---
name: financial-model-formatting
source: https://app.decimal.ai/s/financial-model-formatting@1/SKILL.md
source_sha256: 9337875630fd
---

# Financial Model Formatting

## Contract

When you produce or edit a financial-model spreadsheet (openpyxl/xlsxwriter code, a
cell-by-cell layout, or a description of the formatting), apply the investment-banking
modeling house style: cells are font-colored by their ROLE, numbers use the fixed
finance format codes, assumptions live in referenced cells, and hardcodes carry a
source tag. Use this whenever the deliverable is a model (DCF, LBO, three-statement,
comps, budget, schedule, cap table) — not for a one-off data dump.

## Rules

### Rule 1 — Font color by cell role (the blue/black/green/red convention)

Color the FONT of every value cell by what kind of value it holds. This is the
single most load-bearing rule; never leave every cell the default black.

| Cell role | Font color | Hex | RGB |
|---|---|---|---|
| Hardcoded input / assumption (a number a user changes for scenarios) | Blue | `0000FF` | 0,0,255 |
| Formula or calculation | Black | `000000` | 0,0,0 |
| Link to a cell on ANOTHER sheet in the SAME workbook | Green | `008000` | 0,128,0 |
| Link to a cell in a DIFFERENT (external) workbook file | Red | `FF0000` | 255,0,0 |

In addition, fill (background) key assumptions a reviewer must revisit with **yellow**
(`FFFF00`). Yellow is a fill, not a font color; it stacks on top of the blue font.

### Rule 2 — Number format codes (the finance presentation set)

Apply these exact Excel number-format strings. The defaults a general model reaches
for (two decimals, leading-minus negatives, "0" for zero) are wrong here.

- Currency / dollars: `$#,##0` — whole units, no cents. State the unit in the column
  header instead of in the cells, e.g. a header reading `Revenue ($mm)`.
- Negatives in parentheses and zeros shown as a dash, combined into one code:
  `$#,##0;($#,##0);-` for currency, or `#,##0;(#,##0);-` for plain counts.
- Negatives are ALWAYS parenthesized — `(1,250)`, never a leading-minus `-1,250`.
- Percentages: `0.0%` — exactly one decimal place.
- Valuation multiples (EV/EBITDA, P/E, EV/Revenue): `0.0x` — one decimal and a literal
  trailing `x`, e.g. `8.5x`.
- Years used as labels: store/format as TEXT `2024`, never the General/number format
  that renders a thousands separator (`2,024`).

### Rule 3 — Assumptions are referenced cells, never inline constants

Every driver (growth rate, margin, tax rate, multiple) gets its OWN labeled cell, and
formulas REFERENCE that cell. Never bake a driver into a formula as a literal.

- Use `=B5*(1+$B$6)` where `$B$6` holds the growth assumption.
- Never `=B5*1.08`.
- Likewise, totals and ratios are Excel formulas (`=SUM(...)`, `=AVERAGE(...)`,
  `=C9/C8`), never a value you computed yourself and pasted as a literal.

### Rule 4 — Tag every hardcode with its source

Each hardcoded input carries a brief cell note recording where the number came from —
the source system or document, the date, and the specific reference it was taken from.

### Rule 5 — Deliver with zero formula errors

No `#REF!`, `#DIV/0!`, `#VALUE!`, `#N/A`, or `#NAME?` may survive in the delivered
file. Guard division denominators and check references before delivering.

## Worked examples

### Rule 1 — color by role

A monthly SaaS build hardcodes starting ARR and a churn rate, computes net ARR, and
pulls headcount from an Operating sheet.

BEFORE (base default — everything plain black):
```python
ws["B2"] = 1200000          # starting ARR (input)
ws["B3"] = 0.03             # monthly churn (input)
ws["B4"] = "=B2*(1-B3)"     # net ARR (formula)
ws["B5"] = "=Operating!C10" # headcount, same workbook other sheet
# no font colors set -> all black
```

AFTER (conforming — font color by role):
```python
ws["B2"].font = Font(color="0000FF")  # input -> blue
ws["B3"].font = Font(color="0000FF")  # input -> blue
ws["B4"].font = Font(color="000000")  # formula -> black
ws["B5"].font = Font(color="008000")  # intra-workbook link -> green
```

If `B5` instead pulled from a separate file, its font would be red (`FF0000`).

