Mastering Financial Modeling

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is a comprehensive financial modeling workshop which covers the practical requirement that a finance professional is expected to do in areas related to Financial Modeling. Excel sheet is a predominant tool used in Modeling and the program shall cover its relevant usage in detail. The workshop has 32 classroom contact hours spanning four days from 8 am to 6 pm. Objective of this program is to build fundamental concepts on financial modeling and provide them techniques to build financial model needed by their organisation. ABOUT THE PROGRAM ©

starts with a 2 day basic program on financial modeling which explains about all the excel based financial modeling required by finance professional working in any sector. The latter 2 days goes in depth into the derivative solutions and its analysis and financial engineering models including the concepts of financial mathematics. Day 1-2: FINANCIAL MODELING WITH EXCEL (2 Days) It is a generic program catering to the needs of all corporate professionals working in any sector. This program will take an individual from basic to an intermediate level. Pre Requisite: None Day 3-4: MODELING AND ANALYSING DERIVATIVES USING EXCEL (2 Days) This is a neash financial modeling program which caters to only those working in derivatives and financial engineering. Pre-Requisite: It is expected participants should have an understanding of excel based financial modeling and working knowledge of derivatives. © Based on the need, you can enroll for entire 4 day program ( ) or for any of the two day program – Day 1-2: FINANCIAL MODELING WITH EXCEL (2 Days) or Day 3-4: MODELING AND ANALYSING DERIVATIVES USING EXCEL (2 Days)

HOW THE WORKSHOP WAS SHAPED Some of the research and data points we have used in shaping the agenda include: 1. Talking to Senior business and Finance management group, Financial consultants and analysts in the private and public sectors and seeking their views and advice on what are the critical issues in Financial Modeling and where they are investing budget. 2. Seeking the views of thought leaders, industry analysts and leading consultants to mould the agenda.













Also Attend: Modeling & Analysing Derivatives Using Excel –(From the same faculty) Mumbai – 6th & 7th October, 2010 Program Fee: INR 13,000/- + ST

PROGRAM OBJECTIVE MS Excel ® is today unarguably the most commonly used spreadsheet utility globally to do finance. In spite of this, according to various surveys on Excel usage, a rather miniscule percentage of Excel Users use it to its full potential. The focus of the course is to help the participants learn the tools and capabilities of this spreadsheet application to perform from the simplest to the most complicated and elaborate financial analysis. Modelling for Corporate Finance Transaction 

Case Outline and the process participants will go through in solving the case and structuring an LBO/MBO transaction

Acquirer input

Acquirer

Acquirer

historical

output:

DCF valuation

numbers and

Income

output

projected

statement,

numbers/

balance sheet

assumptions.

and cash flow

Sources of Funds: Funds:

How the LBO/MBO would be

Financial

funded. How

Sponsors

much debt needs to be







The good thing about an over-engineered software like Excel is that it very well equiped to perform the most sophisticated and detailed financial analysis. The downside to this is that financial analysis workbooks are becoming increasingly bulky and unstructured. Many a times, they develop into unweildy, clumsy and difficult to manage models, with the user having no clue as to what’s going in the spreadsheet and if the results are accurate in the first place. Therefore, structuring good financial models is as much an art as a science. The important aspects this workshop focuses on is to apply the tools effectively while constructing financial models, caring for scalability, making them flexibile, structuring in such a way that auditing the model results is not cumbersome. These essential attributes make financial models accurate, flexible and user-friendly. The workshop would use a ‘learning by doing’ approach, because that’s how the science and art of financial modeling is learnt. Results: We expect that the participants attending the course will be able to learn significant financial modeling capabilities using Excel that would be pertinent for corporate finance, financial analysis, risk management, transaction structuring like modeling for M&A, etc. The level of the course is Intermediate to advanced. KEY BENEFITS -

Master the use of Excel’s financial modelling tools and capabilities How to design a model to suit your purpose Understand the different types of financial models and when each should be applied Construct financial models making use of a broad range of Excel methods and techniques Accurate forecasting corporate cash flows for project finance deals and structures

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Incorporate elements such as risk, sensitivity, optimisation and forecasting into financial models Produce meaningful management reports and charts for communication How to identify and control key sensitivities through advanced spreadsheet simulation How to design a model to maximise flexibility and reliability Practical tips for checking and debugging the mode







