Transcript: Introduction to finance modelling — business.govt.nz

Introduction to finance modelling

Whenever you think about what's next for your business, where you are going to go in the future, it's always a good idea to see what the numbers are telling you.

Both in terms of where you currently stand, as well as making forecasts for what's going to happen afterwards.

The financial modelling section at business.govt.nz has a very user-friendly, step-by-step guide for setting up your own financial forecasts.

There is also a workbook, which does all the calculations for you and gives you all the answers. So that nothing is too scary.

Financial modelling is all about making forecasts of your cash flows in order to make informed decisions about your business. So, as long as you can understand your financial statements and what the cash flow forecasts mean, you are ready to create your own financial model.

If you are not sure that you understand how to read financial statements, please check out the relevant section of our website first.

Financial modelling takes your financial forecast to the next level. Financial modelling will help you, or your accountant or your business advisor, to identify the profitability of your business.

So, for example, you'll be able to see what the risks are to your cash flow and whether you will need more money, whether it's from lenders or investors.

If your finances stack up and your business is profitable, the next step is to work out how to fund your business.

Head to our website and explore our modelling workbook, at business.govt.nz

 

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