Financial Modeler's Corner Paul Barnhurst AKA The FP&A Guy

Welcome to the Financial Modeler's Corner (FMC), where we discuss the Art and Science of Financial Modeling with your host Paul Barnhurst.
Financial Modeler's Corner is sponsored by the Financial Modeling Institute (FMI), the most respected accreditation in Financial Modeling globally.
In today’s episode, Paul engages in a conversation with Stephen Aldridge, to discuss developing and implementing Financial Modeling standards and best practices, including insights from his work on the Financial Modelling Code. This conversation is packed with practical advice and fascinating anecdotes.
Stephen, the founder of Numeritas, has over 20 years of experience in Financial Modeling. Stephen has worked with and for top firms like KPMG and Deloitte. With a background in engineering, sales, and corporate management, he offers a unique perspective on Financial Modeling standards and best practices.
Key takeaways from this week's episode include:
Standards in Financial Modeling ensure consistency and reliability in financial models. Having an agreed-upon approach within a firm allows for seamless transitions when different individuals work on the same model, promoting accuracy and ease of understanding.
Financial modeling involves various acceptable methodologies, making consensus on best practices challenging. Flexible guidelines, like the Financial Modeling Code, help streamline processes and ensure consistency across different approaches.

Prototyping in Financial Modeling bridges the gap between modelers and users by creating early mock-ups of input areas. This approach ensures the model meets user expectations and captures necessary inputs accurately, saving time and resources in the long run.

Human factors, such as biases and assumptions, significantly impact financial modeling. Effective communication and understanding stakeholder interactions are crucial for creating accurate and practical models.

In implementing Modeling Standards, Firms should adapt modeling standards to their specific needs with a focus on basic principles like avoiding hard coding and maintaining consistency to enhance model quality and reliability.

Quotes:  

Here are a few relevant quotes from the episode on financial analysis and modeling:
“I suppose a few things within a firm, you probably want a house style, at least an agreed approach, so that if somebody else picks up the model, has to work on it or somebody leaves, then you've got continuity.”“Prototyping helps the user to see what they like to get. If they think, oh no, this isn't what I would imagine, what about these things then? You're getting all that out in the open before you start coding.”“It's very important to think about the human aspect of modeling and what goes around it as well, and the assumptions we make and the bias that can creep in and all these sorts of things.”“Keep the user at the center of everything you do, keep them at the center of your thinking, and that way you'll produce a model that's much easier to use, and likely to have a longer life.”
Sign up for the Advanced Financial Modeler Accreditation Today and receive 15% off by using the special show code ‘Podcast’. Visit www.fminstitute.com/podcast and use...

Welcome to the Financial Modeler's Corner (FMC), where we discuss the art and science of financial modeling with your host Paul Barnhurst.
Financial Modeler's Corner is sponsored by the Financial Modeling Institute (FMI), the most respected accreditation in Financial Modeling globally.
In today’s episode, Paul engages in an interaction with Carolina Lago and discusses the essential tips for transforming data into actionable insights and the strategic approach to avoiding common modeling pitfalls. This discussion offers valuable wisdom that will enhance your analytical skills and financial acumen.
Carolina, a seasoned FP&A professional with over 15 years of international experience, shares profound insights from her extensive career, including her role in a significant IPO and leading software implementation across global departments.
Key takeaways from this week's episode include:
An early career encounter with a poorly designed financial model, filled with hard-coded numbers, underscores the necessity for creating flexible and dynamic financial models that can adapt to changing business needs.

The discussion highlights the critical need to avoid hardcoded data and external links in financial models, which can lead to rigidity and errors.

Insights from the financial modeling newsletter and courses show a wide range of professionals benefiting, from newcomers to seasoned directors. This variety demonstrates the widespread need for improved modeling skills.

The discussion focuses on the importance of transforming data into actionable insights. It's stressed that without the ability to analyze and interpret data effectively, its value is minimal.

