Why Most Financial Models Fail for FP&A Pros to Build Business-Aligned Models with Maria Zlobina

I think that financial modeling is not about just crunching numbers, right? It's not about creating a spreadsheet, it's about creating a story. It's about understanding.

Tell me about that worst financial model you've seen in your career.

The worst financial model I think. Maria's Labina is a seasoned finance professional with a global background, having held roles in the US, Australia and Russia across big four, audit, FP&A and commercial finance. As an AFM certified financial modeler, she specializes in transforming complex data into strategic insights. Everybody has different ways to set up a model to build the logic behind it. I find this in the beginning, the most challenging part.

We see a lot of models fail. Most of them seem to have problems. It's why I think everybody hates inheriting somebody else's model.

Financial modeling is not just open ended answer right or question. It's just a model and it's supposed to provide you information or range of answers we'll accept.

Ever die?

I think that's an absolute. No. AI is really big right now. I think AI technology is great for creating new tools.

What's your favorite Excel shortcut?

Control C, Control V?

What's a tip or trick you've learned in Excel?

It depends on the task, but.

Financial Modelers Corner is the world's premier modeling podcast. It is brought to you by Financial Modeling Institute, the world's leading financial modeling accreditation organization. Welcome to Financial Modeler's Corner. I am your host, Paul Barnhurst, AKA the FP and A guy. This is a podcast where we talk all about the art and science of financial modeling with distinguished financial modelers from around the globe. The Financial Modelers Corner podcast is brought to you by the Financial Modeling Institute. FMI offers the most respected accreditations in financial modeling. And that's why I completed the Advanced Financial Modeler this week. I'm thrilled to welcome our guest to the show, Maria Zelina. Welcome to the show.

Thank you Paul. Great to be here.

Very excited to have you. So Maria is joining us from Sydney today, right?

Yes, that's true. Australia.

So she's joining us bright and early on this episode and to give a little bit of Maria's background and then we'll jump into some of her questions. So Maria is a finance professional with over a decade of experience across Big 4 Audit, FP and a commercial and business partnering roles. She has worked and lived in three countries, us, Australia, Russia, bringing a global perspective and analytical skills to every project, helping businesses and executives support their decision making and see stories behind the numbers. With her curiosity and love of continuous learning. She recently earned her advanced Financial Modeler certification and is on the path to become a chartered Financial Modeler. Beyond that, she's passionate about traveling, having explored 30 plus countries and believes that diverse experience feel better insights in her professional life. Love it. So, 30 plus countries. Do you have a favorite country?

Uh, everybody asks and I have to disappoint. You know, I do not have a favorite. It's just so hard to pick. So I don't think you'll get one from me.

But do you have a favorite on the list that you'd like to go to that you haven't gone to yet? You have a next one on your bucket list?

Next one? Well, I would like to explore more South America. Lots of like Colombia, Argentina. But I, I think one country that was really a surprise for myself was Indonesia, more specifically Bali. And I know in the, in America is just. People feel like it's some dream destination, right. And I thought it was like really overrated actually. I actually didn't know anything about it, to be honest. So. But once I get there, I probably spent about eight months there combined between five or six trips. So that was definitely one of the places that, you know, was a big surprise and really loved it there. So I guess I'll distinguish that one this condition.

All right, we'll go with Bali. We're going to jump into this first question I give every guest. Tell me about that worst financial model you've had to work on or that you've seen in your career.

You know, the worst financial model. You know, I'll, I, I think I'll respond in a way that probably you don't expect. I'll say it's the one that was built not by me and not because I'm so amazing and great. No, I'm more honest than that. I think it's just because the. Everybody has different ways to set up a model, to think through that.

Right.

To build the logic behind it. And so really I think the first thing that kind of catches me off guard is to see if I'm inheriting somebody's model, is that I have to figure out the way how the person was thinking, the logic, the train of thought. I find this in the beginning, the most challenging part, right. And of course there are some things that can be difficult for everybody to inherit. For example, it's like hard coding and very like sporadic way to set it up and things like that. So I can't remember like the worst, worst one, but you know, little bits of pieces in Different. You know, in my experience, the ones that I've seen there definitely some things that could make it like really hard to work with. But yeah, generally inheriting somebody else's work is more challenging for me.

Yeah, that can always be a challenge. Is a joke I like to tell is what do you call a broken spreadsheet?

Oh my God.

