Any project you wish to undertake should begin with gaining an accurate understanding of what the project is all about. If you start off in the wrong direction, one of three things will happen:
- Part way through the project, you'll realize that this is not what the client wants, and you'll then have to start all over again
- You'll end up convincing the client to accept a project that was never intended
- You'll persist with the wrong project and it'll end up being rejected
So much depends on this stage that it typically takes up about 75% of your total modeling time.
In this chapter, we will cover the following topics:
- Discussions with management
- Building assumptions
- Building a template for your model
- Historical data
- Projecting the balance sheet and profit and loss account
- Additional schedules and projections
- Cash flow...