Financial Modeling Best Practices Flashcards
What color should hard-coded numbers (inputs) be?
Blue
What color should formulas (calculations) be?
Black
What color should links to other worksheets be?
Green
What color should links to other files be?
Red
What color should links to data providers be?
Dark Red
How do you type a multiple in excel as a “8x” format?
Custom Formatting
How many decimal places are used to express per share data typically?
Two decimal places ($2.16)
How often should you hard-code data?
Only once
How do you evaluate individual sections of a formula on excel?
Highlight the part you want to evaluate then press F9
Should you name cells and cell ranges? Why? (3)
Avoid:
1. Harder to trace using F2
2. Deleting names creates errors in dependent cells
3. Names “linger” in sheets and create confusion (if you copy from one file to another it will create errors)
Should you link files? Why?
You should avoid - others may not have access to the linked files.
It might work initially but as soon as the person starts doing work on it, and excel tries to find the original data, errors may appear
How can you ensure there are no dependent worksheets (tabs) before deleting a worksheet?
Command F and then search the name of the worksheet you want to delete. Click Find All and see if it is referenced anywhere else.
What is an elevator drop?
An elevator drop is when you put a character in cells of column A, right beside major headings in column B, and then use Control + Down Arrow to jump quickly between secitons?
Why is it important to always leave column A blank?
To create elevator drops
How should assumptions be organized?
Clustered together, at the top of the model
