Advanced Excel for Finance Professionals A self study

Advanced Excel for Finance Professionals A self study material from South Asian Management Technologies Foundation

Welcome Back to Session 1

Course Coverage • • Database Concepts Data Organisation Functions Tools What-if Special Features Macro

Session 1: Excel as Database

Excel as a Database • Excel workbook can work as a limited capacity database if you plan the data layout correctly. • Excel allow to look at the data in many ways similar to a database application: – Sort data in many different ways, – Filter to see only data with specific attribute – Reorganize your data in ways as your needs change.

Structuring Excel as Database • Some best practice to create Excel List – Each column to contain data of same category in every row in the column like age, name, etc – Each row in the list contains all of the fields of data for one object like person, organization, material, etc. – Ideally the first row of the list must contain a unique name at the top of each column. – This first row need to be the first row of the worksheet, that is row 1 – start anywhere

Structuring Excel as Database • Some best practice to create Excel List – The row describing column headings may be formatted differently using larger font, bold, etc. – Ideally no blank rows should be in the list though there can be blank cells in a column – All data in a column must have same format – We can store other data in the worksheet but outside the boundaries of the list

Session 2: Range Names

Range Name • This is a simple function to refer to a range of cells by a name instead of the coordinate • This is useful to remember the cell and use them for any process • Select the range of cells you want to name

Range Name • After selecting the cells just type the name in the cell coordinate window on the top left corner

Session 3: Functions Explained

Functions • There are various types of Excel functions – Financial – Statistical – Mathematical – Logical – Scientific – Text • We will discuss some select functions

Functions • Select Functions – DATE – TEXT – IF – VLOOKUP – MATCH/INDEX – SUMIF – LOGICAL/ERROR TRAPPING – ROUND

Date Functions • • • Now Today Year Month Day Weekday

NOW • Returns serial number of current date and time. If the cell format was General before the function was entered, the result is formatted as a date. • Syntax – NOW( ) • Excel stores dates as sequential serial numbers so they can be used in calculations. By default, January 1, 1900 is serial number 1, and January 1, 2008 is serial number 39448 because it is 39, 448 days after January 1, 1900.

NOW • Try this out – don’t worry if the end result is not the same

TODAY • Returns the serial number of the current date. The serial number is the date-time code used by Microsoft Excel for date and time calculations. If the cell format was General before the function was entered, the result is formatted as a date. • Syntax – TODAY( ) • Excel stores dates as sequential serial numbers so they can be used in calculations. By default, January 1, 1900 is serial number 1, and January 1, 2008 is serial number 39448 because it is 39, 448 days after January 1, 1900.

TODAY • Don’t worry if – You get a number instead, change cell format

DATE • Date is more an input than output command. This command is necessary if you wish to use the year, month, day, or weekday functions • Syntax – date(year, month, day)

YEAR • Returns the year corresponding to a date. The year is returned as an integer in the range 1900 -9999. • Syntax – YEAR(serial_number) • Serial_number is the date of the year you want to find. Dates should be entered by using the DATE function, or as results of other formulas or functions. For example, use DATE(2008, 5, 23) for the 23 rd day of May, 2008. • Values returned by the YEAR, MONTH and DAY functions will be Gregorian values regardless of the display format for the supplied date value.

Example A Date 7/5/2013 7/5/13 Formula =YEAR(A 2) =YEAR(A 3) Description (Result) Year of the first date (2013) Year of the second date (2013)

YEAR

MONTH • Returns the month of a date represented by a serial number. The month is given as an integer, ranging from 1 (January) to 12 (December). • Syntax – MONTH(serial_number) A Date 15 -Apr-2013 Formula =MONTH(A 2) Description (Result) Month of the date above (4)

MONTH

DAY • Returns the day of a date, represented by a serial number. The day is given as an integer ranging from 1 to 31. • Syntax – DAY(serial_number) A Date 15 -Apr-2008 Formula =DAY(A 2) Description (Result) Day of the date above (15)

DAY

TEXT Functions • CONCATENATE(text 1, text 2, . . text) – Joins several text strings into one text string. • SUBSTITUTE( text, old_text, new_text, instance) – Substitutes new text for specific old text in a text string.

TEXT Functions • TRIM – Removes all extra spaces from a text string except for single spaces between words. • RIGHT (text, number of characters) – Returns a specified number of characters from the end of a text string. – Similar treatment for LEFT() function

TEXT Functions • FIND (find_text, within_text) – Finds one text string (find_text) within another text string (within_text), and returns the number of the starting position of find_text from the first character of within_text. • MID( text, start_number, number of characters) – Returns a specified number of characters from a text string, starting at a specified position.