The new employee's problem.

Wow.

Right. Because that's usually what you're inheriting is it's broken in some way or another.

Yeah, it's always different, you know, whether it's broken or not. But yeah, it's definitely different and challenging.

That. That is for sure. Even if it works great, you still have to figure out someone's logic and thinking and layout. Is there a pet peeve when you inherit someone else's model? Like one thing that just drives you crazy?

Yeah. Hard coding is probably high on the top. It's just because it's a dead number.

Right.

So when you're modeling, and I'm sure you can relate to that, one of the critical features of the model, of a good financial model is being dynamic.

Right.

And so hard coded stuff, it means that it's dead, so you can't see what was there and you don't see where it's coming from. So really that's a kind of dead end when you start modeling is you don't understand the value behind it. So definitely it's one of the big ones there. For me, hard coding, I think it's.

Probably pretty high on everybody's list, right. Those hard coded, especially when they're, when they're all over the model and in places you'd never expect them, you're like, really? You stuck that number there like just at the end of formulas things.

Exactly.

So I know you're a big advocate of learning. You know, kind of mentioned that in your bio. You've completed your cpa, you did the FMVA from cfi. You know, you're doing the, you did the AFM from fmi and I know you're looking at doing the cfm. So I'm curious, you know, what motivates you to keep learning and to complete these different programs? What is it about learning that you love so much?

You know, it's just, I guess the process. We don't know what we don't know. That's one thing.

Right.

And just for me it's, I guess really number of different reasons and they're not all professional related. Yes, of course. I always want to learn what I don't know learn best. Practices learn how other people are doing the work because we all have our own things that we like and prefer. But I think for me it's more of a, call it lifestyle or something. It's just hungry for more in general and it comes to, to you know, traveling like you mentioned earlier is just absorbing information. Absorbing and it's not like just hard code information like books and courses.

Right.

So I like to learn from the experiences, from life in general, from day to day life. I try to also keep it multifunctional and it's not about just professional, like finance, let's say. It's also learning Spanish. I got my coaching certification as well, which like oh it's sports or some other hobby. So it's really, you know, goes I guess across my different, different areas of life and just this sense that I'm learning something new, it keeps my brain alive. It keeps, I guess I don't know me as a more interesting person for conversation. So it just, I don't know, it, it feels great. I guess the short answer it feels great. So that's why, that's why I do it.

Love it. How, how's the Spanish coming? You said you're learning Spanish?

Yeah, it's, it's actually been great. And since I learned English, it's not my native lang, right. So I've been able to use some things that I'm doing differently basically while I'm learning Spanish. So I just went straight to Costa Rica in my. For I guess after like three months of learning some basics, went to Costa Rica for two weeks. It was six hours a day boot camp. So that was great. I guess, you know, it's really jump started my process there. So I went to, I lived in Ecuador, I went to Mexico a couple times and I'm keeping up on a weekly basis as well. So really consistency and passion, I think those are the key pillars to any learning, any progress.

Yeah, I agree. You gotta have some passion. As you start to lose that passion, it becomes really hard to keep going. And consistency, it's like anything. Everybody's like, well how do you become so good at something? Well, I didn't 500,000 hours. And over time it gets easier. One of my favorite quotes kind of along this I've always loved is it says things become easier, not that the nature of the task becomes easier, but our ability to perform the task becomes easier. And that's what to me, what really is practice is it makes our ability to do something easier. It's not that it was hard to start with and it's still probably kind of hard in a sense, but our ability becomes better. It's not that that thing itself becomes easier. We've just learned how to do it right.

Yeah. And I love the process of it. You know, the better you practice, the more you do it, the better you get. And for me, again, it's a very satisfying feeling.

Right.

So even like for me, going to a different country and talking not about just ordering your food, but having a conversation, you know, in more sophisticated topics, I think it just feels great and, you know, just you naturally keep wanting more of it, so you just continue.

Love it. So I know you started your career in big four accounting, and from what I saw, I was, you know, looking online and I noticed it came after a chat with your big brother. So, you know, how did that conversation help shape your life? You've mentioned how it kind of shaped where you're at today. You want to tell a little bit of that story?

