A spreadsheet approach to stochastic financial modeling

Spreadsheet Software as a Teaching and Learning Tool: Perspectives from an Undergraduate Financial Modelling Subject

“…Partially supporting these arguments, this study finds that the students were divided: the majority of the students stated that contextual grounding of managerial and finance subject was a wastage of time, to a few, the subject was an enabling subject that was an 'acid test' of prior learning of management accounting and finance subjects; the students in this category had significant work experience or experience of using Excel for everyday work. Though these (positive) students were not specific about any topic or content of the subject, their endorsements about prior learning in management accounting and finance subjects were consistent with the earlier literature (Dennis, 2004;Kruck & Maher, 1999;Togo, 1992); these students had, however, a different view about the difference between work practices and principles taught in the subject.…”

“…The skills are generic and can be applied to different problem contexts, and in different subjects, the educators teach these skills or the students spend time to learn these skills to use in jobs. For example, students can use spreadsheet programs to learn risk analysis skills (Dennis, 2004;Kelliher, Fogarty, & Goldwater, 1996;Togo, 1992), design and error detection skills (Alexander, 1996;Heagy & Gallun, 1994;Ian, Erwin, & Peter, 2005), develop algorithmic thinking skills (Borthick & Clark, 1986;Neil, 2004), memorisation and integrations skills (Alexander, 1996;Kruck & Maher, 1999;Teets & Desmond, 1995), and scenario analysis skills (Alexander, 1996;Dennis, 2004;Togo, 1992). In recent times, the spreadsheet is being used extensively to develop financial models that require integration of finance, cost accounting, financial accounting concepts and spreadsheet functions to build and design useful decision models (Read & Baston, 1999) (Kruck & Maher, 1999).…”

“…The use of spreadsheet software is perceived as a necessity , especially, the design and documentation issues were perceived extremely useful for these students (Alexander, 1996;Ian, Erwin, & Peter, 2005;Kruck & Maher, 1999). Students also showed enthusiasm to use spreadsheet for managerial accounting topics (Borthick & Clark, 1986;Dennis, 2001) such as budgeting, and cash flow forecasting, Another cohort with strong finance orientation found finance topics quite beneficial to enhance their skills in finance (Dennis, 2004;Henk & Michael, 1998;Kruck & Maher, 1999;Mabey, Topham, & Kaye, 1998;Togo, 1992). The use of spreadsheets gave the students opportunities to check their answers and receive feedback on their answers (Mark & Clyde, 2003).…”

“…The students were asked to build spreadsheet models; the models required the students to apply theoretical understanding of concepts such as effective interest rate calculation, amortization of principal balance calculation, and present value of money concepts (Kruck & Maher, 1999). The study also revealed that the students needed to know the concepts of risk for designing financial models in: capital budgeting, budgeted cash flows, and budgeted income statement (Dennis, 2004;Togo, 1992).…”

Business analytics: an example of integration of TD-ABC and the balanced scorecard

“…However, the stochastic simulation approach has been discussed for a long time both within MA with different directions for improving theory assumptions and has been used to make teaching more realistic (see, e.g. Magee, 1976;Kottas et al,1978;Said, 2016;Schriber, 2009;Togo, 1992Togo, , 2004). We found very few studies that were actually combining performance measurement, BSC with Monte Carlo simulation (e.g.…”