TEXT Functions • LEN – Returns the number of characters in a text string. • LOWER – Converts all uppercase letters in a text string to lowercase. – Similar treatment for UPPER, PROPER,

Teaser • Develop a text function for these cases: – We have to replace the word Bombay to Mumbai in a large file. Problem is we do not know where the word appears in a sentence. – A database is available where the name is mentioned in a single cell. Extract the surname from the list of names and use them in a sentence “Dear <surname>”

Logical Function: IF • Returns a value if a specified condition evaluates to TRUE and another value if it evaluates to FALSE. • Use IF to conduct conditional tests on values and formulas resulting in values. • Syntax – IF(logical_test, value_if_true, value_if_false) • Logical_test is any value or expression that can be evaluated to TRUE or FALSE. • Value_if_true is the value that is returned if logical_test is TRUE. • Value_if_false is the value that is returned if logical_test is FALSE.

IF • Up to seven IF functions can be nested as value_if_true and value_if_false arguments to construct more elaborate tests. • When the value_if_true and value_if_false arguments are evaluated, IF returns the value returned by those statements. • If any of the arguments to IF are arrays, every element of the array is evaluated when the IF statement is carried out.

Example 1 A Data 123 Formula Description (Result) =IF(A 2<=100, "Within budget", “Above budget") If the number is less than or equal to 100, then the formula displays "Within budget“, else it displays "Over budget" (Above budget) =IF(A 2<100, A 2*. 25, “A 2*. 35") If the number above is 100, then take 25% of it. Otherwise, 35%

Example 1

Example 2 A Grade A: 90 and above Score Grade B: Between 80 -89 45 Grade C: Between 70 -79 90 Grade D: Between 60 -69 78 Grade F: Below 60 Description (Result) Assigns a letter grade to the first score (F) Assigns a letter grade to the second score (A) Assigns a letter grade to the third score (C)

Example 2 • In this example, – the second IF statement is also the value_if_false argument to the first IF statement. • Similarly, – the third IF statement is the value_if_false argument to the second IF statement. • For example, if the first logical_test (Average>89) is TRUE, "A" is returned. If the first logical_test is FALSE, the second IF statement is evaluated, and so on.

Example 2: Nested IF First =IF(A 2>89, "A", Else 1) If A 2 is greater than 89, show 'A' or solve the Else 1 condition Else 1 = IF(A 2>79, "B", Else 2) If A 2 is less than 90 but greater than 79, show 'B' or solve the Else 2 condition Else 2 = IF(A 2>69, "C", Else 3) If A 2 is less than 80 but greater than 69, show 'C' or solve the Else 3 condition Else 3 = IF(A 2>59, "D", "F") If A 2 is less than 70 but greater than 59, show 'D' or show 'F' where A 2 is less than 60

Example 2

SUMIF • Adds the cells specified by a given criteria. • Syntax – SUMIF(range, criteria, sum_range) • Range is the range of cells you want evaluated. • Criteria is the criteria in the form of a number, expression, or text that defines which cells will be added. For example, criteria can be expressed as 32, "32", ">32", "apples". • Sum_range are the actual cells to sum. • The cells in sum_range are summed only if their corresponding cells in range match the criteria.

Example Property Value Commission 100, 000 7, 000 200, 000 14, 000 300, 000 21, 000 400, 000 28, 000 Compute commission for properties valued above 16000 Formula Description (Result) =SUMIF(A 2: A 5, ">160000", B 2: Sum of the commissions for B 5) property values over 160000 (63, 000)

Example

ROUND FUNCTION • Rounds off the value to a specific number of decimal points and displays the same • Different from formatting where the internal value remains unchanged only display changes • Syntax – ROUND(number, digits) • Number is the number or cell reference which you want round off to a number of digits after decimal. • Digits is the number of digits after decima point to which you want to round off the number.

Example • Case: Test for difference between round and displaying number of decimal points

Solution • Display changes only the displayed value but retains the original value • Round changes the background value

VLOOKUP • Searches for a value in the leftmost column of a table, and returns a value in the same row from a column you specify in the table. • Use VLOOKUP when your key values are located in a column to the left of the data you want to find. • The V in VLOOKUP stands for "Vertical. " • Syntax – VLOOKUP(lookup_value, table_array, col_index_num, range_lookup) • Lookup_value is the value to be found in the first column of the array. Lookup_value can be a value, a reference, or a text string. • Table_array is the table of information in which data is looked up. Use a reference to a range or a range name, such as Database or List.

Get Ready for Session 2