Yeah, of course. Yeah. That was actually came out of nowhere. Yeah. My big brother. Yeah. I like to think of him sometimes this ways. You know, it doesn't matter how old we are or how young we are, you know, if you have your big brother, big sister, it's always. They're always there. Even though we are in different continents still, you know, the bond is there. So he actually worked for Big four, I guess, before me. So he had a great experience of in knowing what it is and what it can provide, the value, the opportunities. And so I definitely was interested in something like that, but I thought I missed the submission point, but somehow it just happened that, you know, he's like, do it today. That's like the last day, basically. So I just jumped on it and, you know, I never thought it's gonna turn out to be like that because really Big four, as much as it's a great experience, I think it's a resume builder for any finance person.

Right.

But for me, it also was a window into a different life, as I like to say, because that was ultimately my way, how I moved to the States and, you know, just have had an amazing life there for 10 something years. So it's really, you know, highlights the point where you don't know what conversation is going to be such a massive step and it's going to be a game changer into for the rest of your life.

Right.

So really there's surprises of life, surprises of like just casual chats with different people. They sometimes can be really a turning point and it's fun to look back to it. And I definitely do remember that conversation and which out of all the conversations him and I had over a lifetime, but definitely do remember that one for which I'm forever grateful.

No, that's awesome. Thank you for sharing. And it's amazing how, you know, some conversations stand out more than others and they can make such a difference in our life and sounds like, you know, Big four was a great place to start your career and gain some really good experience.

Yeah, absolutely. I mean it was challenging and I think people who's been, who've been through that experience can definitely confirm and doesn't matter what country you're in and in what, you know, audit or consultancy or any other areas professional area. I think it's definitely character building and experience building. Exercise. Yes, for sure. Definitely grateful. Across Russia, across my American colleagues and friends there. So.

Great. Yeah. No, so I'm curious, I know you recently completed the Advanced Financial Modeler from fmi. What motivated you to take the program? What was the kind of impetus for taking the afm?

Yeah, I came across that very. I guess I wasn't searching for it specifically because I just didn't know that existed that back to my point.

Right.

We don't know what we don't know. And so somebody posted on LinkedIn this very helpful post actually about all the finance related certifications and so I thought like, well, you know, I had my CPA and there was ACCA analyst that I actually did, you know, most of that back in my time in Russia. So like, well, you know, I want more something finance related on top of what I already had before with CFI Financial modeling and valuation. So I found this one and really interested me with the agenda. So I actually initially wanted to do CFM straight away, but there is a process you need to do Advanced Modeler first before chartered. And I thought it was a really good foundation to refresh, you know and I'm sure I would learn something else. So I really jumped on it. You know, that's pretty much how I do it. I find something interesting and jump on it without waiting for too long and really it's probably exceeded my expectations in some ways that I didn't expect. Uh, so definitely yeah. Can recommend anyone who is looking to Excel or who's looking to polish financial modeling skills and just learn some best practices. So grateful for that experience as well. I think it's gonna help me further as well and I'm gonna definitely use some tips from that course.

Got it. No, that's great. I know I learned a few tips from it as well. And it was helpful. It was definitely. I felt more comfortable doing a three statement model, which isn't my area of expertise, you know. And so. So are you doing the Chartered Financial Modeler then? You planning on doing that one as well?

Yeah, absolutely. That. I'm actually really, really excited about it. I know it's only once a year. That's why I'm definitely not waiting for the next year to come. Definitely. No, no patience for that. And why not, you know, do it this time around? So excited about some modules, excited to. About the depth of that course and also the variety of the subjects.

Right.

As you mentioned, they are famous about three standard models, which I think is A. And I'm actually looking forward to some modules like M&As and evaluation and some. Some more sophisticated topics. I think it's really going to help me with my current role and you know, just again, there is no limit for knowing more and learning more. So October, I think October 25th definitely is the day on my calendar.

Yeah, I, I need to put the date on my calendar. I recently signed up for CFM and I'm hoping to do it this year. I'm not quite ready to commit yet, so we'll see. But I have started reviewing it a little bit.

Once you start, you get in and you're like, okay, while wait and why wait and you know, I think we're going to be in the same cohort.

But I hear you.

No, I was just gonna say you can study together and to be in a study group and, you know, be accountability partners for each other, I definitely.

Need, I need one of those. I have one person I'm talking to another. So yeah, we'll definitely have to chat on that. Accountability is always good. It's the only way I get stuff done some days.

Well, let's do it then.