PROGRAM FACULTY Our faculty is an experienced Investment Banker and a guest faculty in finance in IIMs, who specializes in Fixed Income, Foreign Exchange and Credit Derivative products. We has conducted training programs for bank s and corporates in India, Singapore, Hong Kong, Middle East, and South Africa on topics such as Credit Derivatives, Fx Derivatives, FI Derivatives, ALM, M&A, Financial Modeling for LBOs, Debt Capital Markets, Basel II and Risk Management. WHO SHOULD ATTENTD       

Corporate Finance Professionals Quantitative analysts Investment Bankers Risk professionals Treasury managers Controllers Data analysts and economists

DAY ONE

Session One: Creating the first financial statement model in Excel to begin with (with an exercise and hands on practical session; focus on how to build a model right from the scratch, linkages with excel spread sheets, assumptions, use of past financial statements for the projections and building forecasted financial statements) Important issues for preparation and building of a financial model Excel Functions and commands to supercharge worksheets (most of the participants may be aware about the functions, yet just a quick revision and how these functions are used in financial modelling) 

Different ways of summing and counting: SUMIF;

 

Data Analysis Toolpak Important Excel Functions and commands for modeling  Conditional Formating  Online collaboration  Auditing  Protecting the workbook  Sharing the workbook  Data Validation  Handling external data  Sorting  Filters  Subtotals  Pivot Tables

Session Two:









DAY ONE (Cont.) 

Scenario Building  Switches  Forms  Scenario building optimistic, base case and pessimistic assumptions

DAY TWO Session Three : Topics in Finance 

Principles of financial modelling— modelling—Accuracy, Flexibility & User-friendliness

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Defining Model objective

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Outlining model plan

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Spread sheet maps

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Flowchart and information flow

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Layout and architecture of financial model

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Setting up modules

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Identifying inputs and variables

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Defining deliverables and functionality

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Cataloguing outputs

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Stress testing Models

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Model Documentation

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Financial Statement modelling

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Projection of Revenues, COGS, SG&A and other Income Statement and Balance Sheet items Select model drivers and assumptions

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Modelling term structure of WaCC

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DCF valuation

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Relative valuation (PE, EBITDA multiple)

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Combining DCF and relative valuation models

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Modelling for Leveraged Buy Out & Management Buy Out

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Sources of funds for acquisition

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Modelling uses of funds

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Modelling ESOPs and Earn-Outs

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Partial and full dilution due to ESOPs

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IRR calculation for financial sponsor on fully diluted basis

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Purchase Accounting Model

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Model for Stock-for-Stock Deal

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Model for Cash-for-Stock Deal

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Modelling when M&A financed by issue of debt

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Model illustrating Accounting for a partial Acquisition

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Accretion Dilution Model













Also Attend: Financial Modeling With Excel –(From the same faculty) Mumbai – 4th & 5th October, 2010

Program Fee: INR 13,000/- + ST

PROGRAM OBJECTIVE A common misconception is that understanding derivatives requires knowing a lot of advanced math which is the privilege of only the geeks. That said, sometimes you probably wonder wonder how do these large bunch of I-Bankers manage to provide derivative solutions to their clients because they don’t seem to have been rocket scientists in their previous avatar. There would have also been questions like how do you actually engineer those financial products? May be, you read something called Black Scholes, Ito’s Lemma, and so on but they didn’t quite answer those questions convincin gly, much less, make sense in the context of the real world of

finance. In the last two decades, derivatives have become all-pervading in financial markets with outstanding notionals in excess of US$ 600 trillion. If your profession has anything to do with finance, then there is a pretty high chance that you will have something to do with derivatives at some point or the other. This course tries to demystify and simplify derivatives derivatives using a tool like Excel. For a practioner, it may be difficult to relate th e BlackScholes equation but it would probably start to make sense once you start thinking like an accountant about all these greeks and put the differential equations in excel. In the workshop, we will start to think of each of these greeks in terms of money, which is what traders do. The program covers a comprehensive list of topics that derivative practioners need to understand for their day-to-day work.







