5 Best Financial Modelling Software Compared

As a crucial aspect of financial analysis, financial modeling helps businesses to forecast a company’s future. While it’s possible to conduct analysis using Excel and spreadsheets, it can be a time-consuming and error-prone process which can be perfectly solved with automation. Financial modeling software alleviates the burden of having to deal with data-heavy tasks and makes it easy for businesses to project for tomorrow, while planning for today.

Let’s take a look at some of the best financial modeling software that can streamline financial modelling techniques.

Coming Up

What is Financial Modelling Software?

Why is Financial Modelling Important?

What are the Types of Financial Modelling Tools?

Why is Financial Modelling Software Better than Spreadsheets?

What are Common Features of Financial Modelling Software?

What is the Best Financial Modelling Software?

What are Common Applications of Financial Modelling Software?

How to Choose Financial Modelling Software?

Final Words

What is Financial Modelling Software?

Financial modeling software provides a user-friendly workflow to automate the processes involved in creating forecasts.

Financial modeling software offers tools so that users can create complex financial models to assess variable situations in business and also to offer deep business insights. With this information at hand, business owners, management teams, and stakeholders have what they need to make optimal decisions in the business’ best interest.  

Why is Financial Modelling Important?

Financial modelling is valuable for a variety of reasons. For starters, it helps businesses to understand their past, present, and future scenarios deeply.

Using this information, it becomes clear whether or not a prospective project or goal is feasible. Given an accurate outlook at the future before it happens, key people within the organisation will have what they need to maximise profitability, minimise risk, and optimise business processes.

What are the Types of Financial Modelling Tools?

Knowing how to build a financial model will depend on the financial modelling tools you have at your disposal. Here’s a look at the two main tools that you can (or may already) rely on:

1. Financial model spreadsheets

The most popular spreadsheet for financial modelling is Microsoft Excel. Financial model spreadsheets are typically created by FP&A professionals who must aggregate, organise, and analyse data. Naturally, this is error-prone and time-consuming.

2. Financial modeling software

Financial modeling software refers to technology that automates the entire process to make it more efficient, reduce errors, and save time. Using artificial intelligence and machine learning results in increased accuracy. Financial modeling software may also be called financial model builders.

Why is Financial Modelling Software Better than Spreadsheets?

As you can imagine, when you’re comparing a data-heavy process to an automated solution, there are many differences that make the latter your best bet. In terms of financial modeling software versus spreadsheets, here’s a look at what you stand to gain:

1. No Learning Curve

With spreadsheets, you need an experienced and skilled professional who knows how to work within the cells and apply formulas. This commands a specific skill set and knowledge base that financial modeling software completely replaces. Anyone can leverage financial modeling software that has an easy-to-use interface.

2. Reduced Errors

Given the data-heavy nature of financial analysis, you’re prone to errors when using spreadsheets. You can prevent these errors using financial modeling software that performs the process with exquisite accuracy.

3. Collaboration Capabilities

If your analysis and financial models are stuck across spreadsheets, you not only run the risks of having key person dependencies and bottlenecks, but you also reduce the opportunity for collaboration. Financial modeling software allows you to collaborate across departments and users, along with maintaining version control so that nothing gets lost in the shuffle.

What are Common Features of Financial Modelling Software?

Financial modeling software comes packed with many helpful features. When searching for the software of your choice, look out for the following:

1. Calculation performance

You’ll want a tool that can transform complex calculations into straightforward and digestible information without time delays.

2. Accessibility

Softwares stores your data securely and makes it possible for any user with access to leverage data whenever they need it, from wherever they are. Rather than information being stuck on disparate spreadsheets, you have a centalised location to find what you need.

3. Database

You’ll want to find a solution that has the ability to store a massive amount of data. Most importantly, it should be secured and protected using encryption, at the very least.

4. Fast-paced

Using software should speed up the time it takes to gain access to insights, not slow you down. Therefore, you want a financial modeling software that can analyse and interpret data in any time without delays.

What is the Best Financial Modelling Software?

Now, it’s time to review some of the best financial modelling software.