All right, sounds good. So when it comes to modeling, just in general, there's something that we, we see is right. A lot of models fail. Most of them seem to have problems. It's why I think everybody hates inheriting somebody else's model. I mean, I've built plenty myself with problems. So one thing you mentioned is you think one of the reasons a lot of them fail is because people truly do not understand kind of the purpose or goal of a project. Why do you think that is? Why do you think so many people struggle with really understanding what we're trying to accomplish with the model? Well, my background is in FP&A. I am also passionate about financial modeling. Like many Financial modelers. I was self taught. Then I discovered the Financial Modeling Institute, the organization that offers the advanced Financial Modeler program. I am a proud holder of the afm. Preparing for the AFM exam made me a better modeler. If you want to improve your modeling skills, I recommend the AFM program. Podcast listeners save 15% on the AFM program. Just use code podcast.

You know, I think when you start from scratch, especially on a project that you've never done, right? So it's really easy to get in the way of just building something and move on, right? Just to put some numbers together, you know, they will do some formulas, they'll produce something and that's it. And I think that better way to do it is really start with a goal and understanding what the, you know, the stakeholders for who you're building the model is really trying to achieve. Sometimes I think even they don't fully understand what they're trying to get out of the model, right? So I think it's really in that collaboration and being curious and understanding more, more than just on the surface level what is the goal, right? What questions this model is trying to answer? I think that's definitely the first step, right? And then you kind of can start and shape up the model, how you want to set it up, how, how it needs to look like and how it needs to work. So because I think if, if, if there is no understand, if there is no right understanding or lack of understanding of what it needs to do, everything else kind of becomes, you know, not as useful because like in some of my experiences before, you know, when I've done it all and I've seen it some other ones that, you know, it lacks the like model needs to be dynamic, right? So if it's not dynamic then it becomes obsolete in my opinion because it's not just black and white. It's not like the person comes to you and asks you to build a model and it's going to be the way it is, right? So there's just going to be multiple changes, multiple iterations, what ifs. So if the model cannot sustain all these changes, this, that's just not going to be as useful. So I think really it's critical to understand all the inputs, all the variables, all the things that can change the output and towards, you know, the answering the question. So I think that's definitely important one that's getting, getting misunderstood or under underestimated.

Yeah, I, I, I agree with that. I think sometimes it's underestimated. You think, hey, this is just a Math exercise. All I got to do is build it. And there's a level of understanding. How do you, when you're working with the client, you know, kind of for that first time, are there specific questions or ways you like to go through to make sure you really understand what they need? Because like you said, sometimes a client doesn't even know they have an idea what they want. But as you start talking to them, they become a parent. Okay. What they want and what they need are two different things.

Right.

So how do you kind of make sure you have a good understanding? Are there specific questions or a process you like to go through?

I think it's all individual.

Right.

It's just trying to put myself into the shoes of that person is trying to make a decision and trying to look a little bit wider of what other factors that can impact the area, what we are modeling and so how it's going to be used, who are the people that are going to be impacted, what other variables that we need to take into account. So sometimes when you start going through that, some people, why are you being so noisy or why are you being so difficult? You know, but in the end of the day, it's actually, you know, working for, for that.

Right.

Working for the result, for the process. Because a lot of the times people who give you this, you know, task, they have a lot more in their head. So they think that something is obvious or, you know, they just kind of, it's, it's running in the background in their, of their mind, but it's not being explicit.

Right.

So the more you ask, the more becomes transparent that, and obvious that a lot more need to be taken into account. So it's just, I don't know, simple conversations and trying to be logic and curious and expand the depth of the model. I guess you can always take things out, but, you know, the, the broader approach you, you, you get, you take during the process of scoping, I think is going to be beneficial.

Yeah, no, I, I agree. I think, you know, the more time you, you spend up front, almost always, the better model you end with. End with. I know the times where I just start working in Excel, you often go, okay, now I need to rebuild that because I didn't know what I was doing right after you have some conversations, really understand it. So I'm a big believer that understanding upfront will save you time in the long run. You may not get into the model for, you know, another day or later than you planned, but you'll have a better idea of how to lay it out, how to structure it, how to think about things. And to me it's, it's worth it.

Absolutely. And I think the more you work on it, you always go back and ask. So it's just, you know, sometimes it's helpful to start with something and then see where it takes you, what other information you're missing. So it's always a process.

Right.

But I think it's always good to keep a reminder that, you know, what else that I'm missing, what else is critical to take into account.

