Our Approach

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All our financial models are designed using a tried and trusted methodology honed over 25 years of experience using widely acknowledged best practice.

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The key to each of our models is to take complex financial data and transform it into useful information which can help you to define and achieve your short-term and long-term business goals.

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In simple terms a successful financial model needs to do 3 things:

• address the business need identified

• be easy to use and understand

• be error free

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To ensure the model we create achieves these 3 things we follow a 5 step plan when building each model.

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Our 5 step plan

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1.       Understand the business need and intended goal

2.       Keep the model as simple as possible

3.       Plan the model structure

4.       Build structural integrity

5.       Test the model

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1. Understand the business need and intended goal

• Fully understand the business need and how it will be addressed by the model.

• Determine who the end users are, how they will use the model and what outputs are required.

 

2. Keep the model as simple as possible

• Only include inputs and outputs which improve the usefulness of the model in meeting the business need.

• The simpler the model, the easier it will be to understand and use, and the lower the risk of error.

 

3. Plan the model structure

• Plan how the inputs, processing, and outputs will be laid out.

• Try to keep all inputs in one place, as much as possible, in order to have a quick overview of all inputs and their impacts on the model.

 

4. Build structural integrity

• Utilize Excel tools to protect data integrity, such as “data validation” and “conditional formatting” to identify and prevent errors.

 

5. Test the model

• Ensure that the model is completely functional and works as expected.

• Stress test the model by putting in scenarios that are easy to sense check such running out of cash or flat rate growth.