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Financial Model Auditing

No-one knows your business better than you. SumProduct offers process matter expertise, not subject matter expertise and no area is more important than checking the models you rely upon. SumProduct can offer an array of financial model auditing services.

What goes wrong?

  • Model does not actually do what it is meant to do or has become a bloated imitation of its original construct
  • Logic may not work in all situations
  • Model attempts too much and / or gets too complex
  • Assumptions may not be used or have been input incorrectly
  • Value drivers in model do not reflect actual business drivers

Why does it matter?

  • Management decisions are based on the model’s outputs
  • These decisions may therefore be based on inaccurate information
  • The wrong decisions may be made
  • Expensive errors may be made or lawsuits may arise
  • Reputational risk for modeller, bank and company
  • Financial risks for bank and company

How can we help?

Depending upon your needs, budget and level of reliance, we can offer various services:

  • Assurance Opinion: We can review the logic, mathematical accuracy and consistency of your financial model. Whilst we provide no opinion on the probability of assumptions being achieved, we can opine on the integrity of the model structure and its calculation by reviewing the formulae and providing a high-level analysis (similar to ratio analysis) of the model. This is suitable for securing bank financing and equity forecasting;
  • Agreed Upon Procedures: At your direction, we can undertake certain checks and review certain aspects of the model (e.g. documentation tick-backs, scenario testing, key driver analysis). We provide no opinion on the model as our checks by their very nature are limited in scope, but we do document our findings. This is suitable for a “health check” where companies want greater internal comfort on whether a key model is working as it should be;
  • Assistance With Self-Reviews: A self-review is a review undertaken by the modeller and / or the company or team relying upon the model. SumProduct can work in an advisory role to suggest what tests should be undertaken and where key risks may lie. This is suitable where assurance required is low or where budgets are tight.

Contact us for a more information and a quote today.