Modelling best practice – actions speak louder than words

Best practice financial modelling


John Dimberline


31 Jul 2019




There’s no shortage of blogs, articles and opinion pieces on how we should go about building a financial model, but they only really scratch the surface and need some imagination to go from principles to practicality. That’s why we’ve put together an example model to share with anyone who’s interested in taking a look.

But a few words to sit alongside our free example financial model are still useful. I think we can all agree that financial models should be built according to generally accepted best practice principles. At the top of a fairly long list for me are:

  • consistent timelines;
  • separate inputs, workings, and outputs;
  • consistent formulas; and
  • no embedded constants.

These principles take you a long way towards building a robust financial model, but there’s a lot more to think about and to get right.

At F1F9 we also follow the FAST standard (, which is a documented set of rules and guidelines for constructing robust financial models. We’ve been using it for over 15 years while building 400+ models for our clients. The majority of the standard deals with the best practice financial modelling principles I’ve already mentioned, but importantly it builds on them with some additional rules that inform how the model should be structured. These rules and guidelines push us closer to where we need to be and one of the key benefits of FAST is that it forces us to build a much more accessible and transparent model.

But there’s still plenty more to do:

  • How do I incorporate actuals?
  • How do I organise my calculations?
  • How do I make labels clear and meaningful?
  • How do I structure the model so it can be easily adapted?
  • How do I minimise the number of links and references?

If you’re a financial modeller you’ll have an answer to these questions but there will be a lot of different answers. We’ve developed, changed and refined our opinions over the past 400+ models and think we’ve got some good answers. They’re not the only good answers, but whatever your method it needs to be considered at the outset and implemented rigorously through the build.

We think that our approach is one of the best, but nobody should accept this based on words alone.

John Dimberline
John has 18+ years of experience and has led advisory teams on a large number of complex projects supporting both public sector procurers, private sector bidders and corporates.