Financial modeling Overview

A financial model is simply a tool that’s built in Excel to forecast a business’ financial performance into the future.  The forecast is typically based on the company’s historical performance and requires preparing the income statement, balance sheet, cash flow statement and supporting schedules.

Financial Modeling is the task of building an abstract representation of a financial decision-making situation. This is a mathematical model, such as a computer simulation, designed to represent the performance of a financial asset or a portfolio, of a business, a project, or any other form of financial investment.

  • MBA students
  • Commerce graduates
  • Investment Bankers
  • Business Analysts
  • Professionals in Corporate Finance
  • Project Finance or any finance and commerce professionals looking forward to strengthen their knowledge of financial modeling techniques and implication.

Financial Modeling is critical to any startup or to an existing business seeking to capitalize on the next level.  When the term “Financial Modeling” resonates, most companies think of a three to five-year financial analysis that is attached to a Business Plan. While this definition is accurate, financial modeling applications are more extensive and necessary to provide vision, to garner early-stage investors, and to provide stakeholders with valuable information.

 

 Financial modeling Syllabus 

Basic Excel :

  • Formatting of Excel Sheets
  • Use of Excel Formula Function
  • Advanced Modelling Techniques
  • Data Filter and Sort
  • Charts and Graphs
  • Table formula and Scenario building
  • Lookups: Vlookup Match & offset, pivot tables

Financial Statement Analysis :

  • Introduction to Financial Statement Analysis
  • Financial Reporting Mechanics
  • Understanding Income Statement, Balance Sheet
  • Cash Flow Statement
  • Financial Analysis Techniques
  • Inventories, Long-Lived Assets
  • Non-Current Liabilities
  • Financial Statement Application

Financial Ratios :

  • Ratio analysis of industries
  • Du point Analysis
  • Peer to peer analysis
  • Preparation of Financial Analysis report on an industry

Financial Management & Corporate Finance :

  • Time value of money
  • Long-term financing
  • Cost of capital
  • Measure Of Leverage

Project Finance :

  • Project evaluation; stage of project; construction & development phase
  • funding during the investment phase
  • costs during the investment phase
  • life of the project
  • decision making
  • cash flow waterfall & resolve circular reference problem in interest during construction.

Equity Research Modelling :

  • Prepare an Income Statement, Balance sheet, Cash Flow Statement, Geographic Revenue Sheet, Segment Revenue Sheet, Cost Statement, Debt Sheet, Analyze Revenue Drivers
  • Forecast Geographic & Segment Revenues, Cost Statement, Debt, Income Statement, Balance Sheet, and Cash Flow Statement.
  • Performa Adjustments, Income Statement – Compute Margins, Balance Sheet -Compute Ratios
  • Cash Flow Statement Projection, Valuation- Discounted Cash Flow Method (DCF), Valuation – Relative Valuation (Football Field Chart)
  • Valuation – Assumptions for Valuation Model, Prepare Valuation Model, Prepare Presentation Sheet, Prepare Company Overview, Sector Overview

VBA and Macros

  • Understanding Macros and VBA
  • Recording Macros Understanding basics of coding
  • Understanding objects and
  • Control statements in VBA code
  • Application of macros to Financial modeling
  • Developing solution to circular reference problem
  • Developing sensitivity table
  • Developing scenario analysis
  • Developing simulation
  • Examples will be based on Project Models

Investment Banking M & A

  • Introduction to Investment Banking
  • Merger and Acquisitions
  • Types of M&A: Merger, Acquisition
  • Consolidation Spin-off
  • Drivers for M&A
  • Accounting for Mergers: Purchase
  • Method & Pooling Method
  • Differentiate between financing and
  • Operating synergies
  • M&A Regulatory Environment
  • Developing M&A Models: Integration of
  • Financial Statements between (Target and Acquirer),
  • Valuation -DCF, Relative and Transaction
  • Comps
  • Developing Merger Model
  • Developing Synergies

SQL

  • Introduction to Databases
  • Terminologies – Records, Fields, Tables
  • Database normalisation
  • Primary Key
  • How data is accessed
  • Introduction to SQL – Table creation
  • SQL Syntax, SQL dataTypes, SQL Operators
  • Table creation in SQL: Create, Insert, Drop, delete and updating
  • Introduction to SQL – Table access & Manipulation  Select with Where Clause (In between, logical operators, wildcards, order, group by)
  • SQL constraints, Concepts of Join – Inner, Outer
  • Case Study

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