From the course: Financial Modeling Foundations

Unlock the full course today

Join today to access over 22,600 courses taught by industry experts or purchase this course individually.

Assumptions in financial statements

Assumptions in financial statements - Microsoft Excel Tutorial

From the course: Financial Modeling Foundations

Start my 1-month free trial

Assumptions in financial statements

“

- [Instructor] Building financial models really starts when we begin making assumptions about what's going to happen to the business over time. In particular, in order to get to future assumptions, we're going to have to start by examining what's happened historically. I'm in the 02_05_Begin Excel file. Now, what we have here are a set of assumptions ranging from assumptions related to TAM, Target Addressable Market, to Income Statement Assumptions and Balance Sheet Assumptions. And these are really key assumptions that we're going to need to take from what's happened historically to what's happened in the future in order to forecast where this business will be going. Now, each of these assumptions is going to be built on our historical data initially. So, for example, looking at Revenue Growth. This revenue growth of 5.1% can come from the balance sheet. So, if we wanted to understand what 2015 Revenue Growth is, it's simply going to be the difference between our 2015 Revenue and our…

Contents