SPECIALISTS IN FINANCIAL MODELLING

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.

So, when you have put in all the hard work, and you have finished your Excel model (I’m assuming here that you’re using Excel) make sure you allow enough time at the end to create the visuals and outputs. People will trust your numbers more if you spend some time making it look good and use formatting! Make sure that you all enough time at the end of the project to do this properly.

Other people, non-finance people, do not necessarily like Excel, (shocking, I know!) Yes, there are people out there who do not love Excel as much as we do. They freak out when they see gridlines! Part of your job as the modeller or the person putting together this fabulous piece of financial analysis is to present the data in a way that is useful and appealing so that they can quickly and easy interpret what your model is trying to tell them and make decisions based on it.

Here are a few tips with you on how to do this:

  1.  Excel is not a presentation tool – do not just dump a spreadsheet into PowerPoint.
  2.  Add visuals as well as numbers. Finance people are used to looking at numbers all day every day, but even we find visuals easier to interpret than tables of data.
  3.  Spend some time tidying up your charts; add good, descriptive labels that tease out the message that you are trying to get across. Do not expect that the numbers will speak for themselves. That is your job; to make it so that the meaning just leaps off the page at them.
  4.  Remove clutter, make it really clear, think about the data to ink ratio – unless it’s contributing to your message – get rid of it! Do you need those decimal places? Do you need an axis at all?
  5.  In a financial model, documentation of assumptions is particularly important – but it doesn’t go in your summary. Only the absolutely critical data goes in the summary.

So, I hope those couple of tips will help you to communicate the outputs and results of your financial model in a clearer and more meaningful way.

Sign up for our Intro to Dashboards in Modern Excel free online training workshop  coming up on 19th May, and if you found these tips useful, I’d love to see you there!