Dynamic Arrays in Microsoft 365 Excel have fundamentally changed the way we use Excel for financial modelling. A single cell formula may return several values and they all spill across and/or down the grid. Financial modellers can benefit by using dynamic arrays to offer more business insights with fewer formulae than ever before. (more…)
There’s nothing quite like experience to really hone and sharpen your Excel modelling skills. Every hour that you spend nutting through a problem on the job means that the next time you come across a similar problem, you’ll solve it in a matter of minutes, not hours. This is especially true for creating complicated Excel formulas, or for model design and layout. So often I come across a problem when building a modelling solution for a client and I know I’ve seen this problem before. Whilst it might have taken me half an hour to model it out the first time, often using trial and error but the next time it’ll only take a few minutes. The more experience you’ve got, the quicker and better modeller you’ll be.
Traditional management accounting has always had its challenges and the COVID pandemic has made its shortfalls even more apparent. We find ourselves with forecasts and budgets that were not realistic, and we have learnt that organisations must be agile to survive.
Professionals working in a finance team might build beautiful reports or financial models which we are enormously proud of, as we have usually put a huge amount of work into. These models are not helpful, however, if other people are not able to actually use or understand them and their messages and use them to make decisions. One of the things – and often the missing piece – for financial modellers is having the skills to present the output of the model in a way that is useful and easy for others to interpret.
Recently our friends at Full Stack Modeller conducted the biggest ever survey of the financial modelling profession, and the results were published in February 2021. What are financial modeller’s biggest frustrations? How much do modellers earn? What add-ins and tools beyond Excel do modellers use? Covering tools, standards, risk management and more, the 2021 survey paints a picture of the current state of play in financial modelling.
We used to be able to simply look at last year’s actuals, apply growth trends and the seasonality to build budgets and forecast going forward but we just can’t do that anymore! It’s never been more important to have the skills to be able to build robust, flexible and dynamic budget models to accurately predict budgets and forecasts for future periods.
I am very much looking forward to my new LIVE and ONLINE sessions on one of my favourite topics – budgeting and forecasting! During the many years I’ve been working as a finance & analytical consultant, I’ve built, overseen, implemented and reported against scores of budgets and forecasts across a multitude of industries, but forecasting has never been as much of a challenge as it is at the moment.
Personally, I’ve never been particularly interested in entering any of the financial modelling championship competitions – I suppose I never felt the need to prove anything and it all seemed rather high-stress and hyper-competitive, with the questions being released at all hours of the night. When the new Financial Modeling World Cup launched last month with a small entry fee and a two-hour commitment, I entered more out of curiosity than anything and found it actually quite stimulating and challenging. Being my first attempt and not taking it seriously (admittedly taking a phone call and then making myself tea and toast during the allotted time probably wasn’t wise). I completely bombed, and was rather relieved to see the names are not shown publicly for those who do poorly. Despite my pitiful results, I did find the challenge quite addictive and I took it far more seriously in the second round. I actually made it onto to the leader board at #34, although I am not sure if this rank takes into account my first attempt. I do hope so, as it means I’ll have a better chance at improving!
Happy Halloween! I have been meaning to write about phantom links for a while, and Halloween is a good time to talk about hunting down and exorcise this ghoulishly annoying phenomenon from your financial models.