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What are the five golden principles of financial modeling?

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تم إضافة السؤال من قبل Fahad Paracha , Deputy General Manager (DGM) Finance , Greenstar Social Marketing
تاريخ النشر: 2014/05/21
Ali Zayad
من قبل Ali Zayad , Financial Services Advisory , Ernst & Young

1. Attention to detail – it’s usually the little assumptions or minor mistakes that can throw everything off

2. Understanding the business – knowing the business drivers and key cost ingredients

3. Knowledge of how changes in the environment will affect the business – this helps in sensitivity analysis as well as forecasting

4. Knowing the accounting practices of the target region (i.e IFRS or GAAP)

5. Avoid analysis paralysis – keep the materiality concept in mind

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