Are you wondering about financial modeling? Why is it so important? And where to study a financial modeling course content? Well, you’re at the right place to get answers to all these questions. In this article, we tried to cover the answers to all your doubts. So, let’s hop into it.
What is Financial Modeling?
Financial Modeling plays a vital role in running a successful business organization by helping to decide while merging and acquisitions, providing the needed knowledge for planning and managing a business, and also helping to make investment decisions and raising capital.
Financial Modeling Course content is highly demanded by every corporate business because the model can show mathematical proof that denotes the amount of risk in the decisions and assist to make profitable decisions that conclude the organization to run successfully.
Financial Modeling is about creating a model from scratch or maintaining the previous existing model by adding on the freshly collected data. It helps the individual to get deep knowledge and understanding of the current situation of an organization.
Financial Modeling Course content is about the main core element of the business to take major decisions in the corporate system. The financial model is the most needed tool and plays a vital role to execute the business decision to make a perfect solution for the company.
- Financial Modeling is the numerical presentation of all aspects of a company’s activity/
- Financial models are utilized to calculate the value of a business and to compare competitor companies.
- Several models exist that may produce varieties of results. Only a good model with relevant inputs and assumptions suits well.
Why Should Use Financial Modeling?
Financial Modeling helps to produce a detailed collection of data to understand the business and helps to improve the business performance, it is very important to perform the variance analysis. Preparation of periodic review gives the whole data of business activity from the past to present. Helps to make decisions in funding with required amounts and strategy. A business can understand the cash flow after the interest and repayment of loan expenses.
Minimize the risk and enhance business value. Financial models help to generate quick outputs since the business may take months to get answers to particular financial questions and also to determine the impact of certain decisions. Financial budgets can be accurately forecasted. The financial model helps a business to grow by analyzing the profitable areas and making decisions to develop them.
Who Uses Financial Modeling?
- Entrepreneurs and business owners
- Accounting and finance professionals
- Consultants and financial Modelers
- Personal Finance
Skills to Possess
These are the top most important skills to become the best financial analyst.
1. Accounting Skills
Building a financial model should require a good amount of knowledge in accounting skills. The concepts such as accrual, revenue recognition, depreciation, amortization, etc. You need to possess sufficient accounting skills to read financial statements, dissect, and how to build back up again.
2. Excel Skills
Excel mastery is a critical skill in financial modeling. Sometimes creating financial models is more like an art than science. You should know all the main keyboard shortcuts to save time to build models quickly.
3. Connecting the Three Financial Statements
This is a very important skill. The income statement, cash flow statement, and balance sheet are the 3 financial statements. Connecting all 3 can be the trickiest one to master, only practicing regularly will make you master.
4. Forecasting Skill
Good at forecasting is a combination of science and art. Regression analysis is used to predict future results by using the historical results as a base. Managing the team and culture must be taken into account.
5. Problem-solving Skill
An expert financial analyst should be able to think logically and should perform in an organized manner. While building a financial model, a financial analyst must work with the logical flow of information to avoid confusion among the other users and should be understood easily while they look into it.
6. Attention to Details
This is a critical skill to build financial modeling. With the huge amount of information and the very few corrections are only possible by paying attention to the details. Train yourself to develop attention to detail and practice daily to develop the habit.
7. Simplify Complex Information
Simplification of complex information is the best value for great financial modeling skills. Ability to filter a huge amount of complex information into a simple format.
8. Design Skill
FinancialModeling also demands to have a nature of design and aesthetics. Well-organized graphs and charts presenting the information beautifully are the skill that makes them look for more information without struggling to find it and getting bored of it soon.
9. Presentation Skill
A good financial analyst should be able to create PowerPoint presentations and pitch books to convey the result of the model to the higher authorities in the organization. The financial model should explain the story of your business and show the performance of your company today and prediction for the future.
10. High-level Strategy and Detail
To be a successful analyst, one should have this rare ability to zoom in at an extreme level on every individual detail and zoom out to a level of strategy. Most people are stronger in either of them, but even some people are rare at being good at both.
Types of Financial Models
- Discounted cash flow model
- Merger and acquisition model
- Initial public offering model
- Option pricing model
- Forecasting model
- Consolidation model
- Budget model
- Sum of the parts model
- Leveraged buyout model
- Three statement model
Financial Modeling Career
1. Financial Projection for Startups
Every businessman owns a startup and he has to create a startup financial model to understand his/her firm’s future performance. Cash flow valuation will be the major role and the founder of the company should take charge of the finance team. The financial projections template will also help you to calculate payroll costs, expenses for startups, cash flow, balance sheets, etc.
