1. Course Description
Modeling techniques for accurate financial forecasting are used in many areas of finance, such as derivatives, valuation, project evaluation, deal structuring, portfolio management and the like. In the course, the participants will learn the model building skills required to build powerful models in finance with the help of excel. There are many features of model building that are common irrespective of the final model that one intends to build. In the course we will also emphasize on the different model building skills that one should have irrespective of the final use that one is going to make of it.
2. Student Learning Outcomes (typically 3-5 bullet points)
By the end of the course the participants should be better able to:
· Understand the basic and advanced features of excel · Understand how to build models in excel to suit one’s purpose · Building models in different areas of finance including investments and corporate finance · Identifying and controlling the key sensitivities with advanced spreadsheet simulation
3. Required Text Books and Reading Material
Mastering Financial Modeling by Alstar De. This is a Pearson Publication.
4. Tentative Session Plan
Model 1: Building a Simple Project Finance Model
Sessions 1 to 5:
· Building Project Finance Model for Smokey Valley o Do’s and Don’ts of Modeling o Doing Date Calculations o Managing Currency and Currency Units o Estimating NPV, IRR, etc. o Sensitivity analysis using Excel o Scenario Manager o Other sensitivity analysis features o Building an Executive Summary for the Model Model 2: Building a Simple Financial Statements Model
Sessions 6 to 8:
· Building a Financial Statements Model o Balancing the Model o Managing Circularity o Valuing the Entity Sessions 9 and 10: Automating Financial Models with the use of Macros
5. Evaluation
In the course, we will be building 2 models. The faculty will help you building almost 90% of the model in the class. The remaining 10% of the model will be left to you either as a quiz (to be submitted immediately after the class as an email) or as an assignment (to be submitted within 24 hours of the end of the class). In addition, there will also be an end term examination, where you will be required to build a model from scratch.
Your marks in the quiz or the assignment will be proportionately reduced for every class in which you are absent. Thus for example, if we take 3 sessions to build a model and you are absent on 2 of these 3 sessions, then you will get 1/3rd of the mark that you deserve in that component of evaluation (irrespective of the reason why you are absent from the class).
6. Academic Integrity
It is expected that you build all the models yourself without taking help from others. If you submit me an excel file which has been partly or completely built by somebody else, then you will get 0 in that particular component of evaluation.
Created By: Debasis Mohanty on 11/14/2012 at 09:38 AM Category: PGDM-II Doctype: Document