Financial Modelling & Model Quality
Once More, With Feeling
A gentle rehearsal of all the things we know – and sometimes forget – about good financial modelling
There comes a moment – between formula and formatting, between the rush of deadlines and the quiet sigh of “done” – when we remember that this isn’t just about spreadsheets.
It’s about trust. It’s about clarity. It’s about taking care.
And so, once more, with feeling.
The Forgotten Wisdom
We’ve all been there.
We know what good modelling looks like. We’ve read the standards. We’ve attended the trainings. We’ve nodded along at every sensible best-practice checklist.
And yet…
“Just this once, I’ll hardcode it.” “I’ll clean that up later.” “No one else is going to look at this anyway.”
But someone will. Maybe it’s your client. Maybe it’s your colleague. Maybe it’s you, six months from now, trying to remember why you did it that way.
Let this be your quiet reminder.
Structure before speed. Design before detail. Purpose before perfection.
Because financial modelling isn’t a performance. It’s a rehearsal for better decisions.
The Rule of Thumb Isn’t a Shortcut – It’s Muscle Memory
There’s wisdom in the old sayings – “One row, one formula.” “Left to right, top to bottom.” “Inputs blue, calculations black, outputs green.”
Why do these rules persist? Because they work. They reduce friction, speed up reviews, and help us see structure before we even click.
So remember:
Keep each formula doing one thing only. Limit formula length to something readable – break it down when needed. If you can’t explain a formula in one sentence, it’s probably doing too much. Hardcodes belong in input sheets, not in cell AJ98 inside an IF nested in a SWITCH inside a LET.
Let your future self shake your hand, not your head.
Complexity: Add Only What You’re Willing to Explain to a Non-Excel Person
Every modeller has faced the temptation.
“Let me just nest one more function…” “This would look great with OFFSET and INDIRECT.”
But the better question is this:
Can I explain this logic to someone – out loud, in under a minute – without opening Excel?
If not, maybe it doesn’t belong in the model.
Sophistication is not the same as usefulness. Real mastery is knowing what not to model.
Habits That Build Model Trust – and Reduce Audit Risk
When people distrust your model, they rebuild it. That costs time, credibility, and momentum.
So make it clean. Make it obvious. Make it thoughtful.
Freeze panes – always. Add a version control sheet. Label your sheets. Add a model map. Mark inputs clearly. Document outputs. Explain how the thing works. Validate, balance, cross-check. Don’t hope it works – prove it.
A tidy model is like a well-laid table. It invites confidence – even before the meal is served.
Self-Audit Before the Review: What Modellers Should Ask Themselves
Before anyone else checks your model, you should. Here’s a short pre-flight checklist:
Are all inputs visible and traceable? Is any logic buried or duplicated? Are outputs clearly signposted and labelled? Are there any hidden sheets, hidden rows, hidden horrors? Can someone else understand what I did – and why?
Models are not just tools – they are promises. Do your numbers keep theirs?
Why Standards Matter
Too many modellers see standards like FAST, or the Financial Modelling Code as bureaucratic or rigid.
In truth, they’re like sheet music for musicians. You can improvise – but only if you know the tune.
Standards are a shared language. They help models travel between minds, teams, borders. They allow for scale, audit, growth, and confidence.
They are not fences. They are lighthouses.
Common Phrases That Signal Trouble – and What They Reveal
“It works if you don’t touch it.” “Just don’t change that sheet.” “It’s a bit messy, but I know where everything is.” “I had to use INDIRECT.”
We’ve all said things like this. But perhaps it’s time to gently notice what they really mean. Fragile structure. Unclear logic. Hidden dependencies. Avoidable risk.
When you hear them – pause, reflect, and consider: can this model grow? Can it survive? Can it teach?
Once More, With Feeling
So take a breath. Tidy that assumptions sheet. Split that formula in two. Press F9 with pride.
This isn’t about perfection. This is about presence.
It’s about choosing to care – even when it’s late, even when the model works “well enough”. It’s about choosing the craft, again and again, until the habit becomes a kindness.
Because financial modelling isn’t poetry. But it can be poetic.
A structured workbook is a quiet sonnet of logic. A reconciled balance sheet is a whispered truth. A clean, auditable file is a gesture of respect.
And so we return – not to repeat, but to refine. Once more with feeling.
Keep calm and model on.