2. Real Estate Financial Modeling
Creating detailed financial models is the job of real estate developers which will determine how much to invest and how much to invest in real estate. You should understand the real estate statement models for both junior and senior real estate developers, this is a very important duty as a financial Modeler to prevent loss.
3. Corporate Development
Your more well-known investment bankers’ counterparts are corporate development groups. All corporate developers should be more efficient to make financial developments. Your performance should be at a higher level if you’re planning to get into this job.
4. Equity Research
Equity researchers need to build a report which they should send to the clients on what they are going to invest in, but the investment decision will be taken by the clients. Those reports include financial models.
This is the career where spreadsheet models are used. Investment bankers always use financial models which are assembled in excel to evaluate the company to decide on mergers and acquisitions or capital raising.
Uses of Financial Modeling?
- Forecast future raw material needs
- Evaluate the security
- Benefits of a merger
- Check the size of the market
- Visualize the profitability
- Check the required investment
- Predict the amount of risk
- Portfolio of performance
- Identity the undervalue securities
- Analyze the cash flow and discover the way to improve
- Determine the present required budget
- Understand profitable products
Most Used Financial Modeling Techniques
These are the techniques that you can use in most financial situations, in the case you’re dealing with business models. These are the common ways to approach a problem.
Utilize this technique when the company is trying to buy another company, this is the situation to calculate the fund to complete the transaction by their name and capacity. The financial model helps to determine the amount of profit that will be generated in the future by the company. This is one of the most complicated financial models, commonly used in private equity firms and investments.
2. Initial Public Offering Model
This model is mostly used by the investment banker or a developer. It helps to find how valuable before the business goes to the public. With the help of this model, you can compare the companies and decide the right amount of pay for a share to the investor before it starts selling the said shares.
3. Consolidation Model
This model adds several business units to the large model. Every individual unit comes with its data that must be combined to build a large worksheet using all the data. In case you want to make financial projections, for example: build a financial consolidation model for Tech Inc. it inspects all the data from all the units such as Apple, Samsung, Nokia, Asus, etc.
4. Forecast Model
If you want to work in financing activities, you should know how to use the financial model and budget model, you also need to combine them to understand how the company performs financially.
5. Budget Model
You should be using a budget model to plan a budget for the upcoming year. This model is often used monthly or quarterly. Their focus is on the income statement by the company.
Check out the best Financial Modeling Courses in India
Financial Modeling jobs
There are various jobs after completing the Financial Modeling Course content from a reputed institute. There is a huge demand for finance professionals and the jobs are:
- Business analyst
- Market research analyst
- Financial manager
- Associate analyst
- Financial analyst
- Equity analyst
Advantages of Financial Modeling
- A better understanding of the business
- Helps to decide on funding strategy
- Helps to reach the correct valuation
Disadvantages of Financial Modeling
- Soft factors not considered
Top 10 Best Financial Modeling Courses:
1. IIM SKILLS
The financial Modeling Course by IIM SKILLS is an excellent training program. The curriculum was selected by business experts who have extensive knowledge in the finance industry. This comprehensive courseware was created after significant investigation and consideration. This program is specially tailored to help learners find market-level positions while maintaining the standards of the finance industry, granting it the reputation of becoming the best financial course content in India.
This Financial Modeling Course Content Provides,
- 3 months live online Financial Modeling and valuation course
- 50+ hours of lectures
- 100+ hours of practical assignments
- 5+ case studied
- 2 months guaranteed internship
- Mock interview preparation
- 100% job support
- 100% practical course
- Lifetime access
- 100% Money back guarantee after the 1st session, if you do not like our course.
2. Corporate Finance Institute (CFI)
More than 170 different nations’ professionals and students are served by CFI. This institute is the foremost choice of many aspiring learners for financial modeling course content.
- 6 months course completion period
- 100% online learning
- Learn at your own pace
- 2 years of free access to the online library of CFI
- Average Package $121,000
- More than 120 downloadable templates
- Recognized certificate
3. Udemy: Beginner to Pro in Excel, Financial Modeling
The financial modeling course content is extremely well-written and presented in a practically approachable manner. It is jam-packed with tests, exercises, clear demonstrations, and case studies based on actual events. Professional chart examples, including those used by large banks and consulting firms, are included in the up-to-date information.
- 13 hours of demand video
- 9 articles
- 569 downloadable resources
- Full lifetime access
- Access on mobile and TV
- Certificate of completion
Recommended Read: Online Financial Modeling Courses
Coursera is a well-known self-paced learning portal with a huge selection of courses and programs. Coursera is a company that is constantly expanding to make the globe a place where everyone can learn from anywhere and change their life. They have already teamed up with more than 200 colleges to broaden their scope in every area to realize this objective.
