Mastering the 3-Statement Financial Operating Model

Build an advanced monthly model that dynamically links the Income Statement, Cash Flow Statement, and Balance Sheet.

Welcome to 3-statement financial modeling! If you’ve taken our Introduction to 3-Statement Modeling course, much of this will feel familiar – think of this course as the next step. While the fundamentals remain the same, here you’ll learn how to build a detailed, monthly operating model designed for actually running a business.

What sets this course apart from others is its unique approach. Unlike courses that are too basic or require you to watch too many hours of videos, this course provides a comprehensive and practical guide to building a robust operating model that can be applied in real-world business scenarios. We've distilled complex concepts into concise, to-the-point videos, paired with a detailed e-guide that allows you to learn at your own pace.

Three-statement modeling is an essential skill for any finance professional. It integrates the income statement, balance sheet, and cash flow statement into a dynamically linked, comprehensive model. This allows you to thoroughly evaluate a company’s financial health and forecast its future profitability, asset position, and cash outlook. As a key decision-making tool, it serves as the foundation for more advanced models, such as discounted cash flow (DCF) and merger models. Ultimately, everything in business and finance ties back to these three financial statements, as they form the bedrock of performance analysis and strategic decision-making.

Whether you're an FP&A leader, a private equity professional, or a student launching a finance career, this course will teach you the skills and knowledge needed to build effective, real-world three-statement models. Happy modeling!

Course Outline:

1. Introduction

2. Getting Started: Building the Model

   • Model Design & Model Layout | Historical Actuals | Inputs & Headcount Planning

3. Build the Operational Schedules

   • Revenues & Costs | Working Capital | Capex & Depreciation | Income Tax

4. Build the Capital Structure Schedules

   • Debt Schedule (including revolver and cash sweep) | Equity Schedule

5. Build the 3 Core Financial Statements

   • Income Statement | Cash Flow Statement | Balance Sheet

6. Bring it Home

   • Circularity | Error Checking | Outputs & Exec Summary

7. Conclusion