THE PEOPLE BEHIND THE NOTES

David Mikadze

Writing about spreadsheet practice and financial modelling for FinX Academy.

Field notes by David

42 GUIDES

The fictional annual revenue budget stays at 1,180. The April forecast is 1,187 and the July forecast is 1,193, with the final change split into 2 of actual variance and 4 of forward revisions.

Budget vs forecast: update expectations without rewriting the plan

Learn the difference between a budget and a forecast with a dated monthly case: a variance bridge, two forecast versions and the annualising trap.

14 Sept 2026Read guide

$A fraction from the article: EBITDA 44.0 minus cash taxes 6.0 minus maintenance capex 8.0 over interest 8.0 plus scheduled amortisation 20.0 plus lease 2.0, giving 30.0 divided by 30.0, or 1.00 times.$

Modelling7 min read

Fixed charge coverage ratio: define the obligations before calculating

Calculate fixed-charge coverage under two stated conventions, reconcile debt service, and test a fictional covenant without double-counting lease payments.

14 Sept 2026Read guide

The condition tests for entity MRN, account Freight and date 2026-02-02 multiply into a single matched flag of 1, and INDEX returns that row’s amount, 2,100.

Excel9 min read

INDEX MATCH with multiple criteria: solve a finance lookup exercise

Practise INDEX MATCH on a fictional ledger: entity, account and date criteria, a duplicate combination, a missing one and a text-stored date — with worked answers.

14 Sept 2026Read guide

A two-row ledger comparison: identical supplier and amount on different invoices is kept, while the re-keyed invoice RW-2412 is the row removed.

Excel9 min read

Remove duplicates in Excel: protect legitimate finance transactions

A payments ledger where look-alike rows are real transactions. Derive the composite key, preview removals with COUNTIFS, and reconcile control totals before anything is deleted.

14 Sept 2026Read guide

Year 1 NOPAT of 42 divided by invested capital of 200 gives 21 percent ROIC. Year 2 NOPAT of 46.5 gives 23.25 percent using opening capital and 23.37 percent using average capital.

Modelling8 min read

ROIC formula: calculate returns on invested capital consistently

Build and audit a return on invested capital: reconcile NOPAT and invested capital two ways each, choose a denominator convention, and catch three inconsistencies.

14 Sept 2026Read guide

The acquisition requires 437.6 of uses, funded by 225 of new debt, 15 of target cash and a sponsor equity contribution of 197.6. The equity plug makes the totals balance but does not validate the deal assumptions.

Modelling11 min read

Sources and uses: balance acquisition funding in a worked example

Build a sources and uses table for a fictional buyout: offer basis, refinancing, fees and the sponsor equity plug — then run the checks that catch what the plug hides.

14 Sept 2026Read guide

CAPM example: 4 percent risk-free rate plus beta of 1.2 times a 5 percent equity risk premium equals a 10 percent cost of equity.

Modelling10 min read

Cost of equity formula: build a CAPM estimate and explain its limits

Assemble Northgate's cost of equity from a dated risk-free rate, beta and equity risk premium, catch a 604% units error and two silent wiring errors, and price the range.

14 Sept 2026Read guide

Football field valuation ranges from the article: trading comps 560 to 720, DCF 600 to 700, and precedents 680 to 840, with a market EV reference of 640.

Modelling7 min read

Football field valuation: build and check a valuation chart

Build a football field valuation chart in Excel with consistent enterprise-value ranges, a market reference, and checked bridges to equity value and value per share.

14 Sept 2026Read guide

A timeline separates LTM’s four reported quarters from NTM’s four forecast quarters at the latest closed quarter.

Modelling9 min read

LTM vs NTM: compare valuation multiples on consistent periods

Bridge four fictional quarters into LTM EBITDA, build NTM from a dated forecast, and see the exact 6.67% by which a mismatched denominator imports the growth rate twice.

14 Sept 2026Read guide

Deal analysis flows from the headline equity price through debt and cash adjustments to enterprise value, then into a consistent EV-to-EBITDA comparison.

