Financial Modeling Guide

A good financial analyst will use each column and row for only one type of information, and will always cluster numbers to be added in a financial modeling exercise.

Preserving each column and row for a specific type and value helps you in …

• Using named ranges – e.g. if a row is named “sales”, and columns I to L are months September to November, entering “=sales” in column J will refer to sales in October only in the financial model.
• Checking for errors – calculation formula in any one column or row should generally only refer to cells in the same column or row in the financial model.

… and it will help you avoid:

• Deleting or inserting columns that look blank but in fact contain information in another part of the spreadsheet of the financial model.
• Unintentionally overwriting information as you copy calculation formula across or down a spreadsheet in a financial model.
• Try to put numbers to be added up together instead of putting them in random selections of rows, for example,
  use    =sum(A27:A30)    rather than   =E352+E370+E406+E411

If you're new to Financial Modeling Guide, you may want to join our sister site, the Finance 3.0 network, to enroll in online financial training programs, ask questions, attend seminars, connect with others and download free finance spreadsheet templates about financial modeling, financial management, corporate finance & valuation, quantitative finance and accounting.
Over 50,000 finance professionals, entrepreneurs, analysts and investors from 195 countries have benefited.
Don't miss out on this outstanding opportunity for high quality, globally recognized financial education: Sign Up For Free Now!

After reading this article, people also reviewed these financial modeling and valuation resources: