4. Characteristics of spreadsheet applications

'Features' explained in the previous page are the fundamental things that make a spreadsheet a good choice for financial modelling

'Characteristics' are the fine details of a particular spreadsheet package that make life easier for you.

Here are some useful characteristics of a good spreadsheet package

- Can sort data: good for making it easier to find individual data

- Absolute and relative referencing: makes setting up formulas easier

- Can protect certain cells from change: Handy to make the model more robust

- User interface forms : Excellent to load input values into the model

- Macro language support: Allows complicated subroutines and functions to be written

- Automatic re-calculation : Makes the model respond very quickly

- Conditional formatting : Highlight certain numbers of interest such as a profit / loss

- Import / Export support : Easy to load input values in one go and save output values

- Searching and filtering : Very good when looking for specific data in the model

- Lookup tables : Used extensively in modelling to store values

- Pivot tables : Very powerful tool to summarise a huge amount of data into one table

- Pivot charts : Very powerful way of seeing the effect of running 'what if' questions

- Replication : Easy to create a list of values by simply dragging down in a certain way

- Database lookup : Can connect to external databases to get values

- Worksheets supported : Very good for splitting up parts of the model

- Graphing : Pie-charts, Bar charts etc each good for presenting data in a different way

You can expect any spreadsheet software package to include the 'Features' but it is the characteristics of each package that helps you choose which one to use / buy.