- Shareable certificate
- 100% online courses
- Flexible schedule
- Beginner level
- Approximately 6 months to complete
5. The WallStreet School
This is one of the leading educational institutes in finance and is also trusted by top investment banks in the world for its financial modeling course content. They led their online class and boot camps with experienced instructors to the corporate people. Wall Street has 200 plus corporate clients, more than 125 university clients, and 3,00,000 above learners.
- 6 weeks course | 180+ hours | Mon-Fri, 9am-3pm
- 2 ½ months course | 120 hours | sat-sun, 9am-2:30pm
6. Grant Thornton L&D Academy
Thornton L&D Academy is well crafted for working professionals & students to get practical exposure to Financial Modeling and valuation, it helps to understand and build business and valuation models. This course is built to ensure conceptual knowledge and industrial practice. It also involves case studies to educate the concept that helps the learners to understand the real-time experience of their job roles.
- 5-day classroom training
- Study material
- Access to Grant Thornton LMS
- Certificate of completion
- 50% fee refund if the course cancellation is done in 5 days
Their financial modeling course content is designed to provide practical exposure to learners who trust the concept of long-term investment and value creation. Building a financial model statement and investments is more like a science. This course is to develop the understanding of the essence of the subject and to utilize the knowledge in the real world. This course offers intensive instruction and training to students to compete successfully in rapidly updating global financial markets.
- 59 videos
- 10+ hours of content
- 30+ supplementary study materials
- Full-length test
Recommended Read: Online GST Certification Courses
Financial Modeling Course content by EduPristine provides case studies and analytical tools with standard philosophy of teaching through a variety of practical real-world situations. After completion of the course, you’ll be able to construct a model that represents financial statements and assess a business from a variety of angles.
- 14 days 70 hours of classroom training
- Comprehensive study notes
- Post-session practice on real-life case studies
- 24/7 learning management system access for 1-year validity
- Customized training solutions
- Case-based training
Finladder is a start-up by two students who are pursuing a bachelor of commerce from Shaheed Bhagat Singh College, a Delhi University. Finladder’s main motive is to educate finance literacy in India and abroad. They have excellent financial modeling course content.
- 2 months duration
- Lifetime access
- Internship with 2 live projects after the course
- Improved resume
- The course helps in own investment analysis
10. Henry Harvin
Financial Modeling Course content from Henry Harvin is provided by professionals through a practical-oriented learning system. The vision of this institute is to impart the skill to industry experts from different fields. The curriculum of these courses provided by Henry Harvin is sculpted and positioned by the present requirements of the industry.
- 40 hours course duration
- 24 hours interactive online sessions
- Practical training with hands-on projects
- Internship assistance
- Free placement assistant for 1 year after completing the course
- Regular boot camps for 1 year
- E-access to numerous tools, assignments video material, and techniques for your employability
Some institutes provide financial modeling course certifications but the candidate must complete the 10th, and some other institutes offer certification in Financial Modeling after class 12th completion. So, there is no specific eligibility to pursue a Financial Modeling course.
The basic eligibility to pursue a Financial Modeling Course content is knowledge about the required skill set and finance. Aspirants with a CA or MBA degree can easily cope with the course and easily become financial Modelers since they have the basic knowledge and strong foundation in finance.
Q1. What are top financial certifications?
These are the most known certifications,
- Chartered mutual fund Counselor (CMFC)
- Chartered life underwriter (CLU)
- Chartered investment counselor (CIC)
- Chartered financial consultant (CHFC)
- Certified public accountant (CPA)
- A certified financial planner (CFP)
- Chartered financial analyst (CFA)
- Financial risk manager (FRM)
- Chartered alternative investment analyst (CAIA)
- Certified management accountant (CMA)
Q2. What is the eligibility for financial modeling?
Anyone can build their career as a financial model, there are no borders or pre-qualification. You can hold any degree qualification but you should work smart and hard because this is more like an art that takes time and effort to make perfect.
Q3. How easy is it to become a financial Modeler?
With a basic knowledge of finance and excel skills, anyone can become a financial model. You should be developing more complex models later.
Q4. What is the minimum salary for a financial Modeler?
The expected minimum salary amount for a financial Modeler in India is Rs 5,25,983 per annum
Q5. Is Financial Modeling an important course?
Yes, this is the most needed skill. If you want to build a career in the finance industry, the Financial Modeling certification will be an added advantage and more likely to get hired by the company.
Q6. What is financial modeling?
Financial Modeling is the hybrid collection of data that consists of both backward and forward-looking statements.
I hope we covered all the topics and the top best Financial Modeling course content-producing institutes in India in this article. We tried to add all the details as much as possible to display a piece of collective information that could help to conclude.