Our procedures allow us to immediately identify errors the average user wouldn’t.
We’ve been auditing models for many years-we will help you produce an error-free model
Business going in the right Direction?
You will only know if you have the correct cashflows.
Why should I get my model audited?
If you are the owner of a company, project, transaction, or an idea, don’t you want to be 100% sure that your cashflow forecasts are correct?
If your forecasts are incorrect, you could be wasting money: making the wrong decisions re quantum or location of future spend: across capex, opex, employees, promoting one product versus another, building a new factory when demand forecasts are incorrect, or incorrect inflation forecasts have been used.
Submitting a model with error’s, in a bid or to a potential lender, or to any party – immediately reduces credibility of your business/ project/idea.
A financial model is only as strong as its weakest link. Hence the importance of a thorough model review.
An audit brings fresh eyes and an independent 3rd party who may notice issues that you haven’t.
In Excel, the “engine”/ the calculations, are “under the surface” – there could be a myriad of errors – invisible until it is audited.
In Financings: Some models are required to be audited as a Condition Precedent (CP) in a transaction as the financial model is the backbone of a transaction. Thus the model signed-off at financial close often becomes the legal decision-making tool post financial close that (in Project Finance) calculates (amongst other things) covenants, required additional repayments, build-up of reserves (i.e. DSRA) and distributions to equity (or restrictions thereof), and in all transactions generally (from an IPO of a gold mine to a cashflow forecast re a widget factory) – is one of the key files that will be referred to many years after the transaction.
What audit services do you provide?
Whatever the client requires : We offer varying levels of reviews, ranging from a quick “healthcheck” to a complete model review/ rebuild / interrogation of all inputs and calculations:
Healthcheck : Need a quick high-level review? A day is enough for us to review the model, including running “model maps”, and employ other tools in audit software, to give you a high level summary of issues.
Pre Audit check: If your transaction CP’s requires that the model is audited by a “Big 4” firm, you can save money by sending it to us first for an initial review, as we will not charge you substantial hourly rates to advise minor issues.
Checking calculations only (i.e. no checking against due diligence / documentation).
Checking that calculations agree with documentation.
Checking that inputs agree with documentation.
Adding error checks: We’ll fix the issues we find and add more error checks to help you in the future.
Full interrogation of inputs and calculations: more than just checking that the model agrees with the documentation, some clients requires us to “dig deeper”, understand the sector / service, and further question information providers.
Creating a new “shadow” model, that should deliver the same results in the base case and under sensitivities.