Useful glossary of key business and financial valuation terms as prescribed and used by the members of leading business valuation professional societies and organizations in the United States and Canada.
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Further Techniques for Auditing a Financial Model
Financial models are often used to make major financial decisions that involve several millions of dollars worth of capital. It is therefore essential that these financial models do not contain errors or bugs that render calculations and results incorrectly. A good financial analyst will always start a financial model audit assuming that every financial model [...]
Using Monte Carlo Simulation Analysis for Finance
The long held assumptions that risk assessment metrics and risk premiums don’t change much have been dramatically challenged. The rapid, global meltdown of financial markets and the real economy in 2008 and 2009 has shown that risk premiums can change quickly in both developed and emerging businesses and markets.
As a result, expected value and base [...]
Financial Management Excel Templates (All Inclusive 150 Workbook Pack)
We would like to introduce to Financial Modeling Guide readers a pack of 150 Excel workbook templates, Excel add-ins and Learning Modules which allows you to perform quick and easy Financial Management functions and analysis in Excel, including financial risk analysis, profit margin analysis, advanced cash flow and cash burn forecasting.
The Complete Excel Financial Templates [...]
Mechanics of Discounted Cash Flow Valuation – WACC
One of the most important aspects of financial theory in financial modeling and valuation is the weighted average cost of capital (WACC). The WACC is the discount rate, or time value of money, used to convert expected future cash flow into present value.
In practical terms, WACC represents what it would cost, on average, to raise [...]
