Features
Best practice
financial modelling
Financial forecasting consistent with the highest of professional standards
All our models are built in strict compliance with leading-edge financial modelling practices.
If you search online you’ll find various attempts that set out the features that are more likely to make Excel financial forecasts good (or, even better, great).
We’re fans of what the UK’s professional accountants’ body ICAEW has done in this area.
If you’re reviewing a piece of Excel work we’d recommend holding those efforts up to the light of the ICAEW’s financial modelling code to see how it does.
Best practices as dictated by the UK's professional accountants' body
You can download a copy of the ICAEW’s Financial Modelling Code we subscribe to here: ICAEW Code.
It’s around 20 pages and is written in plain English.
If you’re any kind of a fan of Excel spreadsheets, for a technical document, you should find it a worthwhile read.
20 principles and topic areas we stick to
Notice the list and range of topics contained in the Code.
Online here we’ve just focussed our attention on a few specifics, where often we find gains can be made in improving financial models:
- clearly separating assumptions – p5 of the Code, p17 and p21 principles #10 and #14;
- keeping calculations transparent and simple – p16 and p21 principles #12 and #13;
- paying attention to model design features that make work easier to update – p3 and p21 principle #8, p4 principle #10;
- getting the financial statements working together so that the impact of a stress test and balance sheet changes are fully reflected in cash flow;
- summarising the most important results in the dashboard at the top of the model – p21 principle #9.
We diligently follow great financial modelling practices with a view to giving people confidence that work is more robust
As outlined in the ICAEW code, there’s a lot more to building models than the few topic areas we’ve listed on our website here.
In pursuit of great results and financial forecasts that are less error-prone, we pay great attention to the complete list of financial modelling practices.