Modelling10 min read

Precedent transaction analysis: select deals and build a valuation range

Build a precedent transaction analysis in Excel from a fictional deal set: rebuild headline prices into enterprise value, screen comparability and derive a checked valuation range.

14 Sept 2026Read guide

The article’s revenue bridge starts at 315.00, rebases by minus 0.40, adds 13.20 of volume and 7.71 of pricing, and ends at 335.51.

Modelling9 min read

Revenue forecasting: build a price-and-volume driver model

Build a monthly revenue forecast in Excel from contract and job drivers, reconcile the annual bridge, and test changes in pricing and additions.

14 Sept 2026Read guide

Peer beta comparison strips leverage from each company: Alder 1.350 to 1.200, Birch 0.975 to 0.900, and Cedar 1.166 to 1.100.

Modelling8 min read

Unlevered beta: remove and reapply leverage in a peer analysis

Strip peer leverage with the Hamada formula on a fictional comps set, relever to the target's capital structure, and catch the basis and order errors that distort the result.

14 Sept 2026Read guide

Cash conversion timeline: inventory sells at day 66, customers pay at day 117, suppliers are paid at day 45, leaving a 72-day cash gap.

Modelling7 min read

Cash conversion cycle: DIO, DSO and DPO in one worked example

Calculate the cash conversion cycle from a year of financials, see why the answer depends on stated conventions, and turn a longer cycle into the extra cash it funds.

11 Sept 2026Read guide

Second-quarter DSO example: receivables of 1,700 divided by credit sales of 2,600, multiplied by 91 days, equals 59.5 days.

Modelling7 min read

Days sales outstanding: calculate DSO and forecast receivables

Calculate DSO three ways on a seasonal distributor, catch the year-end snapshot that flatters collections, and turn a defended day-count into a forecast receivables balance.

11 Sept 2026Read guide

A staggered cohort schedule shows existing assets and each year’s new capital spending contributing depreciation from their acquisition year.

Modelling8 min read

Depreciation schedule in Excel: connect capex, depreciation and net PP&E

Build a three-year property and equipment schedule in Excel: a cohort table for the charge, roll-forwards for gross and accumulated, and the checks.

11 Sept 2026Read guide

Two timelines contrast equally spaced IRR periods with XIRR’s actual cash-flow dates at days 0, 194, 343, 602 and 731.

Excel7 min read

IRR vs XIRR: choose the return calculation that matches the dates

Apply Excel's IRR and XIRR to the same irregularly dated investment, watch the two answers disagree, and learn which function reads the calendar and which only counts rows.

11 Sept 2026Read guide

A single scenario switch selects base, upside or downside assumptions together, rather than mixing inputs from different cases.

Excel7 min read

Scenario analysis in Excel: base, upside and downside cases

Switch a finance model between base, upside and downside cases with one driver cell, check each case with hand calculations, and see how scenarios differ from sensitivity grids.

11 Sept 2026Read guide

WACC example weights equity of 480 and debt of 200; a 10 percent equity cost and a 3.75 percent after-tax debt cost produce 8.16 percent WACC.

Modelling8 min read

WACC formula: assemble and audit the discount rate

Assemble Northgate's WACC in Excel from a transparent, cell-by-cell assumptions table, cross-check it two ways, and see how a 0.37-point error moves a terminal value.

11 Sept 2026Read guide

A circular dependency connects the cash shortfall to new borrowing, interest expense and back to the cash shortfall.

Excel8 min read

Circular references in Excel: trace the loop before you iterate

Reproduce an accidental self-including SUM, then build a revolver loop that funds its own interest. Compare timing, algebraic and iteration fixes with checked numbers.

9 Sept 2026Read guide

Year-one interest coverage is EBIT of 32 divided by interest expense of 8, or 4 times.

Modelling7 min read

Interest coverage ratio: calculate it and explain what changed

Calculate three years of interest coverage on a fictional borrower, compare EBIT and EBITDA conventions, run a downside and reconcile the interest figure to the debt schedule.

