1. CONSULTING TOOLKIT
Narrowing to a Recommendation
Calculating Financial Impact
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2. Present financials in a pyramid structure
PRESENTING FINANCIALS - STRUCTURE
•The Answer first: Summary financials (e.g. Projected cashflows/P&L)
•Key assumptions, with rationale
•Key drivers of these financials (sensitivities)
•Downside risks and upside opportunities
•Financing if a new business venture
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3. Present financials in a pyramid structure
PRESENTING FINANCIALS - STRUCTURE
Summary Financials
Key Assumptions Sensitivities/Drivers Upside/Downside risks
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4. Good charts will bring your financials to life
PRESENTING FINANCIALS - CHARTS
•Put the most important numbers in the lead/message
•Make sure the numbers in your lead are highlighted on the chart
•Use graphs to visualise the numbers
•Only use tables if the numbers are too complicated and NEVER
present a spreadsheet!
•80/20 rule – don’t try to be comprehensive
Details:
•Make sure every axis and number has labels
•Sensible rounding, no spurious accuracy (e.g. $456.38m)
•Use acronyms correctly (e.g. ROCE%, IRR%, NPV)
•Check numbers are2007-2012 IES Developmentacross Reserved
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5. In delivery, show you are on top of your numbers
PRESENTING FINANCIALS – DELIVERY AND Q&A
PRESENTATION
• Demonstrate your mastery
• Tell the business story when you explain the numbers
• Bring numbers to life, don’t just read from the slide
Q&A
• Know your critical assumptions you must defend at all costs, and
which can be flexible
• One person should be the “numbers person” for Q&A, who knows
the numbers cold
• Full detail in hyperlinked IES Development Ltd. All Rights Reserved
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6. You will need to be fluent with financial terminology
CLASS EXERCISE
A business is looking at investing in a new project. They estimate the
after-tax cashflows as the following:
Year 0 -$50m
Year 1 +$11.0m
Year 2 +$24.2m
Year 3 +$53m
Calculate
1) NPV($m) (WACC=10%)
2) ROI%
3) IRR%
4) Cash payback (months)
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7. There are 4 key financial numbers you should focus on
CUMULATIVE CASHFLOW
HK$m
IRR%
40
NPV
30
4) TIME to payback cash
20
10
3) BURN 0
RATE Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q3 Q4
-10
2) FUNDING
-20
NEED
-30
1) TIME to
-40
cashflow breakeven
YYDDMM Syndicate Case_name
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