7.1.5.1 Current Profile Based Increase

This method increases the total value of the side of the balance sheet that is lower than the other side in the proportion of the current profile. Suppose the spot balance sheet position and the current profile is as follows:

Table 6-18 Spot balance sheet position

Assets Side	Asset Balance	Current Profile – Assets	Liabilities Side	Liability Balance	Current Profile – Liabilities	Liability Balance Excluding Equity	Revised Current Profile – Liabilities
Cash	300	35.29%	Equity	200	23.53%
Asset 2	250	29.41%	Liability 1	300	35.29%	300	46.15%
Asset 3	200	23.53%	Liability 2	350	41.18%	350	53.85%
Asset 4	100	11.76%
Total	850	100%	Total	850	100%	650	100%

The balance sheet position after forward balance calculation is as follows:

• Total Assets = 1000
• Total Liabilities plus Equity = 1200

Here, the assets side is lower than the liabilities side by 200 (1200-1000). As per this method, the side which is lower is adjusted and made equal to the other side in order for the balance sheet to be balanced. The difference on the assets side is allocated based on the current asset profile as follows:

Table 6-19 Difference on the assets side

Assets Side	Current Profile (a)	Forward Balance (b)	Adjustments to Assets (c = a* Difference)	Adjusted Forward Balance (d = b + c)
Cash	35.29%	350	70.58	420.58
Asset 2	29.41%	270	58.82	328.82
Asset 3	23.53%	250	47.06	297.06
Asset 4	11.76%	130	23.52	153.52
Total	100.00%	1000	200	1200

Note:

If the liabilities side is increased, equity is excluded from any adjustments. The total difference is only allocated to all liabilities other than equity, based on the revised current profile calculated for all liabilities excluding equity.