Financial Modeling

Dynamic Financial Plan

Financial Modeling Service

The financial model is a dynamic financial plan that allows for automatic changes depending on different activities. For example, by raising the price of products by 5%, the financial model automatically recalculates both revenue and wage levels, cash flow, profit, decline in turnover and other parameters.

With the help of such a model, companies can timely forecast the amount of money needed for different development scenarios. The model takes into account various risks, such as a sharp rise in raw material prices or insufficient sales.

A typical financial model includes income statement, balance sheet and cash flow projections, as well as other help calculation tables (such as loan repayment schedules or depreciation forecasts). In more complex variations, the financial model is used for company valuation, share purchase, sale transactions, and others.

Financial models are used to:

  • attract bank financing;
  • attract investment;
  • evaluate the company;
  • make decisions about buying / selling a company;
  • make capital investment decisions;
  • plann development and operational activities of the company (budgeting).

Examplescott-blake-x-ghf9LjrVg-unsplash (1)

Financial modeling helps a company avoid situations where a too fast development could lead to financial difficulties. A construction company, with which AG Capital worked with, predicted a two-and-a-half-fold increase in orders and a very good profit after a successful year. However, the cash flow plan showed that the company would find itself in a very unpleasant situation at the beginning of the year – it had to buy materials and pay the builders, but the profit was expected only much later. In order to avoid a situation where the company would not be able to finance the orders received, its management decided to follow a gradual rather than a rapid growth path.


Developing a financial model usually costs our clients from 1,500 to 4,000 euros (depending on the size of the company and the complexity of business processes). As a result, customers get a clear picture of the impact of their decisions on the company’s future financial situation with the opportunity to see changes in strategy in the financial plan.

If you want to develop your company, write to or call us on +371 29992271 to arrange a meeting.

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