Financial Modelling in MS Excel

Explore the time value of money through compounding and discounting, deriving present value and future value calculations to compare cash flows under different rates and periods.

Discount future cash flows to their present value using a given discount rate, then subtract the initial investment to obtain net present value, or NPV. Accept projects with positive NPV.

Learn how net present value compares a project's cash flows to a 10 percent alternative, showing an 11,908 gain, and how higher rates can make NPV negative.

Determine the internal rate of return (IRR) by finding where NPV equals zero, using trial-and-error with two close discount rates and a simple formula.

Learn to build flexible, reusable financial models in Excel with consistent columns, built-in checks, and scenario-based forecasts from historical data for 2020–2022.

Learn to forecast revenue and cost of sales in Excel by building a forecast financial statement, using best, most likely, and worst-case scenarios with the choose function.

Explore forecasting cost of sales by separating fixed and variable costs, applying best-case and worst-case scenarios, and using Excel functions to model revenue and costs.

Structure the profit and loss statement by tying administrative, distribution, and selling expenses to revenue, using historical data and best, most likely, and worst scenario assumptions.

Learn to complete a profit and loss statement in Excel by forecasting revenue, depreciation and amortization, taxes, and interest across best, most likely, and worst cases.

Learn the structure of the balance sheet, including non-current and current assets and equity and liabilities. Forecast a balance sheet and use a check column to ensure both sides balance.

Forecast the balance sheet by modeling working capital components—receivables, inventory, and payables—with days and revenue-based assumptions, then prepare the final balance sheet and cash flow implications.

Learn how to prepare an IFRS-based cash flow statement from income statements and balance sheets, classifying operating, investing, and financing activities and reconciling accrual with cash.

Construct a cash flow statement from profit before tax, add back depreciation and interest, and adjust for working capital changes to reveal cash from operating activities.

Explore how to reconcile opening and closing equity with profit and dividends, construct the cash flow statement across operating, investing, and financing activities, and forecast future cash flows.

Prepare and complete the cash flow statement by copying numbers and fixing references, applying a dividend policy to project cash. Link cash flow to the balance sheet and test scenarios.

Explore cash flow based valuation by forecasting future cash flows, discounting with the weighted average cost of capital, and valuing perpetual cash flows with growth to derive enterprise value.

Learn to evaluate capital budgeting projects using investment appraisal, calculating NPV and IRR through discounted cash flows, and determine the weighted average cost of capital.

Explore how to compute cost of equity using CAPM, incorporating the risk-free rate, market risk premium, and beta, while distinguishing systematic and unsystematic risks and the impact of capital structure.

Compute cost of equity using CAPM, adjust beta values for unlisted firms and country risk, and set hurdle rates with debt-equity considerations and risk premiums.

Explore geared and ungeared betas to separate business risk from financial risk, using benchmarks to adjust beta for debt-to-equity changes and recalculate cost of equity.

Learn to build a DCF financial model with unlevered and levered free cash flow, forecast 10 years, assess terminal value, and incorporate scenario-based selling prices, costs, inflation, and working capital.

Create a fixed asset schedule in excel by linking assumption inputs, allocate capex to year zero and year one, and calculate depreciation with residual value for tax benefits.

Explore how depreciation and interest create tax benefits that affect cash flows, with practical examples showing two methods to present tax benefits in financial modelling.

Learn to build a condensed dcf in excel by projecting operating cash flows from revenue, costs, depreciation, capex, and working capital, then calculate net cash flow and residual value.

Learn to validate operational assumptions by breaking down fixed costs, separating depreciation from production costs, and building a realistic manning plan for 24/7 operations, with questions that reveal hidden details.

Learn levered vs unlevered cash flow in dcf modeling and how wacc, tax shields, and project-specific beta determine cost of capital using capm for equity and gearing concepts.

Calculate project beta, cost of equity, and WACC in an Excel model, integrating debt and equity, post-tax debt cost, CAPM, and discount factors.

Master the final output of a DCF model in Excel by calculating present value, operating cash flow, capex, and working capital, then assess NPV through sensitivity analysis.

Explore how net present value and internal rate of return assess a project's wealth impact against the discount rate, with a 15% IRR and hurdle rate concepts.

Conduct sensitivity analysis to see how NPV changes with selling price, volume, and costs. Use present value and discount factors to assess feasibility and the impact of initial investment.