Cash flow forecasting/
Traffic modelling (revenue)
What do we mean by a ‘financial model’?
Bids and transactions
Financial modelling is a team effort
Cash flow forecasting (detailed)
Tax & accounting
A financial modelling ecosystem is a community of financial models in
conjunction with their defined flows of data and purposes interacting
as a system.
In bad examples, also known as a whole lot of messy spreadsheets.
What is a financial modelling ecosystem?
I924+SUM(J920:J922), IF(AND(Debt.Bond1.Term*P- (J$11-
Would you bet AUD 3 billion that this is correct?
Balancing functionality vs. complexity
Typical timeline of developments
Identify (upfront) all stakeholder requirements
Clearly define the ‘owner’ of each model
Accept that there is not one perfect solution – compromises required
Identify interfaces (data, users and outputs) between layers
Standardise methodology across all layers
Sufficient (but not excessive) flexibility for analysis
Be realistic about the lifetime of a model and be prepared to turn off
Include consistency checks between layers
Define and document information flows
Goal: Consistent and robust analysis across all aspects of a project for all stakeholders
Challenges in developing an ecosystem
Recommended timing for ‘clean-ups’
2013 2014 2015 2016 2017 2018 2019 2020
Agreement between government, engineers, developers
Evaluation of alternative funding cases
Alternative funding scenarios require input from a wide range of areas