Auditing and Balancing a 3-Statement Model

Overview

The three-statement financial model forms the foundation on which many other models and analyses are built, and constructing a three-statement model is a critical skill for many roles in accounting and finance. In this course, we will cover the most common errors and issues that cause a three-statement model to be out of balance. We’ll show how to correctly find and fix these issues using error-checking best practices. We’ll also build some common error checks that can be used to quickly diagnose issues.

Highlights

• Review Excel's formula auditing and error checking tools.
• Identify the most common errors and sources of imbalance in a 3-statement model.
• Apply techniques to ensure consistency and accuracy across financial models, including checking for column alignment, row differences, and proper referencing.
• Reconcile changes in balance sheet accounts with corresponding cash flow statement entries to identify and resolve discrepancies effectively.

Objectives

• Determine the underlying causes of imbalances within a three-statement financial model using Excel's formula auditing and error-checking tools.
• Identifythe most common errors and sources of inconsistency in linking the income statement, balance sheet, and cash flow statement.
• Recognize effective techniques and error checks that ensure accuracy, alignment, and reconciliation across financial statements.

Preparation

Attendees should have a basic understanding of accounting fundamentals and Excel.