tools-only Financial Model Standards
Standards for building financial models in Excel. These apply when the user explicitly requests a financial model, DCF, valuation, or similar structured financial workbook.
Colour Coding Standards
Unless otherwise stated by the user or existing template.
Industry-Standard Colour Conventions
- Blue text (RGB: 0,0,255): Hardcoded inputs, and numbers users will change for scenarios
- Black text (RGB: 0,0,0): ALL formulas and calculations
- Green text (RGB: 0,128,0): Links pulling from other worksheets within same workbook
- Red text (RGB: 255,0,0): External links to other files
- Yellow background (RGB: 255,255,0): Key assumptions needing attention or cells that need to be updated
Number Formatting Standards
Required Format Rules
- Years: Format as text strings (e.g., "2024" not "2,024")
- Currency: Use $#,##0 format; ALWAYS specify units in headers ("Revenue ($mm)")
- Zeros: Use number formatting to make all zeros "-", including percentages (e.g., "$#,##0;($#,##0);-")
- Percentages: Default to 0.0% format (one decimal)
- Multiples: Format as 0.0x for valuation multiples (EV/EBITDA, P/E)
- Negative numbers: Use parentheses (123) not minus -123
Formula Construction Rules
Assumptions Placement
- Place ALL assumptions (growth rates, margins, multiples, etc.) in separate assumption cells
- Use cell references instead of hardcoded values in formulas
- Example: Use =B5*(1+$B$6) instead of =B5*1.05
Formula Error Prevention
- Verify all cell references are correct
- Check for off-by-one errors in ranges
- Ensure consistent formulas across all projection periods
- Test with edge cases (zero values, negative numbers)
- Verify no unintended circular references
Documentation Requirements for Hardcodes
- Comment or in cells beside (if end of table). Format: "Source: [System/Document], [Date], [Specific Reference], [URL if applicable]"
- Examples:
- "Source: Company 10-K, FY2024, Page 45, Revenue Note, [SEC EDGAR URL]"
- "Source: Company 10-Q, Q2 2025, Exhibit 99.1, [SEC EDGAR URL]"
- "Source: Bloomberg Terminal, 8/15/2025, AAPL US Equity"
- "Source: FactSet, 8/20/2025, Consensus Estimates Screen"