An International Meeting of
the American Accounting Association

2005 Annual Meeting

August 7–10, 2005
San Francisco, California

Come to the City by the Bay!

*CPE Session 13: Sunday, August 7, 8:00 AM – 11:00 AM

Teaching Financial Modeling

This Session has been CANCELED

Description/Objectives:
Steven Aldridge (Financial Management, June 2003) states "… beyond a simple discounted cash flow analysis, most accountants won’t have had sufficient training to build spreadsheet models …"

In industry, the accountant is rushed to provide financial information to a variety of constituents. Many times a quick financial model is built, the questions answered and the workbook forgotten until the questions are asked again. Then the fun begins. How was it built? What were the variables, what were the formulas, etc?

Students need to prepare financial models using paper and pencil to understand the underlying theory. But they don’t need to solve subsequent problems in this manner. Instead, we should teach our students to systematically construct well-documented financial models using Excel®.

The objectives of this workshop are:

• Complete a step-by-step exercise in building a multi-worksheet financial model.
• Determine the inputs, the required formulae, and the format of the output.
• Determine the validity of the results.
• Interpret the results for nonfinancial staff.

Each participant will be provided a set of handouts describing the Gasoline Alley Case. Through a combination of presentation, discussion, and hands-on exercises participants will be able to adopt the exercise to teaching how to preparing usable, well-documented financial models.

Format/Structure:
The workshop will focus on preparing usable, well-documented financial models by presentation, discussion, and hands-on exercises. All attendees should bring a laptop with Excel installed. Basic familiarity with the Excel will be assumed.

Intended Audience:
Faculty and practitioners who will be teaching the first course in Financial Accounting, the first course in Managerial Accounting, and/or Accounting Systems.

Presenter:
William C. St. John, Jr., Rensselaer Polytechnic Institute

* Denotes special requirements or prerequisite