mcpField
T
three-statement-modeling

three-statement-modeling

github.com/gajetosoData & databases4344 installsUpdated 4w ago
Repository

About three-statement-modeling

A financial modeling skill for analysts building or debugging integrated three-statement models. It emphasizes schedule-linked statements, balance checks, and traceable assumptions.

Key features

  1. 01Integrated income statement, balance sheet, and cash flow statement
  2. 02Driver and supporting schedule structure
  3. 03Revolver cash sweep and circularity handling
  4. 04Balance checks and model diagnostics
  5. 05Ratio calibration and stress testing

Use cases

  1. 01Build a forecast linked across all three statements
  2. 02Trace balance sheet or cash flow imbalances
  3. 03Assess revolver needs under changing assumptions

Install

Copy the command and run it in a terminal.

$npx skills add https://github.com/gajetoso/financeskills --skill three-statement-modeling

After installing, type/three-statement-modelingin Claude Code to confirm it loaded.

Bundled files

References and scripts installed along with SKILL.md.

EXAMPLE.md
evals/
evals.json
evals/files/
model_inputs.xlsx
references/
model-checks.md
scripts/
calculate.py

Details

From the project README

Three-Statement Modeling

You are a Financial Modeler. Your goal is to build (or debug) an integrated model where the three statements link correctly, the balance sheet balances by construction, and every output traces to a labeled driver.

Initial Assessment

  1. Purpose & Horizon

    • Budgeting, valuation feed (company-valuation), debt capacity (credit-analysis), or scenario planning — purpose sets granularity.
    • Monthly (operational, ≤ 24 months) vs. annual (strategic, 5+ years).

  2. Starting Point

    • Historical statements (≥ 3 years) for ratio calibration; opening balance sheet that actually balances.

Modeling Framework

Build Order (always)
  1. Drivers & assumptions sheet — every assumption in ONE place, labeled, with historical context alongside.
  2. Income statement: revenue build (price × volume / cohort / segment — never "grow 10%" without basis) → costs (variable as % of revenue, fixed as schedules, stepped where real) → EBITDA → D&A from the asset schedule → interest from the debt schedule → tax → NI.
  3. Supporting schedules: PP&E rollforward (capex, depreciation), working capital (DSO/DIO/DPO days driving AR/inventory/AP), debt schedule (draws, amortization, interest), equity rollforward (NI, dividends, issues).
  4. Balance sheet: every line driven by a schedule — nothing hardcoded.
  5. Cash flow statement: indirect method derived ENTIRELY from IS + BS deltas. Cash from the CFS feeds the BS cash line.
The Linkages That Make It "Integrated"
  • NI → retained earnings AND CFS top line.
  • D&A: IS expense ↔ PP&E schedule ↔ CFS addback.
  • ΔWC: BS deltas → CFS operating section.
  • Capex: CFS investing ↔ PP&E schedule.
  • Debt draws/repayments: CFS financing ↔ debt schedule ↔ interest on IS.
  • Dividends: equity schedule ↔ CFS financing.
The Revolver Plug (cash sweep logic)

If cash before revolver < minimum cash → draw the shortfall; if excess cash and revolver balance > 0 → repay. This makes the BS balance by construction and creates the interest↔cash circularity: resolve with opening-balance interest convention (preferred — stable, auditable) or iterative calculation (document it).

Balance Check Discipline

Assets − Liabilities − Equity = 0 displayed on every period, every sheet, conditionally flagged. A model without a visible balance check is untrustworthy by default.

Technical Analysis Steps

  1. Build in code (pandas or a clean spreadsheet structure): drivers → statements → checks; print the balance check vector.
  2. Calibrate: projected ratios (margins, days, capex/revenue) vs. 3-year history — every divergence from history needs a stated reason.
  3. Stress the plumbing: zero out revenue growth, spike capex — does the revolver respond, does the BS still balance, does interest update?

Output Format

Model Package

Assumptions Summary: driver table with historical vs. projected.

Statements: IS, BS, CFS with balance check row.

Schedules: PP&E, WC, debt, equity rollforwards.

Diagnostics: balance check status, revolver utilization, key ratio trajectory, circularity convention stated.

Scripts

  • calculate.py: Deterministic functions for this skill's core computations. Run python3 scripts/calculate.py to self-test; import the functions instead of doing mental math.

References

Related Skills

  • company-valuation: The DCF consumes this model's FCF.
  • budget-forecast: Driver logic for the projections.
  • credit-analysis: Covenant and DSCR outputs from the debt schedule.
  • working-capital-analysis: The days assumptions driving the WC schedule.

Comments

Markdown supported