The conversation sheds light on techniques for deriving actionable insights from complex data, crucial for any financial modeler. It also discusses the value of formal certifications like the Advanced Financial Modeler Certification as tools for professional development and skill validation.

Quotes:  

Here are a few relevant quotes from the episode on financial analysis and modeling:
“I inherited one, and I had to try to change it. I spent probably a couple of weeks trying to make it better, and I couldn't. It was just too full of hardcoded numbers and I had to find everything the way around and no design at all.”

“The first thing I learned about financial modeling was not to use hard codes and don't link outside of the spreadsheet.”

“Data is only useful if it can be transformed into actionable insights.”

“The TACTIC is (Targets, Assets, Calculations, Tools, Insights, and Correlations.) You start with the target which is the question that you need to answer with that financial model.” 

“That's why I like financial modeling so much because it can transform data into something. So you can make decisions on top of that data.”

Sign up for the Advanced Financial Modeler Accreditation or FMI Fundamentals Today and receive 15% off by using the special show code ‘Podcast’. 

Visit www.fminstitute.com/podcast and use code Podcast to save 15% when you register.  

Go to https://earmarkcpe.com, download the app, take the quiz and you can receive CPE credit....

Welcome to the Financial Modeler's Corner (FMC), where we discuss the art and science of financial modeling with your host Paul Barnhurst.
Financial Modeler's Corner is sponsored by the Financial Modeling Institute (FMI), the most respected accreditation in Financial Modeling globally. https://www.abacum.io
In today’s episode, Paul engages in a conversation with Geoff Robinson, to discuss the financial modeling world, blending technical skills with behavioral economics to enhance decision-making in finance.
Geoff Robinson, founder of TheInvestmentAnalyst.com and seasoned financial modeler with a rich background in investment banking and education, notably as a former managing director at UBS.
Key takeaways from this week's episode include:
An unconventional entry into investment banking at 43, highlighting how the background in education enriches the approach to financial analysis and modeling, emphasizing the crossover skills between teaching and financial analysis. This highlights how teaching skills are transferable and beneficial in the financial analysis and modeling sectors.An anecdote about a significant error in a financial model, which failed to detect a $29 billion discrepancy, underscoring the critical importance of rigorous validation and diagnostic checks in financial modeling.In the role of behavioral factors in financial modeling, adopting a stance of professional skepticism and the need for understanding and questioning the assumptions underlying a model before trusting its output.For simplicity and planning in financial modeling, the most effective models are those that are straightforward, well-planned, and can communicate complex financial insights in an accessible manner.Strategies for mitigating bias, such as incorporating different perspectives and rigorous testing of hypotheses, as the influence of cognitive biases on financial modeling to enhance the reliability of financial models.
Quotes:
Here are a few relevant quotes from the episode on financial analysis and modeling:
"The diagnostic on this model was said if total assets equal total liabilities and equity, okay. So no matter what happened, your balance sheet, even if it was mashed up, the diagnostics said it was fine and when you went into the detail, there was a $29 billion hole in that balance sheet."
"Financial models are a real kind of insight and window into the personality of the modeler. You can see how they think, you can see how they overcomplicate things. You can see if they're sloppy."
“Models are question-asking tools. One of your questions was is it a primary decision maker, a financial model? I don't think models are decision-makers. I think models are the way you test a hypothesis.”
"I suppose the blunt thing to say is don't trust anything until you understand it."
Follow Geoff:
LinkedIn - https://www.linkedin.com/in/geofftheinvestmentanalyst
Website - https://theinvestmentanalyst.com
Follow Paul:
Website - https://www.thefpandaguy.com
LinkedIn - https://www.linkedin.com/in/thefpandaguy
For an experienced-based approach to financial modeling, emphasizing skepticism, the effective communication of complex financial data, and the intersection of analytical rigor, educational techniques, and behavioral economics, visit FMI at www.fminstitute.com/podcast and use code ‘Podcast’ to save 15% when you register. Contact Paul Barnhurst for further details.
In today’s episode:
(01:58) Introduction
(02:44) Guest Introduction
(03:00) Horrifying Financial Models
(04:01) Joking on Big Numbers
(04:24) Approach to Financial Modeling
(05:14) Behavioral Insights in Modeling
(05:56) Best Practices and Lessons Learned
(42:40) Rapid-Fire Question...

