CONSULTING TOOLKIT     Narrowing to a Recommendation     Calculating Financial Impact© 2007-2012 IESIES Development Ltd. A...
Present financials in a pyramid structurePRESENTING FINANCIALS - STRUCTURE   •The Answer first: Summary financials (e.g. P...
Present financials in a pyramid structurePRESENTING FINANCIALS - STRUCTURE                    Summary Financials  Key Assu...
Good charts will bring your financials to lifePRESENTING FINANCIALS - CHARTS   •Put the most important numbers in the lead...
In delivery, show you are on top of your numbersPRESENTING FINANCIALS – DELIVERY AND Q&A PRESENTATION • Demonstrate your m...
You will need to be fluent with financial terminologyCLASS EXERCISEA business is looking at investing in a new project. Th...
There are 4 key financial numbers you should focus on      CUMULATIVE CASHFLOW      HK$m                                  ...
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Consulting toolkit calculating financial impact

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Consulting toolkit calculating financial impact

  1. 1. CONSULTING TOOLKIT Narrowing to a Recommendation Calculating Financial Impact© 2007-2012 IESIES Development Ltd. All Ltd. Reserved © 2007-2012 Development Rights All Rights Reserved
  2. 2. Present financials in a pyramid structurePRESENTING FINANCIALS - STRUCTURE •The Answer first: Summary financials (e.g. Projected cashflows/P&L) •Key assumptions, with rationale •Key drivers of these financials (sensitivities) •Downside risks and upside opportunities •Financing if a new business venture © 2007-2012 IES Development Ltd. All Rights Reserved
  3. 3. Present financials in a pyramid structurePRESENTING FINANCIALS - STRUCTURE Summary Financials Key Assumptions Sensitivities/Drivers Upside/Downside risks © 2007-2012 IES Development Ltd. All Rights Reserved
  4. 4. Good charts will bring your financials to lifePRESENTING FINANCIALS - CHARTS •Put the most important numbers in the lead/message •Make sure the numbers in your lead are highlighted on the chart •Use graphs to visualise the numbers •Only use tables if the numbers are too complicated and NEVER present a spreadsheet! •80/20 rule – don’t try to be comprehensive Details: •Make sure every axis and number has labels •Sensible rounding, no spurious accuracy (e.g. $456.38m) •Use acronyms correctly (e.g. ROCE%, IRR%, NPV) •Check numbers are2007-2012 IES Developmentacross Reserved © consistent Ltd. All Rights pages
  5. 5. In delivery, show you are on top of your numbersPRESENTING FINANCIALS – DELIVERY AND Q&A PRESENTATION • Demonstrate your mastery • Tell the business story when you explain the numbers • Bring numbers to life, don’t just read from the slide Q&A • Know your critical assumptions you must defend at all costs, and which can be flexible • One person should be the “numbers person” for Q&A, who knows the numbers cold • Full detail in hyperlinked IES Development Ltd. All Rights Reserved © 2007-2012 backup for fast access
  6. 6. You will need to be fluent with financial terminologyCLASS EXERCISEA business is looking at investing in a new project. They estimate theafter-tax cashflows as the following: Year 0 -$50m Year 1 +$11.0m Year 2 +$24.2m Year 3 +$53mCalculate 1) NPV($m) (WACC=10%) 2) ROI% 3) IRR% 4) Cash payback (months) © 2007-2012 IES Development Ltd. All Rights Reserved
  7. 7. There are 4 key financial numbers you should focus on CUMULATIVE CASHFLOW HK$m IRR% 40 NPV 30 4) TIME to payback cash 20 10 3) BURN 0 RATE Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q3 Q4 -10 2) FUNDING -20 NEED -30 1) TIME to -40 cashflow breakevenYYDDMM Syndicate Case_name © 2007-2012 IES Development Ltd. All Rights Reserved 6

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