Model structure 2: Worksheet level
Each column should have a purpose. That purpose should be the same across the workbook.
Kenny Whitelaw-Jones
Model structure 1: Workbook level
When we're reading a book, the order that the chapters appear makes a difference. It's the same with models.
Understand the building blocks and you understand the model
Well built models should be made up of simple building blocks.
Eliminating unnecessary thinking time
Your time is expensive. The amount of it you waste on unnecessary thinking increases in proportion to the model's inconsistency and complexity.
Good financial modelling is like good business writing.
"Write to express, not to impress" - Mini Qarabaghi
Technical debt in financial models
Excel has very little inherent structure. Any structure your model has is going to have to come from you.
What Irish monks from the 7th century can teach us about Financial Modelling
Financial Modelling wisdom comes from the strangest places.
Cleverness is not wisdom
There is an incentive for consultant financial modellers to build complex, hard to understand models.
As simple as possible
"Everything should be as simple as possible, but not simpler."
Model complexity compounds business complexity
"The map is not the territory" - Alfred Korzybski.
People often confuse models of reality with reality itself. Models represent things, but they are not identical to those things.
This is true of financial models.
A financial model is an abstract representation of a business. The job of