Dates                                                                
 
  
22-23 October 2008
2-3 February 2009
22-23 June 2009

Course Overview

This is a two day workshop for constructing a complete financial model. Participants will gain the ability to correctly construct financial models that are accurate, operationally robust and that can add genuine value in understanding an assignment's dynamics. This will include the utilisation of tools for auditing and testing models to ensure accuracy, gaining a clear understanding of a structured methodology that provides a framework for all analytical modelling and mastering a set of transferable techniques that can be applied to many different assignments to improve speed, efficiency and accuracy.

The workshop explores the aims and outlines governing model design and construction, how to design and build in accuracy from the outset, best practice modelling techniques, techniques for efficient construction to provide inherent reliability and robustness, understanding and avoiding common pitfalls and running sensitivities and what-if analysis to gain information about performance.

It is a highly practical workshop and involves building a complete model. Delegates start with a template and construct a model in stages. They receive a full pack of Excel software and templates for future reference as part of the course materials.

Each participant will be required to bring a laptop running Microsoft Office with CD-Rom to the seminar.

Course Content

Day One

Module 1 - Spreadsheet Best Practice
Outline of financial modelling
Examples of Excel financial models
Useful Excel features and techniques
Systematic Excel standards
Case outline – introduction

Exercise: reworking existing financial model

Module 2 - Auditing and Testing
  Examples of spreadsheet errors
  Essential testing and auditing techniques
  Example: testing financial analysis model with cash flows
    and ratios

Exercise: debugging and checking a financial model

Module 3 - Forecasting Models
  Review of forecasting methods
  Understanding financial ‘drivers’ for analysis, valuation and
    project models

Exercise: deriving forecast free cash flow and ratios

  Linear methods
  Smoothing and seasonality
  Macro forecasting and regression

Exercise: producing a forecast with time series analysis

Day Two

Module 4 - Risk and Sensitivity
Risk and multiple answers
Scenario techniques
Advanced financial functions

Exercise: adding sensitivity to the case model

Module 5 - Risk and Simulation
Elements of a simulation model
Building blocks in Excel
Monte Carlo simulation methods
Example: using simulation in the case model to gain more
  understanding of the potential variance

Module 6 - Optimisation and Targeting
Overview of optimisation and targeting
Goal seek and Solver methods
Example: targeting and optimisation

Module 7 - Management Analysis
Consolidating and summarising data

Exercise: consolidating data from different sources

Excel report manager

Exercise: pivot tables

Techniques for summarising data

Exercise: producing a management report