Business Case Modelling

Course Overview

Business Case Modelling will allow users to improve the reliability, quality and construction of their Excel models.  Financial modelling demands a logical consistent approach and this workshop builds a business case model through a series of practical stages.

Upon completion, attendees will have a comprehensive understanding of advanced modelling, as well as how each technique can practically be applied through the use of Excel.

Course Objectives:

On completion of this highly practical, hands-on training course, attendees will:

• Be able to build a financial model from a blank sheet
• Be able to design models which minimise errors
• Be able to write models which can be maintained and augmented in the future
• Be able to develop models with advanced techniques such as risk and sensitivity

Workshop Structure:

The workshop starts with a discussion of modelling techniques and methods and agrees the objectives for a business case model.  Each session reviews the next stage of the model in terms of the financial theory, modelling techniques and potential difficulties and delegates build the model in stages. 

This is an intensive workshop and delegates will be spending the majority of the time on practical model building tasks. With the help of the Course Director and through a proven step-by-step approach, delegates will leave this intensive two-day workshop with the confidence and ability to apply advanced modelling techniques in Excel effectively.

Workshop Methodology:

This programme will be delivered through a practical and interactive case study and worked examples, demonstrating how and why each technique is used.  Emphasis is placed on the delegates gaining practical, hands-on experience of the design and construction of financial models in Excel. Attendees will also benefit from formal lectures and group discussions.  Comprehensive product notes and modelling software will be provided for future reference.

Pre-requisite:

Attendees need basic Excel skills to be able to participate fully in the modelling workshops.  For example:

• Opening and closing Excel files
• Excel screen menu and standard toolbar
• Auto fill
• Moving around a worksheet
• Moving around the sheets in a workbook
• Creating files
• Deleting files and individual sheets
• Changing column width and row height
• Entering simple formulas
• Chart wizard
• Entering labels
• Cell referencing
• Centring titles and merging cells
• Simple cell formatting Number formats
• Changing font sizes and colours
• Copy, cut and pasting cell contents
• Inserting graphic objects
• Custom views
• Previewing worksheets
• Printing documents and ranges

Basic Excel functions and the ability to insert functions:

• Basic financial functions – NPV, IRR, NPER, RATE, PV, PMT, FV
• Logic functions – IF, AND, OR

In addition attendees need some basic finance knowledge for the general modelling workshops such as:

• Present value
• Future value
• Nominal and compound interest rates
• Net present value
• Internal rate of return

Course Content

Modelling Style

• Introduction
• Modelling style
• Examples of poor modelling style
• Systematic Design Method
• Case study outline
• Required inputs and outcomes
• Risk factors
• Model planning

Model Template

• Setting up a basic template
• Key input variables
• Layout methods
• Flexible tiiming
• Input sheets
• Useful Excel techniques and shortcuts
• Styles, validation, names

Revenue and Costs

• Operational revenue
• Volume drivers
• Counters
• Efficient coding techniques
• Fixed and variable cost
• Real and nominal considerations

Margin

• Operating margin
• Debt funding
• Capital structure
• Amortisation methods
• Fixed asset schedule
• Depreciation tables
• Avoiding links and circular references
• Straight line, reducing balance and other methods

Cash Flow

• Basic income and balance sheet
• Adding cash flow
• Cash flow schedule
• Integrity checks

Returns

• Accounting returns
• Terminal value
• Project returns – DSCR, LLCR
• Cumulative and simple discounting
• Single answer NPV, IRR, MIRR
• Discussion of project attractiveness

Sensitivity

• Common sensitivity errors
• Comprehensive scenario manager setup
• Sensitivity analysis
• Trends
• Further analysis e.g. contingencies
• Dashboard analysis

Executive Summary and Audit

• Model checks
• Basic audit techniques
• Excel techniques and shortcomings
• Executive summary
• Charts
• Final review

Workshop Summary

• Workshop summary
• Key points
• Future planning
• Workshop actions

Delivering this course in-house for you to a number of participants could be very cost effective. Please call us on 020 7387 4484 to discuss this further.

If you have any questions about this seminar please write to us at post@redcliffetraining.co.uk.