Welcome to the Financial Modeler's Corner (FMC), where we discuss the art and science of financial modeling with your host Paul Barnhurst. Financial Modeler's Corner is sponsored by the Financial Modeling Institute (FMI), the most respected accreditation in Financial Modeling globally.
In today’s episode, Paul engages in a conversation with Scott Rostan, Founder of Training The Street.
Scott found his passion for finance with his dedication to teaching and has been driving innovation in financial training ever since. As CEO of Training The Street and as an adjunct professor at UNC Kenan-Flagler Business School, he inspires the next generation of finance professionals
Through his leadership as CEO of Training The Street, Scott has reshaped the landscape of financial education, equipping individuals with the skills and knowledge needed to thrive.
In this episode, expect to learn:
The significance of technical skills, such as financial modeling, accounting, and Excel proficiency, in the finance industryHow specialized training programs can help individuals enhance their financial knowledge and technical abilitiesThe evolving role of AI in finance and how it complements human expertise rather than replacing itThe balance between technical proficiency and interpersonal skills to excel in their careersHow individuals can build trust with clients, colleagues, and stakeholders, ultimately contributing to the integrity and credibility of the finance profession.
Quotes:  
“It's really easy to start throwing stuff together and writing a nasty old nested if formula or whatever it might be, but that doesn't always mean it's clean or effective or meets those requirements we talk about.”
“And when you get good with the prompt engineering typing, questions, and answers, you can get a lot more productive and faster.”
“It's not ideal because circular references can make your model more complex and harder to understand, but in certain situations, they're necessary for accuracy.”
“If you just blindly took the financial information from this database, it could be off by a big factor. So again understanding what's going on, understanding the nuance, understanding the limitations is going to be much more valuable.”
“They're going to trust you and value you to distill what's important and then present it in an easy-to-digest way so that they can understand in simple terms what is happening. The analysis comes from the model, but the story is going to come from you.”
Sign up for the Advanced Financial Modeler Accreditation or FMI Fundamentals Today and receive 15% off by using the special show code ‘Podcast’. 
Visit www.fminstitute.com/podcast and use code Podcast to save 15% when you register.  
Go to https://earmarkcpe.com, download the app, take the quiz and you can receive CPE credit.  

Follow Scott:    
LinkedIn - https://www.linkedin.com/in/scott-rostan-86b44417aWebsite - https://trainingthestreet.com/

 Follow Paul: 
Website - https://www.thefpandaguy.com/   LinkedIn - https://www.linkedin.com/in/thefpandaguy/  TikTok - https://www.tiktok.com/@thefpandaguy  YouTube - https://www.youtube.com/@thefpaguy8376  

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In today’s episode:  
[00:45] Introduction;
[01:00] Scott’s horror story of the worst Financial Model;
[01:58] The KISS principle;
[03:53] Scott’s...

Welcome to the Financial Modeler's Corner (FMC), where we discuss the art and science of financial modeling with your host Paul Barnhurst. Financial Modeler's Corner is sponsored by the Financial Modeling Institute (FMI), the most respected accreditation in Financial Modeling globally.
In today’s episode, Paul engages in a conversation with Roderick McKinley, blockchain & Tokenomics advisor of Rmckinley.net
Roderick, a crypto expert, discusses financial modeling in the crypto space, highlighting challenges like token volatility and treasury management. He emphasizes aligning incentives for healthy exchanges and discusses his online course on Tokenomics Modeling and fundraising.
Roderick also offers strategic guidance, product development, and Tokenomic design services for various blockchain applications, including DeFi, blockchain games, and Layer 1 protocols. He assists in developing tokenized business models, designing token utilities, and structuring token allocations for successful capital raises.
In this episode, these are your learnings:
Understand the integration of finance and blockchain and Tokenomics and strategic guidance for blockchain projects.Gain insights into challenges and opportunities in transitioning from traditional finance to the crypto space.Learn how to navigate complexities like token volatility and incentive alignment in blockchain projects.Obtain practical tips on developing tokenized business models, designing token utilities, and structuring token allocations for successful fundraising.Acquire valuable knowledge for navigating the evolving landscape of blockchain and cryptocurrency.
Quotes: 
“Financial modeling often has a lot to do with client and industry expectations. What passes as good work or what passes as enough can change very dramatically from country to country and sector to sector.”

