Key Components of a WSS Financial Model Financial Module • Income Statement • Cash Flow • Balance Sheet • Investment Program • Borrowing Summary
Computer-based model used to develop financial projections using historical data and assumptions • Financial Model of a Water Utility:
FINANCIAL STATEMENT MODELING JUSTIFYING GROWTH RATES AND MARGIN Instead of just assuming a 10 growth rate, base your assumptions on the following:
An adequate financial model is an essential tool for the financial Agree assumptions as regards how much of the initial cash shortfall will be
financial models and to help you understand the impact of different financial or commercial assumptions on the cash position, profit, tax and financing
Building a Financial Projection Model Step 1: Make forecasting assumptions (next class) Most Pro Forma Financial Statements models are sales driven
How confident are you that your existing models are error-free, robust and reliable? Are you able to flex modelling assumptions easily and assess the impact on
comprehensive, assumptions-driven financial model with extended sensitivity analysis Available instructional resources tend toward basic spreadsheet
I just happened to build you a template / detailed model (posted online) Building Financial Models Page 5 Defining Relevant Assumptions
Your assumption numbers entered into each assumptions worksheet page flow via links and formulas throughout the entire financial model financial statements