Agreed. It's always, always good to be able to look at it and think the other things I'm missing because. Right. Bad assumptions. It doesn't matter how well designed a model is. If you're missing key assumptions or have bad assumptions, you're not going to get a good output.

Exactly.

And so, you know, when we talk about modeling, you know, one of the things we're often trying to answer is what if type questions. You know, a lot of times, scenario sensitivity, you had mentioned you really love answering what if questions. What is it you like about that? What is it specifically about? Kind of, you know, that what if type question that we're offering. Often answering and modeling excites you.

You know, it's just the matter of, I'll put it that way. So financial modeling, it's not just, you know, it's an open ended answer.

Right.

Or question. So it's, it's just a model and it's supposed to provide you information or like a range of answers, I guess, given like a set of criteria.

Right.

So, and this, what if. I don't think I've met any executive in, in my experience that asked for a model, they got it and they were like satisfied with it.

Right.

There's always like, it's in their nature, it's in people's nature to ask questions. So especially when they get a start and then they see all these variables and then how things work and flow and it's, it just naturally happens. Like what if, you know, we increase prices not by X but by y percent? What if we sell not this volume but the other volume? So really it's being dynamic. That's, I think what the, you know, one of the biggest advantages of having financial modeling is, is that it's dynamic. You don't get just one, one question, one answer. It gives you the whole range and provides sens analysis as well.

Right.

Which is also beneficial for a lot of the cases. So it's looking at the broader picture and helping decision makers to, to get to, to really make the best choice.

Right?

So it's, it's the art, I guess, or combination the art and the science, but definitely a creative process. So what if is a very powerful question in finance.

I agree. And I like how you said, you know, helping our clients get the make the best decision, right? There's lots of decisions they can make, some are good, some are better. But how can we really help guide and make sure they're making the best decision they can with the.

Definitely a creative process. So what if is a very powerful question in finance.

I agree. And I like how you said, you know, helping our clients get the make the best decision, right? There's lots of decisions they can make. Some are good, some are better. But how can we really help guide and make sure they're making the best decision they can with the information they have? It's never going to be perfect.

I think it's been really transparent, right? So transparent on the inputs that, okay, you know, these are, let's say 10 inputs. But we know that in reality it's going to be so much more, right? It's just some we are modeling some going to happen or we don't even know what's going to happen, you know, what other ones can come up. So we just need to make sure we nail the most critical ones in any given case and look through the outputs and really talk through that. And I think financial modeler, which it's not a topic that I'm kind of passionate about, I think that financial modeling, FPA in general, people by some companies or people being really under, underestimated, undervalued. So it's not about just crunching numbers, right? It's not about creating a spreadsheet, it's about creating a story. It's about understanding, right? So it's being really partnering with a stakeholder of the model. It's working together to make sure that we translate the business case, business situation into the numbers to again provide back the best insight for the, for the answers. So it's just, you know, working together and we never know what's the best answer, what's the right answer. But we can do our best to, in the given circumstances, to take the best one.

I like you said, it's really about working with, with the partner and figuring it out together and having those conversations because that, that's really where, you know, the learning takes place. It's not even so much the output because the reality in every model we've built, the output is wrong, some less wrong than Others. But, you know, as I heard George Box once say, all models are wrong, some are useful. Or as a friend of mine said that, I laughed. He goes, if you work in biopharmaceuticals, it's just all models are wrong. There's no, some are useful. And I kind of laugh because they're so hard to build. So I think that process and the thinking and understanding and the assumptions and trying to help guide the decision making to say, hey, is this a plausible solution? Can we get in this range? Does it make sense? Is really what the model's there for? Because like I said, we're never right. The sense of I haven't had a single forecast I've done come out to the dollar. I don't know about you, but I never have.

That's what I was going to say, that the model that is always wrong is the budget, day one. It's wrong.

Right.

And I mean, so in some companies, there's so much effort going to budget and the process, which I think it's great to, you know, obviously budget is a great tool, but it just needs to be a balance between, you know, the cost and value it provides.

Right.

So it has to be directionally right. It has to answer the questions and provide the insights, but it's never going to be right. So it's just again, the matter of the how it's being used and if everybody is aware of the limitations and the, the proper use of the tool.

