Textbook:Using Excel for business and financial modelling : a practical guide, 3rd Edition
Author(s): Fairhurst

Description:
This coursebook was written from course materials compiled over many years of training in analytical courses in Australia and globally— most frequently courses such as Financial Modelling in Excel, Data Analysis & Reporting in Excel, and Budgeting & Forecasting in Excel, both as face-to-face workshops and online courses. The common theme is the use of Microsoft Excel, and I' ve refined the content to suit the hundreds of participants and their questions over the years. This content has been honed and refined by the many participants in these courses, who are my intended readers. This book is aimed at you, the many people who seek financial analysis training (either by attending a seminar or self-paced by reading this book), because you are seeking to improve your skills to perform better in your current role, or to get a new and better job. When I started financial modelling in the early 1990s, it was not called financial modelling— it was just "using Excel for business analysis", which is what I called the first two editions of this book.
The title was edited in the third edition to "Using Excel for Business and Financial Modelling". It was only just after the new millennium that the term financial mod-elling gained popularity in its own right and became a required skill often listed on analytical job descriptions. This book spends quite a bit of time in Chapter 1
defining the meaning of a financial model, as it's often thought to be something that is far more complicated than it actually is. Many analysts and financial pro-
fessionals I' ve met are building financial models already without realising it, but they do themselves a disservice by not calling their models, "models"!
This coursebook has 12 chapters, which can be grouped intothree sections. Whilst they do follow on from each other with the most basic concepts at the beginning, feel free to jump directly to any of the chapters. The first section—Chapters 1 to 3—addressestheleasttechnical topicsabout financial modelling ingeneral, such as tool selection, model design, and best practice.
The second section—Chapters 4 to 8—is extremely practical and hands on. Here I have outlined all of the tools, techniques, and functions in Excel that are commonly used in financial modelling. Of course, it does not cover everything Excel can do, but itcovers the“must know” tools.
The third section—Chapters 9 to 12—is the most important in my view. This covers the use of Excel in financial modelling and analysis. This is really where the book differs from other “how to” Excel books. Chapter 9 covers some commonly used techniques in modelling, such as escalation, tiering tables, and depreciation—how to actually use Excel tools for something useful! Chapter 11 covers the several different methods of performing scenarios and sensitivity analysis (basically the whole point of financial modelling to my mind). Lastly, Chapter 12 covers the often-neglected task of presenting model output. Many modellers spend days or weeks on the calculations and functionality, but fail to spend just a few minutes or hours on charts, formatting, and layout at the end of the process, even though this is what the user will see, interact with, and eventually use to judge the usefulness of the model.