Financial Modelling & Forecasting
Introduction:
Financial modeling is the task of building an abstract representation (a model) of a real-world financial situation. It’s a model designed to represent the performance of the financial assets or portfolio of a business.
A financial model is simply a tool that’s built in spreadsheet software such as MS Excel to forecast a business’ financial performance into the future. The forecast is typically based on the company’s historical performance, assumptions about the future, and requires preparing an income statement, balance sheet, cash flow statement, and supporting schedules (known as a 3 statement model). From there, more advanced types of models can be built such as discounted cash flow analysis (DCF model), leveraged-buyout (LBO), mergers and acquisitions (M&A), and sensitivity analysis.
Objectives:
The course is designed to cover 3 statement financial model and Discounted CashFlow: time value of money, capital budgeting (investment appraisal), amortization, financial statement forecasting & modeling, Financial modelling cases among others…
What is financial model used for?
The output of a financial model is used for decision making and performing financial analysis, whether inside or outside of the company. Inside a company, executives will use financial models to make decisions about:
- Raising capital (debt and/or equity)
- Making acquisitions (businesses and/or assets)
- Growing the business organically (e.g., opening new stores, entering new markets, etc.)
- Selling or divesting assets and business units
- Budgeting and forecasting (planning for the years ahead)
- Capital allocation (priority of which projects to invest in)
- Valuing a business
- Financial statement analysis/ratio analysis
Course Contents:
Introduction to financial modeling and financial statements:- financial statements, steps to create Integrated Financial Model. Creating A Layout For Integrated Model Excel Shortcuts, Referencing Framework In Excel, Custom Formatting In Excel, Understanding Circular References in Excel
Time Value of Money in Excel and What if Analysis:-PV and FV of Annuity; (Single and Multiple Cash flow), Amortization; (Constant and general discount rate), Sensitivity analysis. What if Analysis; One & Two-way Data table, goal seek, scenario manager. Using solver for business and investment decision optimization.
Capital Budgeting:- Investment Appraisal techniques using the modern techniques of investment appraisal such as (NPV, IRR, PBP) with powerful sensitivity in Ms-Excel.
Business Modeling Basic Case:- Equated monthly installments Basic Case, Dissecting the Business Case, PL & BS Drivers, Building Assumptions, Projecting Financial Statements. Understanding Macros. Financial Statement Analysis. Credit Risk Model-1 and Credit Risk Model – II
Understanding the 3 Statement Financial Modelling
Free Cash Flows (to the Firm and Equity) – FCFF, FCFE, Calculating FCFF and FCFE, Understanding Cost of Equity – CAPM, Understanding Cost of Capital – WACC, The Income statement, Balance Sheet and cashflow linkage. Financial Statement Dashboard.
Financial Modelling Case Study: Road Tolling project modelling
Duration: Four (4) days Fee: N150,000
For Whom: Investment Bankers, financial officers, accountant, business analyst…