Tag: ExcelExcel Spreadsheet Examples, Financial model templates, and Excel Spreadsheets in Excel for various industry-specific businesses and use cases.
This is a collection of financial model templates for businesses in the Information technology Industry and its related sectors.
Excel Financial Modeling
Financial modeling is an arduous task which combines knowledge in Accounting, Finance, and Business to create a financial report. It is a highly valued skill which can be useful not only for personal use cases but also for business. The report or also known as a financial model serves as an abstract representation of an entity which requires a lot of calculations and specific set of assumptions. The process can be very complex, thus, financial modeling needs a tool which can better represent all the needed components in a structured way. The best tool that is commonly used among financial modelers - Excel.
Excel Financial Modeling became the norm when creating a model due to Excel's flexibility which allows the users to customize the model however they wanted to tailor it. There are also countless features which are very useful when creating Excel spreadsheets such as formula functions, charts & graphs, formatting, checking, and many more. Of course, it is substantial for one to have the necessary skills to use Excel to fully utilize the benefits when creating Excel spreadsheets such as:
- Basic formula functions such as SUM, ADD, AVERAGE, etc.
- Array Formulas to perform multiple calculations on several items in an array
- Reference Functions such as INDEX and MATCH or VLOOKUP to easily look up values or variables in more than one field
- IF, AND, OR Functions to create a more complex and dynamic model by adding in logic-based formulas which are usually used for running simulations after applying different assumptions
- Charts & Graphs to create a visual presentation of the resulting values in a chart or graph form which helps with drawing an analysis easier and faster
- Data Formatting to further optimize the model into a more professional-looking report and a more functional model which is user-friendly and easy to read
- Keyboard Shortcuts to be more efficient when creating a model
There are many more features that one can benefit out of Excel, hence, it is no question why financial modelers prefer Excel financial modeling.
Using Financial Model Templates – Excel Spreadsheet Examples
Excel financial modeling has a wide range of uses, but all in all, it has one goal – to ensure that the entities involved will make better economic decisions which will potentially lead to financial success. Thus, it is clear to see how beneficial it is to create excel spreadsheets for an entity.
Creating Excel Spreadsheets is indeed important, but the question is, how to even build one? It is, after all, a skill-driven task which requires specific know-how in finance, accounting, business management, and a substantial experience under their belt, to completely build a working financial model. Usually, hiring an expert in financial modeling or an analyst is the norm but, this option tends to be too expensive and quite heavy for those small-time users. Of course, there is also the option of creating a model on your own. You won’t have to pay extravagant fees and you will also learn how to build a financial model from scratch. The only downside for the second option is, it takes a long time to even complete one. Plus, there might be certain parts that are not reliable due to the lack of industry know-how which can be detrimental to the whole purpose of the model.
There’s nothing to worry though, for there is another option which is best suited for those against the first two options, using financial model templates. Nowadays, there are countless tools which help to create a model more efficient and one of the tools is a financial model template. It is a ready-made financial model that serves as a template to be completed by a user and further customized according to their preference. With a template on hand, you’ll be able to enjoy the convenience of finishing a model without having to spend too much money and time.
If you are interested in trying out to build a model out of a template, you can check out above, our list of Excel spreadsheet examples made by various financial modelers with extensive experience and industry know-how. The Excel spreadsheet examples can be used for cases such as:
- Business Plan
- Financial Forecasting
- Startup Financial Plan
- Cash Flow Projection
- Financial Analysis
- Break-Even Analysis
- Debt Repayment Schedule
- Financial Feasibility
The Excel spreadsheet examples listed are industry-specific and varies according to their use case, thus, you can choose according to what will fit your preference.
Steps for Building a Financial Model
After choosing a template from the list of Excel spreadsheet examples, you can now start building your very own financial model. The following are the most basic steps on how to build a financial model:
- Historical Data – in your model template, input at least 3 years of previous financial data of the business (depends on how long the model you chose)
- Ratios & Metrics – you need to calculate the historical ratios and metrics of the business which are used to evaluate and measure the ability of a business to generate income
- Assumptions – list down assumptions to create projected values of a business into the future, these assumptions are usually certain cases or scenarios which will affect the business positively or negatively
- Forecast – forecast the financial statements (income statement, balance sheet, and cash flow statement) by reversing all calculations based on the assumptions
- Analysis – after you finish determining the projected values, you can then proceed with conducting an analysis based on the resulting figures after forecasting
You can further fine-tune the model accordingly to further suit your requirements and to reach the objective of your model. If you still need help after using the template, don’t hesitate to contact us and we would gladly help you as soon as we can.