“Some of the stuff they teach you is that, well, the world's this way because it can't be any other way. And you pass exams sort of like explaining why it's impossible to fix things but suddenly blockchain technology actually gives you a completely different kind of tool chest that opens that up again.”

“Try and look for the shortest and most efficient way to express your calculations. Try and maximize the speed of your model.”

Sign up for the Advanced Financial Modeler Accreditation or FMI Fundamentals Today and receive 15% off by using the special show code ‘Podcast’.

Visit www.fminstitute.com/podcast and use code Podcast to save 15% when you register.

Go to https://earmarkcpe.com, download the app, take the quiz and you can receive CPE credit.

Follow Roderick McKinley: 
Linkedin: https://www.linkedin.com/in/roderickmckinley
Website: https://rmckinley.net/

Follow Paul:
Website - https://www.thefpandaguy.com/
LinkedIn - https://www.linkedin.com/in/thefpandaguy/
TikTok - a href="https://www.tiktok.com/@thefpandaguy" rel="noopener noreferrer"...

Welcome to the Financial Modeler's Corner (FMC), where we discuss the art and science of financial modeling with your host Paul Barnhurst. Financial Modeler's Corner is sponsored by the Financial Modeling Institute (FMI), the most respected accreditation in Financial Modeling globally.
In this episode, Paul is joined by Ian Bennett, Partner, Deals Modelling team at PwC, Australia.
With over 20 years of experience as a professional financial modeler, Ian has constructed and assessed models critical for major transactions, infrastructure projects, and routine forecasting and reporting. Today Ian leads the deal modeling practice for Pwc Australia.

In addition to being a world-class Modeller Ian is incredibly dedicated to diversity, inclusion, and wellbeing (DI&W). This has propelled him through various positions within PwC and beyond. As a proud LGBTIQ+ ally, he serves on the Steering Committee of Shine@PwC, the firm's LGBTIQ+ employee network, and currently holds the role of wellbeing lead for the Financial Advisory business.

In this episode, expect to learn:
Why understanding the stakeholders involved in a project is vitalWhy it's essential to listen actively to clients, understand their needs, and ask the right questionsHow to analyze the success and effectiveness of the financial modeling processWhat are the tools and technologies available in the marketWhat are the new technologies and methodologies for financial modelers to stay effective and successful in their roles

Quotes: 
“You need a desire to understand the power of the things you have in front of you and not be scared.”

“Every model tells a story, and that story is known at the start of the project, and the questions that the model will be able to answer.”

“Models are built for a single primary purpose at the time that they are conceived’

Sign up for the Advanced Financial Modeler Accreditation or FMI Fundamentals Today and receive 15% off by using the special show code ‘Podcast’.

Visit www.fminstitute.com/podcast and use code Podcast to save 15% when you register.

Go to https://earmarkcpe.com, download the app, take the quiz and you can receive CPE credit.

Follow Ian Bennett: 
Linkedin: https://www.linkedin.com/in/ianrbennett
Website: https://www.pwc.com.au/deals/modelling.html

Follow Paul:
Website - https://www.thefpandaguy.com/
LinkedIn - https://www.linkedin.com/in/thefpandaguy/
TikTok - https://www.tiktok.com/@thefpandaguy
YouTube - https://www.youtube.com/@thefpaguy8376

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