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ARBITRATION WORLD ARBITRATION WORLD Managing Financial Models without understanding Excel by Colin Johnson (Head of International Arbitration, Forensic, Grant Thornton UK LLP) Financial models, especially discounted cash flows (DCFs), are a common feature of many international arbitrations with respect to quantum assessments. They are the basis for many valuations, but can be extremely difficult to understand, especially for those unfamil- iar with spreadsheets. It can be even harder, sometimes, to be able to present the results in a clear and simple way. If those financial models and DCFs leave you glassy-eyed, you need to read on. This article highlights how, without being a Microsoft Excel expert, you can gain greater understanding of what a model is doing, use that to challenge whether the inputs are correct and, overall, take more control. MAKING A MODEL’S WORKING MORE VISUAL One of the biggest problems for those who are not fans of spread- sheets is simply being confronted with sheet after sheet of numbers; even worse is the presence of complicated equations where it is unclear (without considerable effort and expertise) where the data used by the formula comes from—or in some cases, even what a formula does. Just because you are not such an expert, however, does not mean there is no way to understand how the model works. Particular ways to understand include the use of graphs, flow charts or a model specification. 27