This is an essential course for those who require an understanding of Risk analysis, Risk modelling , credit risk management and Corporate Finance.

Previous experience with excel is preferred.

Day One - Cash Flow Modelling

Module 1: Model Design

Overview of the course
Project case study outline
Useful Excel methods, features and techniques
Common pitfalls and mistakes in Excel
Exercise: Risk model review

Module 2: Model Planning

Model design and structure – key steps
Planning the risk model
Required sheets, calculations and modules
Modelling the initial assumptions, income and balance sheet
Case: completing and checking the template

Module 3: Adding Forecast, Cash Flows and Ratios

Structured model with a menu and accounting statements
Calculating key financial ratios
Deriving a UK and international cash flow
Net present value calculation
Case: adding cash flow and ratios to calculate an NPV/IRR

Module 4: Auditing and Testing

Classification of Excel errors
Essential techniques
Case: checking model completion

Day Two - Risk Modelling

Module 5: Risk and Risk Mapping

Risk mapping
Defining scenarios
Identifying and forecasting key drivers
Linkages and modelling problems
Case: Reviewing forecast drivers

Module 6: Risk and Sensitivity Methods

Risk techniques
Charts and scenarios
Standard deviation
Coefficient of variation
Standard deviation and certainty equivalents
Decision trees
Options approach and probabilities
Case: using sensitivity analysis to compare two projects

Module 7: Defining Dynamic Scenarios

Scenarios in Excel
Making scenarios dynamic
Management reporting
Exercise: adding scenarios to choose ‘optimum’ solutions

Module 8: Risk Quantification

Tornado and spider charts
Automating reporting
Exercise: adding tornado charts to the template

Day Three - Simulation Modelling and Optimisation

Module 9: Simulation Modelling

Adding simulation in Excel
Distributions
Scatter charts and histograms
Understanding limitations
Case: modelling simulation in Excel

Module 10: Alternative Simulation Methods

Constructing simulation models using add-ins
Determining questions to be answered
Determining input distributions from data and from expert opinion
Running simulations
Case: Modelling a simulation using the template model

Module 11: Optimising Simulation

Testing assumptions
Optimising and reporting methods
Presenting and interpreting results
Exercise: optimising the simulation example

Module 12: Management Reporting and Model Review

Model completion
Management reporting and summary
Summarising all the model results
Final audit
Help and user assistance
Securing and protection
Documentation and maintenance