Yes, I fully agree with you. Right. Budgets are never. They're wrong on the day they're finished. They're wrong the entire time. So I think sometimes, why are we spending six months on it? It's like, let's focus on the important things, the key elements, the plan, and then let's really spend time on making sure we can get as close as we can to achieving those goals, making sure the business is in the right direction. Versus, should this be 10,000 or 12,000? It doesn't matter.

Doesn't matter. It's all the same. Yeah, Yeah. I think the magic, a lot of magic also goes into then explaining those variances.

Right.

So if we're holding on to this budget as the bible and source of truth, you know, and of course, as we all know that it's wrong, then it's 12 months of explaining the variances. And again, you know, it can be useful, it can be helpful. It just depends on, you know, to what extent you really follow every. Every of those numbers.

Yeah, it's finding that right balance. Like you said, I Mean budgets, planning. You have to do some kind of planning, what, rolling, forecast, whatever portfolio. I mean, there is. Beyond budgeting, you don't have to do a budget per se, but you got to plan. You got to have some numbers, targets to go toward. It's just finding the right balance between being rigid, which I'm sure you've seen, we've all seen, and being flexible. Because at the end of the day, it's just a guide. The goal is to really. To achieve your strategic objectives, not to hit an exact number.

Yeah. And that's what I'm grateful for, again, to audit for this concept of materiality. You know, there is this difference between accounting and audit.

Right.

And so what was great about being an auditor on being on that side of the. Of the fence, I guess, is there is a materiality, context, concept. You know, it doesn't have to be dollar for dollar or cent for cent. So it's just, you know, materially correct. That's all we need, right?

Yeah. That's one thing I like about fpa. I didn't come from audit or an accounting background is, hey, you know, it's about being directionally correct. Not an exact number. But I know what you're talking about. When people think it has to tie out to the penny, no balance sheet. I get it. This is a little different. So I want to shift gears a little bit. We've talked about modeling. Now we're going to jump into some kind of fun questions I ask every guest. And the first one, what's your favorite Excel shortcut?

None. I don't use any. Well, I actually, I use any.

Wow.

It's just like Ctrl C Control V. You know, I'm not a big. I'm not a big fan. I guess I'm really good with my mouse. So.

So no, I. I was that way for a long time. I've started to use shortcuts a lot more over the years. Totally get it. Okay, what's a. What's a tip or trick you've learned in Excel that most people don't know or something you think would be helpful?

Gosh, it depends on the task. But my God, that's, like, caught me off guard. I can't say that nobody knows. It just really, I don't know. Like, let's put it that way. Simple formula of xlookup saves me a lot of time. Can. Can we go with that one?

We can. Xlookup works.

Yes.

So what's the most unique thing you've either created or seen someone create? Like a Model for using Excel, kind of for personal life or something fun that you've seen be done in Excel.

Yeah. And I thought, you know, my first thing was like, you know what I. For fun, for personal life, I don't think I use Excel, but actually like I had to use Excel just a bit ago when I was coming to Australia and then I had to list all my travels for the past 10 years to the city, to the country, to the date. So that was a nightmare for me considering that I've been to so many countries over the last even two years, not even taking like 10 years. So that was like a huge thing. And I had to do all this exercise, right. But then I thought like, well, you know what, since I have already all this data in Excel, I might as well just calculate how many times I probably like, you know, went around the world and you know, how many months, months or maybe years I spent in the air in my airplanes and how many flights I took, you know, in the given in a given month. So that was kind of interesting, you know, in my digital nomad days because I had like, I don't know, in some year I had 27 flights in one year. And so that was kind of interesting to calculate, you know, on a.

How many miles are you?

I didn't get to that part. I thought it would be cool to see. But I mean, yeah, that's a lot of work. It is a lot of work, yes. I mean, I'm sure it would be fun to kind of see what it is, but yeah, again I would imagine.

It'S a lot if you had 27 flights in one year, that. That's a lot of miles.

Yeah.

Bad financial models can lead to bad decisions or worse. So how do you minimize the risk of a bad model? You make sure the models you build are great. Financial Modeling Institute developed the Advanced Financial Modeler Accreditation Program to help modelers like you. The AFM program offers a step by step approach to building world class financial models. The program ensures that you know the best practices in model design and structure and will help you brush up on your Excel and accounting skills too. Be the one on your team to build great models if you want to impress your boss and your clients. Get AFM accredited podcast listeners save 15% on the AFM program. Just use code podcast@fminstitute.com slash podcast. All right, so now we're going to move on to what I call the rapid fire section. So I'm going to tell you how this works. Have about 1012 questions and you Pick one side or the other so you can't say it depends. And then at the end you can elaborate on one or two because you could say it depends for all of them. But that doesn't make for a very interesting show. So you ready?