9 Sept 2026Read guide

Percentage change diagram distinguishes new divided by old from the change formula, new minus old divided by old; a zero base cannot produce a percentage change.

Excel6 min read

Percentage change in Excel: growth, declines and zero bases

Calculate percentage change in Excel with one formula, catch the ratio-not-change mistake, and handle negative and zero starting values and percentage points on a checked variance table.

9 Sept 2026Read guide

Two terminal-value methods: next year’s free cash flow divided by discount rate less growth, and final-year EBITDA times an exit multiple; both are values at the forecast’s end.

Modelling7 min read

Terminal value formula: compare perpetual growth and exit multiples

Calculate terminal value both ways on one fictional forecast, discount each correctly to today, and expose the implied growth rate and implied multiple hiding inside your assumption.

9 Sept 2026Read guide

Unlevered free cash flow bridge from the article: EBITDA 80 less operating cash taxes 14, capital expenditure 20 and working-capital investment 4 gives free cash flow 42.

Modelling7 min read

Unlevered free cash flow: bridge EBITDA to cash

Reconcile EBITDA to unlevered free cash flow in one worked example, cross-check it with a tax-shield shortcut, and see how the levered figure differs.

9 Sept 2026Read guide

Five annual revenue points from 2021 to 2025 show four compounding periods and an 11.58 percent CAGR.

Excel8 min read

CAGR in Excel: calculate growth and catch the wrong period count

Calculate CAGR in Excel from a five-year revenue series, compare it with the average yearly growth rate, catch the off-by-one period count and convert an annual rate to monthly.

9 Sept 2026Read guide

The article’s valuation bridge adds debt, preferred stock and minority interest to equity value, then subtracts non-operating assets to reach enterprise value.

Modelling9 min read

Enterprise value vs equity value: build the valuation bridge

Work out what each measure values, classify debt, cash and other claims, and bridge between enterprise value and a per-share equity value with checked answers.

9 Sept 2026Read guide

A text-stored amount of 12,400 is converted to a numeric amount while the account identifier 004120 retains its leading zeros.

Excel7 min read

Convert text to numbers in Excel without damaging identifiers

Diagnose a total that silently ignores text-stored amounts, convert the amount column with VALUE or Paste Special, and keep leading-zero account codes intact.

9 Sept 2026Read guide

NPV cash-flow timeline with a 12,000 outflow at time zero followed by 4,000, 5,500 and 6,500 inflows; the initial outflow sits outside Excel’s NPV function.

Excel7 min read

NPV in Excel: place the initial investment in the right period

Calculate NPV in Excel from a small project schedule, see why the time-zero payment belongs outside the NPV function, and compare periodic NPV with dated XNPV.

9 Sept 2026Read guide

Three equal loan payments are split into falling interest and rising principal, showing the amortisation of the article’s 200,000 loan at 6 percent.

Excel8 min read

PMT in Excel: calculate and check a loan payment

Calculate a loan payment with Excel's PMT function, keep the sign and rate-period conventions straight, and reconcile every payment into interest and principal.

9 Sept 2026Read guide

Retained earnings roll-forward from the article: opening 120 plus profit 48 less dividends 18 gives closing retained earnings of 150.

Modelling7 min read

Retained earnings formula: reconcile profit, dividends and the balance sheet

Build a two-year retained earnings roll-forward with a profit year and a loss year, catch a dividend sign error and reconcile the result to balance-sheet equity.

9 Sept 2026Read guide

A filtering diagram shows SUMIF selecting by entity alone and SUMIFS intersecting entity and paid status before summing amounts.

Excel8 min read

SUMIF vs SUMIFS: build a checked finance report

Compare SUMIF and SUMIFS on a small invoice ledger: entity and status totals, January date boundaries, silent argument-order zeros and a reconciliation check.

9 Sept 2026Read guide

VLOOKUP selects an identifier from the first column and returns a fee to its right, with FALSE enforcing an exact match.

