- What is a financial modelling→Multi disciplinary, powerful communication tool for forecasting financial statement, based on different parameters and assumptions.
- Attributes of a good financial model
- Dynamic - Changes are easily model, which runs across the model
- Flexible - Easily expandable
- Intuitive - Others can understand logic
- Transparent - Easy to follow. No giant formula
- Printable - It can be printed
- Transferable - Others can use the model and make updates to it
- Storytelling - Tell a story in a seamless flow
- Competencies required to build professional financial model
- Design
- Accounting understanding
- Business operations
- Finance
- Use cases of financial models for decision making
- Valuation
- Credit model
- Operational issues
- Risk & volatility
- Mergers & acquisitions
- So many models are a mess
- Aspects where a financial model should work well
- Electronically - Every formula work well and needs to make sense
- On paper - Models need to work well on paper or pdf