Financial modelling: Calculate Net Present Value (NPV) without Excel functions

By Joshua Grimm

Thursday 15th September 2022

Net Present Value (NPV) is a standard method of capturing the time value of money to appraise long-term projects and investments. This webinar will focus on alternative ways of calculating NPV in Excel, including our recommend approach of using first principles with calculated discount factors. Whether you prefer Excel’s native functions or the first principles approach, understanding both gives you a complete understanding of what’s possible.

Learning points:

  • Overview of the theory behind NPV and time value of money in the context of financial modelling for project finance and assets in the energy and infrastructure sector
  • Demonstration of the native NPV/XNPV functions in Excel commonly used in financial modelling
  • Understand the importance of understanding the financial model timeline and how it impacts NPV/XNPV and/or first principles calculations
  • Develop a stronger connection between the concept of NPV and IRR in a financial model
  • Explore examples of typical errors around NPV calculations in financial models and how to avoid them