Excel7 min read

VLOOKUP practice: three finance exercises with worked answers

Practise VLOOKUP on a fictional fee ledger: exact matching, a copied formula that breaks and a missing client — with worked answers and checks.

9 Sept 2026Read guide

Three working-capital balances are driven by DSO, DIO and DPO; receivables plus inventory less payables form operating working capital.

Modelling8 min read

Working capital schedule: forecast receivables, inventory and payables

Build a three-year operating working capital schedule from DSO, DIO and DPO drivers, check the cash-flow sign of each change and catch a payables forecast on the wrong base.

9 Sept 2026Read guide

Parallel lookup routes use XLOOKUP or MATCH followed by INDEX to retrieve the same budget amount.

Excel7 min read

XLOOKUP vs INDEX MATCH: choose and check your budget lookup

Compare XLOOKUP and INDEX MATCH with the same Excel budget example. Check exact matches, missing IDs, two-way lookups and workbook compatibility.

8 Sept 2026Read guide

A finance workflow connects a source ledger, SUMIFS selection and a reconciled budget-versus-actual report.

Excel7 min read

Excel for finance: learn the skills by building a budget report

Learn Excel for finance through a practical skills sequence and a checked budget report. Use SUMIFS, copied references, variance analysis and source reconciliation.

8 Sept 2026Read guide

Trading-comps table with Alder at 7 times, Birch at 8 times, Cedar at 9 times and a loss-making peer marked not meaningful.

Modelling7 min read

Comparable company analysis: build a peer set and valuation range

Build a trading-comps example in Excel: select peers, calculate EV/EBITDA, handle a loss-making company and bridge enterprise value to equity value with checked answers.

8 Sept 2026Read guide

Five future cash flows and a terminal value are discounted back to present value in a DCF model.

Modelling8 min read

DCF model example: build cash flow, terminal value and equity value

Build a five-year DCF model in Excel with checked formulas, a terminal-value timing fix and a sensitivity table. Follow the bridge from enterprise to equity value.

8 Sept 2026Read guide

The article’s broken balance sheet has assets of 240 and liabilities plus equity of 215; the difference is the omitted 25 cash equipment purchase.

Modelling5 min read

Balance sheet not balancing? Follow the cash before changing a number

Find a missing cash-flow entry in a worked financial model. Reconcile cash, debt and equity, then test whether your correction fixes the cause.

8 Sept 2026Read guide

Debt schedule from the article: opening principal 100, borrowing 40 and repayment 20 produce 120; closing debt then falls to 90 and zero.

Modelling5 min read

Build a debt schedule: connect repayments, interest and closing debt

Build a three-year debt schedule with borrowing, capped principal repayments and interest. Check the cash-flow links and see why payment timing matters.

8 Sept 2026Read guide

Price-and-volume sensitivity grid from the article with a centre profit of 5,000 at price 12 and volume 1,000.

Excel5 min read

Sensitivity analysis in Excel: build a grid you can check

Build a price-and-volume sensitivity grid with copied formulas, check all nine answers, and compare the setup with Excel's native two-variable Data Table.

8 Sept 2026Read guide

The absolute reference $B$3 stays fixed while a revenue formula copies from D7 to E7 to F7.

Excel4 min read

Absolute references in Excel: make every copied formula count

Learn when to use absolute, relative and mixed references, then follow a finance example where one missing dollar sign changes the result.

8 Sept 2026Read guide

XLOOKUP links an exact identifier in a search range to the corresponding result in a return range, with a separate missing-record path.

Excel4 min read

XLOOKUP practice: find the right value, then handle the missing one

Practise an exact-match lookup with a small finance table. Check missing values and repeated records before trusting the answer.

8 Sept 2026Read guide

Three linked statements: net income flows into cash flow and retained earnings; closing cash links to the balance sheet.

Modelling4 min read

The three-statement model: follow the links before adding complexity

Understand how the income statement, cash flow statement and balance sheet connect, with a small worked example and checks you can repeat.

8 Sept 2026Read guide