capital not stated on page six can be entered here. The table is laid out in the same style as on page six, however no independent estimates are provided by the computer. This table is useful for concessions which operate under unusual circumstances or in unusual areas and therefore have unusual capital needs. Data entry cells are discussed in table 7.

Replacement stationary capital is entered in the second table on this page. The year of the investment cycle (one to twenty) in which existing capital must be replaced is entered in the range D182 to D190. Replacement cost is entered in the range F182 to F190 and the working life (and hence depreciation period) of replacement capital is entered in the range H182 to H190.

Figure 8    Page 7 of the Forest Concession Model

Table 7     Details of data entry cells on page 7 of the Forest Concession Model

Data required	Cell location	Data type	Check	Critical	Remarks
Capital items	A173 to A177	text	ü		Enter any additional capital items
Unit cost	C173 to C177	number	ü		-
Number currently available	D173 to D177	number	ü		-
Estimated future requirements (input)	F173 to F177	number	ü		Will overwrite data shown in the range E150 to E164
Depreciation period	G173 to G177	number	ü		-
Unit life	H173 to H177	number	ü		Working life of the machinery
Replacement capital item	A182 to A190	text	ü		Enter item of camp capital to be replaced
Year	D182 to D190	number	ü		Enter year of investment cycle in which capital must be replaced
Amount	F182 to F190	number	ü		Cost of replacement
Depreciation period	H182 to H190	number	ü		Working life of capital

Page 8: Roading cost

Roading costs make up a substantial and complicated proportion of forest concession expenditure. In building roads, both capital and operating costs are incurred, while in some cases substantial amounts of saleable timber are recovered to offset part of this outlay. Forest areas cleared for roads, if known, can be entered in H50 along with other forest details and a yield estimate entered in H51.

Page eight (figure 9) deals only with the costs incurred in laying a road network. Data entry cells are described in Table 8.

Figure 9    Page eight of the Forest Concession Model

Roading capital details are entered in a table following the same format as on page six. The unit cost is entered in thousands of US$ in the range C195 to C200. Current capital stock is entered in the range D195 to D200, computer generated workstudy estimates appear in the range E195 to E200, but will acquiesce to any entry made in the range F195 to F200. Depreciation period and unit life are entered in the range G195 to H200. The road depreciation period (different from the depreciation period used for road cutting capital) is entered in cell G201. This is usually twenty years.

Table 8     Details of data entry cells on page 8 of the Forest Concession Model

Data required	Cell location	Data type	Check	Critical	Remarks
Capital items	A173 to A177	text	ü		Enter any additional capital items
Unit cost	C173 to C177	number	ü		-
Number currently available	D173 to D177	number	ü		-
Estimated future requirements (input)	F173 to F177	number	ü		Will overwrite data shown in the range E150 to E164
Depreciation period	G173 to G177	number	ü		-
Unit life	H173 to H177	number	ü		Working life of the machinery
Construction input	F205 to F207	number	ü		Will over-write corresponding model estimate
Maintenance input	H205 to H207	number	ü		Will over-write corresponding model estimate
Length of existing roads	F211 to F213	number	ü		-
Planned roading density	H211 to H213	number	ü		-

Table two on page eight covers data on the operating costs of road construction and maintenance. These costs have been split between the different types of roads assumed by the model to exist in a forest concession area. Corridor roads are roads which link the forest concession to the national road network and may in fact even be part of the national road network. Main roads are arterial routes through the concession, from which branch roads emanate, providing links to felling areas. Branch roads are not skid trails, the construction cost of which is included under harvesting costs. Branch roads, like main and corridor roads, are considered to be depreciable investments, while skid trails are not. Roading is classified in this way by SAK 32, the Indonesian standard forestry accounting system.

Page 9: Sales and other financial details

To calculate sales revenues, total production is divided into species groupings. The common species groupings are Meranti, Rimba Campuran (mixed species) and Kayu Indah (fancy wood). These three species groupings can be seen in Figure 10.

Royalty payments due on each species vary. The current IHH royalty for each of the species groupings must be entered in the range C221 to C225. Information on current royalty rates can be obtained from a pamphlet published every six months by the Directorate General of Forest Utilisation (DitJen PH) in the Ministry of Forestry. The proportion of each species harvest, expressed as a percentage of the total harvest, is entered in the range D221 to D225.

Figure 10 Page 9 of the Forest Concession Model

Current log prices are entered in the range F221 to F225. Price details are required for each species grouping. The price required is the delivered price of roundwood, since transportation costs have already been included earlier in the model.

The second section of the first table on page nine covers logs from other areas. Any harvest from non-TPTI areas, entered in the range H49 to H51, must have a corresponding entry on page nine, otherwise later calculations will be inaccurate.

The final data entry cells on page nine are for entering other financial information. The proportion of the total initial capital requirements which will be funded by the investor (ie. the investor's equity share in the investment) should be entered into cell D235. The rest of the initial capital requirement will be funded by borrowing. The debt and equity requirement affects the debt repayment calculations on page eleven of the model and the NPV results given in the output tables. The interest rate on borrowed funds should be entered into cell H234. The corporate tax rate should be entered into cell H235.

Table 9     Details of data entry cells on page 9 of the Forest Concession Model

Data required	Cell location	Data type	Check	Critical	Remarks
Logs from TPTI areas	A221 to A225	text	ü		Species group (for revenue purposes)
Royalty	C221 to C225	number	ü		IHH rate per cubic metre
Output (percent)	D221 to D225	number	ü		Percentage of each species group harvest
Delivered price	F221 to F225	number	ü		-
Real price change	H221 to H225	number	ü		-
Logs from other areas	A227 to A230	text	ü	ü	If any data entry has been made in cells H50 and H51 a corresponding entry MUST be made here
Royalty	C227 to C230	number	ü		As above
Output (percent)	D227 to D230	number	ü		As above
Delivered price	F227 to F230	number	ü		As above
Real price change	H227 to H230	number	ü		As above
Equity	D235	number	ü		Share of investment financed by the investors own funds
Interest rate	H234	number	ü		Current interest rate
Corporate tax rate	H235	number	ü		Current tax rate

Data entry cells on other pages

There are a number of pages in the worksheet and output sections of the model in which users can enter additional data. Some calculation tables also consist largely of data entry cells. The calculation tables will be discussed in greater detail later, this section describes cells in the worksheet and output sections which can be changed by users.

The proportion of operating costs required as working capital, the number of annual loan payments and the value of existing mobile capital as a proportion of unit cost are entered onto page ten. This information is used later in cash flow calculations. Page ten is shown below in Figure 11.

The model also allows the user to enter additional revenues in each year of the investment directly into the cash-flows presented in the output tables. Any such revenues can be entered into cells E371 to X371 on page thirteen. Any costs incurred over and above those already stated in the data entry can be entered into cells E403 to X403 on page fourteen. These additional costs and benefits will then be incorporated into the final cash flow.

Figure 11 An example of page 10 of the Forest Concession Model

Data has to be entered into the model on page seventeen. The model will calculate the net present value of the investment at three different discount rates and these should be entered into cells D517 to D519. The default values have been selected to represent a low, average and high discount rate for Indonesia, based on current interest rates.

In order to calculate IRR it is also necessary to specify an estimated IRR before the model will calculate the IRR exactly. The default estimates already present in the sample model should be sufficient for most calculations, but if the model is displaying an error message <ERR> in one of the cells showing the IRR, alternative values should be tried in cells S524 to S526 on page seventeen.