### Rule 2 — number formats

A manufacturing margin line shows revenue, a loss period, a zero, a margin, and a
trading multiple.

BEFORE (base default):
```
Revenue:   $4,200,000.00
EBIT:      -$85,000.00
Backlog:   0
Margin:    0.182
EV/EBITDA: 9.4
Year:      2,025
```

AFTER (conforming format codes):
```
Revenue ($):   4,200,000        -> number_format "$#,##0"
EBIT ($):      (85,000)         -> "$#,##0;($#,##0);-"
Backlog ($):   -                -> "$#,##0;($#,##0);-"
Margin:        18.2%            -> "0.0%"
EV/EBITDA:     9.4x             -> "0.0x"
Year:          2025  (text)     -> stored as text, no separator
```

### Rule 3 — referenced assumptions

BEFORE: `ws["C5"] = "=C4*1.08"`  (8% growth baked in)
AFTER:  `ws["C2"] = 0.08` (blue input, labeled "Growth") and
        `ws["C5"] = "=C4*(1+$C$2)"`

### Rule 4 — source tag

BEFORE: a bare `42.5` typed into the WACC cell.
AFTER:  `42.5` with a note `Source: Company 10-K, FY2024, Page 45, Revenue Note, [SEC EDGAR URL]`.

## Edge cases & exceptions

- An existing template ALWAYS wins. If you are editing a file that already has its own
  color scheme or number formats, match it exactly; do not impose this house style on
  top of an established one.
- A cell that is part input, part formula does not exist — split it: the assumption is
  a blue input cell, the calculation that uses it is a separate black formula cell.
- A hardcoded number that is genuinely a constant of nature (days in a year = 365) does
  not need a source tag, but still gets blue font as an input.
- Percentages that are themselves multiples-style (a 1.0x = 100% coverage ratio) follow
  the `0.0x` rule, not `0.0%`, when labeled as a multiple/ratio "times" figure.

## Do / Don't

- DO color hardcoded inputs blue (`0000FF`) and leave formulas black (`000000`).
- DON'T leave the whole model in one default font color.
- DO render negatives as `(1,250)` and zeros as `-`.
- DON'T render negatives with a leading minus or zeros as `0`.
- DO write multiples as `9.4x` and percentages as `18.2%`.
- DON'T write a multiple as `9.4` or `9.4%` or `940%`.
- DO reference assumption cells in formulas (`=B5*(1+$B$6)`).
- DON'T inline the assumption as a literal (`=B5*1.08`).
- DO state currency units in the header (`Revenue ($mm)`).
- DON'T append "mm"/"$" inside every value cell.

## Common mistakes (base defaults to avoid)

- Setting no font colors at all, so inputs and formulas are indistinguishable.
- Using green/red interchangeably or skipping them — green is strictly same-workbook
  links, red is strictly external-file links.
- Two-decimal currency (`$4,200,000.00`) instead of whole-dollar `$#,##0`.
- Leading-minus negatives instead of parentheses.
- Showing `0` instead of a dash for zero values.
- Writing a year as a number so Excel adds a thousands separator (`2,025`).
- Computing a sum/growth in code and pasting the literal instead of an Excel formula.

## Quick checklist

- [ ] Inputs blue, formulas black, same-workbook links green, external links red
- [ ] Key assumptions filled yellow
- [ ] Currency `$#,##0`; units in headers, not cells
- [ ] Negatives `(x)`, zeros `-`
- [ ] Percentages `0.0%`, multiples `0.0x`
- [ ] Years as text, no separator
- [ ] Assumptions referenced, not inlined; totals are formulas
- [ ] Hardcodes carry `Source: ...` tags
- [ ] Zero formula errors