Question

briefly discuss the role of financial modeling and whether it played an important part of not? in hindsight do you think it was a good deal and why? write 4-5 paragraphs .

Answer 1

A financial model helps in building a model to forecast the performance of a business .It is highly important in taking decision related to future aspects as it can be applied through different aspects of a business.

Financial forecasting is done on the basis of company's historical and pre assumptions and it requires to prepare an income statement,balance sheet and cash flow statement.

With the help of these, advanced models can be built such a discounted Cash flow, leveraged buyout, Mergers and acquisitions .

It always played an important part in different aspects of business as it could be applied through different merger and acquisition and levereged buyouts. It can also be used in raising capital through determination of different capital structure and selling of assets and divestment of the same.

Financial modeling helps in striving through the different adverse economic situation as it has always been proactive.It can be used as a modelling of Financial blueprint of firm overall objective and efficient and effective use of resources in order of attaining the firm's vision.