“If you can’t describe what you are doing as a process,
you don’t know what you’re doing”
W. Edwards Deming

Inserting your financial model databook, within your financial model

Written by Hedieh Kianyfard

Sometimes financial models are accompanied by another document called “The Databook” or “manual for using the Financial model”. I don’t like to call it a manual, as I agree with Elon Musk in that any product that needs a manual to work is broken!

To me, the purpose of the Databook is to provide the key technical, financing and project assumptions and give an overview of the cash flow projections and the main results of the financial model.

Usually the busy investment officers appreciate this document and use it to quickly extract information from it and use it with the project documents. Although I really like the idea of having a databook, personally I can’t handle updating it every time that I am circulating a different version of the financial model. So, I decided to include the databook within my models and link it to the model input sheet and Dashboard.

I would like to know what you think about the idea of having a databook along with the financial model and what you think are the important topics that should be included in the databook?

You can find a sample Databook sheet in the Excel file. Click here to download.

Below are the content headings of atypical financial model databook.

1. Model overview

1.1. Colour-codes
1.2. Worksheets description
1.3. Macros
1.4. Financial model flow diagram
1.5. Periodicity

2. Project overview

3. Key assumptions

3.1. Project schedule
3.2. Construction cost assumptions
3.3. Financing assumptions
3.4. Operating assumptions

3.4.1. Technical Assumptions
3.4.2. Revenue Assumptions
3.4.3. Operating Cost Assumptions
3.4.4. Major Maintenance Assumptions
3.4.5. Working Capital Assumptions
3.4.6. Tax Assumptions
3.4.7. Dividend policy

4. Output results

4.1. Sources & Uses
4.2. Key Ratios and Returns
4.3. Sensitivity summary results


  1. Vernon Harvey says:

    It would be helpful to also reference key changes which have taken place as the model progresses so that there is a ready reference to where we have beenand nobody tries to re-invent the wheel

    • Dear Vernon, Thanks for your contribution. I think what you are proposing is a great idea for a separate blog post. I have a track changes sheet in my models where I report the main changes from one version to another. But i prefer to use this track changes sheet only at the more advanced stages of the project. At the concept or early appraisal stage, it is almost impossible to keep track of the all the changes. However, once you have most parameters defined and back up by contracts then, you will definitely have to provide a good reason for any changes to the project cost or ratios from one version to another and keeping track of it will save you lot of time going back to different model versions. Thanks again.

  2. This is not something I would use in most models but I can imagine cases where a model is sufficiently complex that the user could use some help navigating and zeroing in on the information they find most relevant at the time.

    • Dear Advansa,
      I think the complexity of a model is a relative term. It all depends on who is the user of the model. If it is someone with limited excel skill, then no matter how easy you make it for them to navigate through the model, they prefer to have a summary report in a document format.

  3. Gerald Strever says:

    Hi Hedieh
    I agree that a Databook is essential and that it’s correct place is in the same workbook as the model. To have it as a separate document is courting disaster. The items included in the Databook section would to some extent depend on the nature of the model, but the items listed by you are all key. I also include the source of the data items i.e. document and/or person.

    • Dear Gerald,
      Thanks! I also think that it is very important to specify the source of your data in the financial model. I usually dedicate a column in the Inputs sheet for Comments/Sources and report the source of the data in front of the assumptions. Sometimes, I include a separate sheet for Raw Data, for example if I am using the EIU or WB database as reference for inflation or exchange rate, then I insert the original table from the source in the raw data sheet. the reason why I am reluctant to report the sources in the databook is that the source of the data might also change and you need to also update in the databook. For me, I want to minimize the amount of time that I have to spend on the databook.

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