The success of capital or financing transactions can be undermined by the lack of a credible projections model.
Many spreadsheets evolve over time without well-structured design, integrity checks, and are poorly documented. Making a relatively simple change can often take a long time, have unexpected consequences and/or result in errors from incorrect calculations or input assumptions as famously illustrated by debacles such as the bidding process for the West Coast mainline franchise.
Smith & Williamson has experienced staff who regularly build robust and flexible models which can meet the needs of different users, whether management, financiers or professional advisers. We usually develop models in Microsoft Excel; however, we also have the knowledge to use other specialist products including Brixx. We are also often asked to validate models prepared by third parties and provide a report to financial institutions or public authorities.
Our approach
The development of business plan models usually involves the following steps.
Step 1: Familiarisation – review of any relevant available and/or existing data.
Step 2: Kick-off meeting – agreement regarding new model inputs, outputs, calculations, potential model sensitivities and project timetable.
Step 3: Model outline – design an agreement regarding structure for input, processing and output sheets.
Step 4: Model preparation – detailed model development, including internal integrity checks, outline documentation and initial checks using test data.
Step 5: Acceptance testing – model handover for review and detailed testing; appropriate amendments made and then final version of the model produced.
We seek, wherever possible, to transfer the ability to use the models to client's staff so that they obtain the maximum benefit from the knowledge and skills we have demonstrated during the construction of the model.
Our experience
Our modelling team is made up of qualified accountants who are experienced at modelling in a range of different business sectors, particularly sustainable technology. Smith & Williamson has also validated business plan models for various financial institutions, including clearing banks, regulators and the Scottish Government.
Case studies
Wind farms
This client acquired wind farms in Germany and Italy making it the largest non-utility provider of wind power in Europe. Smith & Williamson performed validations for financial institutions providing debt finance. The final validation arose from a €650m refinancing, prior to asset disposal.
Biomass
During the last twelve months we have performed model builds/reviews and/or due diligence regarding biomass and waste to energy projects in the UK and Europe.
Solar energy
This new business was raising finance to develop solar installations. Our team created a flexible model template enabling management and advisers to assess debt serviceability and investor returns for a wide range of site capacities starting from initial feasibility. A separate team then validated the model logic.
Hydro-electric
This international energy group was seeking an AIM listing. Working with our Nexia associates, Smith & Williamson were involved in the initial admission to AIM and the subsequent reverse acquisition of certain utility assets. As reporting accountant, we performed a review of the integrity of the projections model.
About us
Smith & Williamson has been managing the financial affairs of private clients and their business interests for over a century. We are one of the top ten largest firms of accountants in the UK, according to Accountancy Age magazine, 2013 and our investment management business has over £14bn funds under management and advice (as at 31 July 2013).
Our primary aim is to help our clients achieve their financial ambitions, both corporate and personal. Our clients are varied – private individuals, mid-large businesses, professional practices and non-profit organisations. Our business spans 12 principal offices in the UK and Ireland, with locations in the City of London, Belfast, Birmingham, Bristol, Dublin, Glasgow, Guildford, Jersey, Manchester, Salisbury, Southampton and Worcester, and an international capability in over 100 countries through membership of Nexia International (the seventh largest international accounting and consulting network) and M&A International.
In an award-winning business as diverse as ours, professionalism and teamwork are key. We recognise that clients and intermediaries take comfort from knowing that they can easily reach senior people and decision-makers in our organisation who are able to understand their needs and objectives.
Our business thrives on its people – a pool of highly talented and enthusiastic individuals who deliver a broad and innovative range of services, but without compromising on delivering a genuinely director-led service. Technical excellence underpins how we deliver our services and our teams are dedicated to offering practical financial solutions.
People may ask what sets us apart from our competitors; put simply, it's our people – ambitious, talented and enthusiastic professionals who enjoy what they do and relish the opportunity to work together and with our clients.
Smith & Williamson LLP Regulated by the Institute of Chartered Accountants in England and Wales for a range of investment business activities. A member of Nexia International. Nexia Smith & Williamson Audit Limited Registered to carry on audit work and regulated by the Institute of Chartered Accountants in England and Wales for a range of investment business activities. A member of Nexia International. The word partner is used to refer to a member of Smith & Williamson LLP.