#BALANCE FORECASTING SPREADSHEET DRIVERS#

In these cases, the line items need to be separated and forecasting approaches should be tailored to the nature of the items.

#BALANCE FORECASTING SPREADSHEET DRIVERS#

For example, companies may lump line items with different drivers together. Data is organized in columns ascending from left to right.Ĭompanies present their balance sheet in ways that are not always optimized for analysis. It is recommended that at least two years of historical results are inputted into the model to help provide some context to forecasts. Before we dive into individual line items, here are some balance sheet best practices (click here for a complete guide to financial modeling best practices): Typically, the main balance sheet section of a model will either have its own dedicated worksheet or it will be part of a larger worksheet containing other financial statements and schedules. Learn More → Investment Banking Primer Setting up the balance sheet forecasts Now it’s time to turn to the balance sheet. Imagine that we are tasked with building a 3-statement statement model for Apple.īased on analyst research and management guidance, we have completed the company’s income statement projections, including revenues, operating expenses, interest expense and taxes – all the way down to the company’s net income. Sensitivity Analysis (“What if” Analysis)

Balance forecasting spreadsheet