Strategic planning and cash flow management often require financial modeling to provide insight into your business’ near, and long-term, outlook. Financial modeling enables you to gain an informed view of underlying operational drivers and expected cash flow to help minimize uncertainty in your decision making.

Scenarios where a financial modelling helps in decision making

  • Purchasing ownership in a business: how can you gain a better understanding of the investment thesis? What impact will value creation opportunities, synergies and leverage have on overall returns?
  • Selling a division of a business: what are the cash flows of the division? Can management maximize value by carving out the division?
  • Obtaining new financing: how much new debt can your business support? Will your company’s cash flows be sufficient to make debt repayments and maintain financial covenants?
  • Scenario and “what-if” analysis: should you expand into new service lines? What happens to cash flow if anticipated revenue and expenses vary from the projections?
  • Industry-specific analysis: what is the size of the market, target market share, customer acquisition costs and ultimate path to profitability?

How Can Smythe Advisory Help?

The risk of using an incomplete financial model is that it could provide an unrealistic outlook on the future of your business. At Smythe Advisory, we assess the needs of each client individually to create comprehensive static and dynamic financial models. Whether being used as part of a formal report or for use as an ongoing planning tool, we advocate for a collaborative approach to determine reasonable, forward-looking assumptions in order to create a model that will help you make important decisions.

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Alex Wong

Partner & Practice Group Leader
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