Financial modeling is the practice by which an organization conceptualizes a financial picture of some, or all aspects of the firm or given security that can be used to forecast a model of a security, a financial mechanism or an organization’s future financial performance based on the historical performance of the company. The model is typically characterized by performance calculations and makes recommendations based on that evidence. It may also specify particular events for the end user, such as asset management returns or it may assist in determining market trends, such as the Fed model.
Financial modelling, in general, includes many various financial factors such as cash flow predictions, debt, inflation, inventory, depreciation, revenue stream, and more. These models depict the company's present financial condition as well as its potential future financial situation.
There are many various sorts of financial models, based on the company's present financial condition and needs. Examples of such models include:
- Option Pricing Model
- Discounted Cash Flow Model
- Leveraged Buy Out Model
- Merger and Acquisition Model
Corpseed is a major provider of financial modelling services, offering complete financial modelling and analysis services such as outsourced financial analysis consultancy and automated financial modelling.