Yes. Let's do it.

All right. Circular references in models, yes or no?

No.

Vba, yes or no?

No.

Do you prefer horizontal, Lots of sheets for your schedules, or vertical, kind of putting it all on one page?

Both.

Ah, one of those. All right, we'll give you both hands. All right. Dynamic arrays. Do you think they should be used in. In models? Yes or no?

Let's put it now. Keep it simple.

All right. External workbook links, yes or no?

No. Absolute no. It's one of those pet peeves in addition to hard coding.

I had a guest on that one time said they found, I think it was 47 deep links. So you would have to open 47 files to refresh everything in a model.

Oh my God.

Yeah. Imagine picking up that model and have to untangle it. It's when you just start over.

I would just delete it. The model.

I don't know. I'm glad I haven't had to deal that one. Named ranges in models. Yes or no?

No.

All right. When you build your models, do you follow any of the formal standards out there? There's like Fast and Smart and some of these others like standard boards.

I do not.

Okay. And then here's kind of just get your opinion on these. Do you think financial modelers should learn how to use Python in Excel?

No.

How about Power Query?

Yeah.

How about Power bi?

Yes. Love that one.

We got a no. Yes. Yes. Will Excel ever die?

No.

I always like to see what people have to say to now.

Yeah, I think that's an absolute no. With so many BI tools and everything, I think Excel is there to stay.

Do you think AI will build the models for us now? Future?

No. I mean maybe they will build, but it's not going to be a good one without the human input. So I guess it depends.

Yeah, and that's, I think that's what a lot of people say is yes, they could do the technical, like probably build the model, but there's going to have to be human judgment and input.

I would agree with absolutely.

All right. Do you believe financial models are the number one corporate decision making tool?

I can't say number one, but it's definitely in the top three I should say, if used properly.

Right.

So yeah, considering what we're talking about, definitely. If used correctly, if Everybody understands all the magic that goes in there. Definitely can be one of those critical ones.

What are the other two you mentioned? It's probably top three. What, what would you put above it?

Well, for decision making, lots are going on, right. When people are trying to make a decision. So it's modeling again, it depends what. How much of the information and relevant information is included into the model. Because like if you talk about finance, right, it's numbers. But also there is a market intel, there is like macro micro things. So it just, it depends if it's going to make it in the model or there's always this qualitative, not just quantitative.

Right.

The factors that are going on. So it's. It's one of. It's one of, but not the only one.

It's one of. But it's going to vary. Yeah, that makes sense. I get what you're saying there. And then what's your lookup function of choice? Are you xlookup Vlookup index match. Which one?

Xlookup I think Vlookup and hlookup is old age now. Xlookup I think is definitely the one to go with for me. Definitely saves tons of time and effort.

Yeah, I'm a big. I like xlookup. I'm a fan of it, so I can appreciate that. Any of those you want to elaborate on your answers or are there any where you're like, I want to add a little more context.

You know, AI is really big right now.

Right.

So you mentioned if you asked if AI is going to build models for us, I think back to, I guess, yeah, how. What I said, it's how we use it.

Right.

Because I think AI technology is great for creating new tools. Like, you know, Excel keeps up with new formulas and new features and I think it's really critical to stay up to date. Yes, maybe like sometimes people say old dogs, new tricks and it's hard to keep up. Especially people with so much experience in the field. They may be like, okay, you know, I've done it for so many years, you know, I know it all. But the truth is that company software always comes up with better solutions with more efficient tools and instruments we can use. And I think it's for our own sake, it's best to keep up with that.

Right.

But it's just technical thing and like I mentioned before, modeling is like a science and the art. So it's a combination of technical and the meaning behind that. So I think we can utilize those as much as possible. But definitely have our own input and creativity and human mind that AI doesn't have. So as much as I am actually, like, I would like to get more into that and keep being more updated on all those possibilities. I know in Excel they have. What's it called? Copilot.

Right?

Yeah. So sometimes it's a question that I'm faster to find the answer than I'm going to be typing the request for.

Right.

But sometimes it can be really useful. So it's just, I think, the matter of practice and actually utilizing and find the best case for. For the tool.

Right.