1. Oracle

We’ll start with Oracle. Oracle SQL Developer is a free graphical tool. It can be used to browse database objects, edit and debug PL/SQL, run reports, and run SQL statements. It’s a great tool for those looking to integrate with their Oracle and relational databases. As you can tell by the technical explanation, Oracle SQL is intended for a tech-savvy user (i.e. a developer) who has a firm understanding of databases and how to use them.

2. Jirav

Jirav is an all-in-one forecasting, dashboarding, and budgeting tool made for finance and accounting teams. Jirav helps businesses to create plans and test an array of scenarios, track actuals against plans, and leverage pre-built reports and pre-configured integrations.

Using Jirav, finance and accounting professionals can spend less time performing data-heavy tasks to glean insights, and instead spend more of their time reviewing insights and making plans in accordance.

3. Finmark

Finmark is a financial modelling software that provides real-time data analysis for finance. Using the tool, you can build custom dashboards, dive deep into data, automate reporting, and generate financial statements. As a venture-funded platform, Finmark is on a mission to eliminate the need for spreadsheets by providing an easy-to-use tool.

4. IBM Cognos

IBM Cognos analytics is a business intelligence tool that’s part of IBM’s business intelligence suite. The software helps to make data visualisation easy and provides the opportunity to aggregate and share data across departments. Cognos Analytics has interactive dashboards that can be customised to a user’s liking. It’’s analytical tools include trend analysis, what-if analysis, and advanced analysis.

Bonus: SolveXia

SolveXia is a finance automation platform that offers a wide array of solutions for anyone in finance and accounting departments. When it comes to data, the tool is able to automate data preparation and reporting, thereby removing the need for spreadsheets. This makes it easy to streamline tax, finance, and compliance processes that are often error-prone and time-consuming. SolveXia can run advanced models and forecasting in minutes and share results and insights with stakeholders.

With SolveXia, you gain access to advanced analytics, a central and secure repository for your data, and easily customisable dashboards and reporting. The drag-and-drop user interface and library of pre-built templates make it so you can automate finance processes in less than 30 minutes, with or without the aid of an IT team.

Since it’s a low-code solution, you don’t need any developer or coding experience. Plus, SolveXia can help you perform account reconciliation, expense management, regulatory reporting, APRA reporting, and more!

What are Common Applications of Financial Modelling Software?

Financial modelling software is useful for many purposes in any kind of business. Take a look at what you can leverage the above mentioned tools to help you accomplish:

1. Cash Flow

Using a financial modelling tool, you can rest assured that you’ll have a clear view of your company’s cash flow (which is integral in making smart decisions). The cash statement is a report that shows you the stability of your company based on assets and liabilities in their current status.

2. Financial Risk Modeling

By combining arithmetic, math, and economics, financial risk modeling aids in determining the probable threats that exist in any given portfolio. Financial modelling software will showcase market risk and value at risk.

3. Capital Budgeting

This ability in financial modelling helps to understand if assets or investments that your company is considering can be taken on using debt or existing funds. When performed manually, it can take a lot of time to do, but financial modelling software cuts the time down dramatically.

How to Choose Financial Modelling Software?

With all the financial modelling software out there, you’re probably wondering how you’re supposed to make the right choice.

This is our guide to how to choose financial modelling software:

• Consider your needs to narrow down the options in the market based on what you’re looking to accomplish
• Keep in mind the learning curve as software solutions are intended to make lives easier, not more complicated
• Demo the software first to test it out before jumping into any commitments
• Think about long-term business needs and how the software may be able to scale to meet your demand

Final Words

Financial modeling software is an extremely powerful tool. Given the technology, you can glean insights from your existing and historical data in order to make the best business decisions. Since no one knows what will happen in the future with certainty, financial modelling software is able to leverage your data to closely project the likelihood of certain outcomes (based on variables you can decide on today).

When you’re ready to dive into insights from your data, an automation tool like SolveXia is here to help you, along with automating your finance processes. Schedule a demo to learn about all the possibilities that you can have at your fingertips!