Introduction to Financial Modeling
4.5 (1,436 ratings)
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Introduction to Financial Modeling

Learn to build a simple integrated financial statement model.
4.5 (1,436 ratings)
Instead of using a simple lifetime average, Udemy calculates a course's star rating by considering a number of different factors such as the number of ratings, the age of ratings, and the likelihood of fraudulent ratings.
28,750 students enrolled
Created by Peter Lynch
Last updated 10/2014
English
Price: Free
Includes:
  • 1.5 hours on-demand video
  • Full lifetime access
  • Access on mobile and TV
  • Certificate of Completion
What Will I Learn?
  • Learn to build a simple financial model.
  • Understand how the three primary financial statements relate to each other.
View Curriculum
Requirements
  • Familiarity with excel
Description

This course will teach you how to use two years of historical income statement data and two years of historical balance sheet data to build a fully integrated financial statement model. It is designed for those new to financial models.

Section 1 will introduce the accounting equation and the three primary financial statements in the context of building a financial model. The content starts with the accounting equation, which is the single most important concept in accounting. The remaining three videos introduce the financial statements one at a time with a focus on the relationships that are important as you build financial models.

All of the material is provided via video-driven instruction with notes in pdf format to help follow along.

Section 2 will walk through integrating the three primary financial statements and creating a five-year projection. The first video provides a quick overview of the process. It is an easier process to grasp if thought of as a series of steps. It will also make it easier to measure progress as you work through the longer video. The video in Lecture 2 will walk you through the process of building the model cell by cell.

Because you are walking through the entire process of building a model, the video in Lecture 2 runs long: 35 minutes total. My advice would be to download the excel template attached to this lecture and build the model as the video progresses. Building the model yourself is the best way to fully understand the process.

In my opinion, if you want to build a strong financial modeling skill set, a thorough understanding of how an integrated financial statement model works is one of the most important things you can learn.

The last video in this section will explain circular references and how to fix broken models. It can be incredibly frustrating to finish a model and realize that it does not "balance." This video will help avoid that frustration.

I hope the content is useful to you! Please feel free to email me (peter@ASimpleModel.com) with any feedback.

Note: The longer video has some white noise in the background that I am having edited out. I hope to have a cleaner audio file up soon. Thanks for your patience!

Who is the target audience?
  • Students
  • Investment banking analysts
  • Entrepreneurs
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Curriculum For This Course
8 Lectures
01:17:48
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Introduction
1 Lecture 02:31

This video will explain how best to use the content that follows. I do not have an introductory video specific to Udemy, but thought this would be a helpful introduction to the material nonetheless.

Introductory Video
02:31
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Introduction to Financial Statements (For Financial Models)
4 Lectures 30:57

The accounting equation is the single most important concept in accounting, and it is instrumental in developing a more thorough understanding of financial statements. This video explains how the accounting equation is relevant in building financial models.

Please select the HD setting for the video player.

The Accounting Equation
07:59

This video introduces the balance sheet. The video walks through definitions, and concludes by highlighting relationships between the balance sheet and other financial statements that are important to keep in mind as you build financial models.

Please select the HD setting for the video player.

Balance Sheet
07:59

This video introduces the income statement. The video walks through definitions, and concludes by highlighting relationships between the income statement and other financial statements that are important to keep in mind as you build financial models.

Please select the HD setting for the video player.

Income Statement
08:32

This video introduces the cash flow statement. The video walks through definitions, and concludes by highlighting relationships between the cash flow statement and other financial statements that are important to keep in mind as you build financial models. This video places greater significance on how the three financial statements relate to one another in a financial model.

Please select the HD setting for the video player.

Cash Flow Statement
06:27
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Building an Integrated Financial Statement Model
3 Lectures 44:20

This video runs slightly longer than 4 minutes and briefly describes the process of building an integrated financial statement model. It is an easier process to grasp if thought of as a series of steps. Knowing the steps will also provide the benefit of measuring your progress as you watch the longer instructional video and build your own model. All videos are recorded in HD - switch to 720p by clicking on the HD button in the lower right-hand corner of the player.

Overview of the Process
04:29

This is the first instructional video in the “Integrating Financial Statements” series. The video will guide you through the process of using two years of historical income statement data and balance sheet data to build a fully integrated model. In my opinion this is the most important thing to understand if you want to build a strong model building skill-set. All videos are recorded in HD - switch to 720p by clicking on the HD button in the lower right-hand corner of the player.

Building the Model
35:04

Circular references are frequently responsible for crashing financial models. This video will explain how they work, and how to fix your model by focusing on the most common circular reference error found in financial models: the interest expense circularity. All videos are recorded in HD - switch to 720p by clicking on the HD button in the lower right-hand corner of the player.

Broken Models & Circular References
04:47
About the Instructor
Peter Lynch
4.5 Average rating
1,820 Reviews
30,319 Students
2 Courses
VP in Private Equity

Vice President at a private equity firm. Previously worked for Rabobank International's Mergers & Acquisitions group in New York, and for JPMorgan in South America.

Peter received his B.A. in economics from the University of Pennsylvania.

On a less formal note: I have been building financial models for the last 8 years, and about a year ago I decided to launch a website dedicated to teaching the subject. I love feedback so please feel free to contact me with any suggestions.