Practical Financial Modelling

Jonathan Swan
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Jonathan Swan: Operis TRG Limited, London, UK

in Elsevier Monographs from Elsevier, currently edited by Candice Janco

Abstract: Practical Financial Modelling, 3e is a book on model development and model assurance. It enhances the modelling process by emphasizing controls and checks for accuracy and reliability. New content on validation and verification, model use and sensitivity analysis is presented alongside a modelling methodology that underpins the various proprietary standards used in financial modelling today. It provides more details than other books and yet is general enough for applying its methodology to many applications. This book isn’t just about the details of building cash flow models, it’s about building better cash flow models. This new edition increases the number of worked examples and introduces new material on the audit sheet and audit workbook methodologies, and the delta sheet approach to sensitivity analysis. It provides the developer with a toolkit of modelling techniques and a framework of error controls to reduce the risk of spreadsheet error. The methodology and structure conforms with the modelling principles defined by the Institute of Chartered Accountants of England and Wales; and the model assurance processes ensure compliance with the UK public sector Macpherson Report and regulatory requirements such as Sarbanes-Oxley.

Keywords: Arithmetical audit check; Array formulas; Audit tools and techniques; Avoiding IF; Calculating dates; Change audit check; Charting techniques; CHOOSE; Circularities; Combo boxes; Conditional formatting; Corkscrews; Counters; Create names; Custom formatting; Data tables; Data validation; Debt sculpting; Define names; Delta sheets; Drop-down lists; Dynamic name ranges; Environmental audit check; Error handling; Financial audit check; Flags; Goal seek; Group and outline; Human error; INDEX and MATCH; INDEX; Inputs sheet; IRR and XIRR; Iteration; Late binding functions; Left-to-right consistency; Logical functions; Logical masks; LOOKUP; Macro buttons; Macros; Model audit; Model development; Model documentation; Model review; Modelling compliance officer; Modelling standards; Monte Carlo analysis; Multiple inputs sheets; Naming variables; Natural language formulas; Navigation; NPV and XNPV; Operis versus FAST structure; Outputs sheet; Printing and reporting; Project finance; Protection and passwords; Public-private Partnerships (PPP, P3)Quality assurance; Quality control; R1C1 referencing; Range names in functions; Range names; Recorded macros; Relative and absolute references; Risk analysis; Risk assessment and risk controls; Risk modelling; Scenario management; Senior responsible owner; Sensitivity analysis; Structural audit check; Switches; The audit sheet; The audit workbook; The Macpherson report; The model review plan; The model reviewer; The Name Manager; Time-constrained calculations; Timing issues; Top-down approach; User-defined functions; Visual Basic Editor; Visual Basic for Applications; What-if analysis; Workbook structure; Workings sheet; Written macros (search for similar items in EconPapers)
Date: 2015 Originally published 2015-08-24.
Edition: 3
ISBN: 978-0-08-100587-3
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