PROGRAM FACULTY Our faculty is an experienced Investment Investment Banker and a guest faculty in finance in IIMs, who specializes in Fixed Income, Foreign Exchange and Credit Derivative products. We has conducted training programs for banks and corporates in India, Singapore, Hong Kong, Middle East, and South Africa on topics such as Credit Derivatives, Fx Derivatives, FI Derivatives, ALM, M&A, Financial Modeling for LBOs, Debt Capital Markets, Basel II and Risk Management. WHO SHOULD ATTENTD       

Capital Market Professionals Quantitative analysts Investment Bankers Risk professionals Treasury managers Controllers Economists

KEY BENEFITS 







Understand financial engineering specifically, how derivative structures are engineered Pricing and risk management of Equity, FX, Interest Rate and Credit Derivatives Demystify and simplify the quantitative techniques in analysing derivatives using Excel Be aware of derivatives as risk management tools

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 

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Appreciate how derivatives are structured to suit client requirements Learn simulation techniques for pricing derivatives Learn how to solve any stochastic partial deferential equation (including Black Scholes equation) using spreadsheets Understand Greeks (Delta, Gamma, Vega & Theta)







DAY ONE Session One:  

  



Geometric Brownian Motion Financial variables with deterministic Jump and stochastic jumps Taylor series Our first differential equation Binomial Model  Binomial model for an asset price random walk  delta hedging  no arbitrage  the basics of the binomial method for valuing options  risk neutrality  Pricing exercises using Binomial model Simulating and Manipulating Stochastic Differential Equations 



 



Using Ito’s lemma to manipulate stochastic

differential equations Continuous-time stochastic differential equations as discrete time processes Simple ways of generating random numbers in Excel Correlated random walks

Monte Carlo Simulation and Related Methods  the relationship between option values and







multiple ways of deriving the Black–Scholes partial differential equation the assumptions that go into the Black –Scholes equation how to modify the equation for commodity and currency options

Session Two:



Replication of price of a derivative product in general is the cost of risk managing it Excel Exercise using a Partial Differential Equation Discrete Hedging  the effect of hedging at discrete times  hedging error  the real distribution of profit and loss

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Pricing exercises

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Vanilla Options  Call/Put Options  Contract specifications of Call/Put Options  Exercise: Pricing with Black Scholes Model and Monte Carlo Simulation in Excel Basic strategies containing vanilla options

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DAY TWO Session Three: Fx Derivatives and Interest Rate Derivatives 

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



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Fx Forwards, Fx Swaps  When to use an FX forward, Fx Swap  Pricing & Hedging Examples Fx Structuring Exercise in Excel: Corporate Client Fx Structuring Exercise: Cross border acquisition Interest Rate Swaps  LIBOR Swaps  MIBOR Swaps  OIS Swaps  Basis Swaps Cross Currency Swaps  Standard CCS with principal exchange  PO Swaps  CO Swaps Interest Rate Options  Receiver and Payer Swaptions

Session Four: Credit Derivatives  Credit Default Swap Pricing  Pricing First-to-default Basket  Copula Models for pricing credit derivatives: Gaussian Copula  Pricing CDO Risk management of Derivatives  Value at Risk  VAR as Downside Risk  VAR Parameters: Confidence Level, Horizon, Application: The Basel Rules  VAR Methods Counterparty Credit Risk for Derivative Transactions  Counterparty-level exposure  Credit Value Adjustment (CVA)







egistration form R egistration Yes, please register me for :

Fees

Financial Mode Financial Modeling ling With Excel (2 Days)

4th & 5th Octob ctober, er, 2010 201 0 - Mumba Mumbaii

Modeling & Analysing Derivatives Using Excel (2 Days)

6th & 7th Octob ctober, er, 2010 201 0 - Mumba Mumbaii

Both (4 Days) (Certificate of Participation from Carisma Brunel University London)

4th - 7th 7t h Octobe October, r, 20 10 - Mumbai Mumbai

Rs 13,000/*(Service Tax Applicable)

1.Email [email protected]

Rs 13,000/-

*(Service Tax Applicable) -

Rs 24,000/*(Service Tax Applicable)

2.Telephone +91 9094532918 +91 44-45018472

3.Fill this and post OptiRisk Learning Systems (P) Ltd. L468, Ground Floor, 21st Cross Street, Thiruvalluvar Nagar, Thiruvanmiyur, Chennai - 600041







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