Because you're not going to be, you know, doing something simple with a pivot table. You just don't need it.

Right.

It's just, you know, keeping the balance and making sure that you're using the appropriate technology tools, formulas for what you need.

Yeah, agree. It's always a matter of finding out where it makes the most sense. There are times when it can be fabulous. There's times when you can do it on your own and kind of everything in between. And it will definitely be interesting to watch how it develops and grows. I mean, it's pretty amazing what it will do. And I think the. The logical stuff it will be able to build, but there always be that human judgment and human element that's needed in whatever, you know, AI is doing. So be interesting to watch how it develops, for sure.

Yeah. I mean, it can't keep up, like I said, but I mean, we can always try, right? And.

Yeah, well, it's just happening so fast that nobody can keep up. I mean, I have a podcast where I talk all about AI and technology, and my partner's like, did you see this? I'm like, no. Did you see that? No. I'm like, okay, it just changed so much.

Yeah, there's just so much. And I think having this, you know, like, short. How to. How do you say it? Like when somebody does a review or overview, okay, this is a great tool and this is how to use it. I think it's, you know, great educational thing. Or when you take course like afm, CFM, or any other in AI, when you're ready, can digest information being put in a nice way that's easy to learn and implement. You know, I think actually like, one of those, you know, questions that I could elaborate is all these, like, Excel shortcuts or any, you know, tips and tricks, they're the best when they're being utilized.

Right.

Because you can know so much, but the truth is, like, how are you using it and how beneficial it is? So that's the question.

Agree. I mean, you could have a ton of knowledge in Excel, but if you're not using any of it and you're not using it to be better, then is it really valuable knowledge? At the end of the day, it's. The idea is especially modeling Excel, certain things, it's really about how does it help you be more productive?

Yeah. Efficient. Productive, yes. That's actually like my probably number one word that, you know, I'm trying to like. It describes how I function a lot of the times and personal and professional life is the efficiency. You know, I'm having a hard time with inefficiencies and idle time and effort, so sometimes drives myself crazy as well. I'm sure other people too.

Yeah, I'm sure. Yeah. All of us have those moments when the inefficiency drives us crazy. I've. I've definitely been there. So if you could, you know, as we wrap up here, we just have two more questions. If you could offer a piece of advice to our audience that you think would help, you know, them become a better financial modeler, what would be the advice you'd give them?

I think staying curious and open to what's out there. Always keep learning. Keep learning in terms of the tools and, you know, the ways, how you can model and how you can, you know, set it up and make it happen, basically. And also they be curious about the context of it, the business side of it.

Right.

The, you know, the situation or scenario that you're trying to model in. I think the combination is going to give the best result. And then, of course, like, you know, take courses, I don't know, get new information, tips and tricks, and the most importantly, apply it, because without application, that's. We already talked about, it's, it's really useful list. So I think, I think those two, probably the. The biggest ones.

And then last question, you know, if someone's listening to the podcast and they want to kind of learn more about you or potentially get in touch, what's the best way for them to do that?

Probably LinkedIn is the best, best way for me.

That's what I figured. That's pretty common. I think everybody uses LinkedIn nowadays, right?

Yeah. Yeah, perfect.

Well, thank you so much for carving out some time today, Maria. I really enjoyed chatting with you and I'm sure our audience will enjoy this as well. So thank you for you. Thank you for coming on the podcast. I appreciate it.

Yeah, thanks, Paul. Thanks for doing it all for all of us. And I'm sure, like your podcast like a. Just a treasure for finance and maybe like somewhere close to finance, because it just, it touches so many different topics. You know, sometimes for the outside, it can sound like nerdy finance podcasts, but actually it's. It's about life, it's about business. And, you know, finance people are fun people to begin with.

Right.

So I love it. Can I get that? I'm going to put that on a billboard. Maria, finance people are fun people.

Yeah. I mean, you can't, you can't be a good finance person if you're not having fun while you're doing it.

Right?

So I think that's so, yeah. Thanks for all you do and thanks for bringing this tons of value and treasure for us, I guess, to learn from. And yeah, thank you for having me. It was great.

Thanks, Maria. Financial Modeler's Corner was brought to you by the Financial Modeling Institute. This year I completed the Advanced Financial Modeler certification and it made me a better financial modeler. What are you waiting for? Visit fmi@www.fminstitute.com podcast and use code podcast podcast to save 15% when you enroll in one of the accreditations today.