1 Intro to Excel

8/2/2019 1 Intro to Excel

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Introduction toMicrosoft Excel

Pre-Class Material

Copyright 2009 Investment Banking Institute

www.ibtraining.com


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Table of Contents

I. Excel Overview

II. The Basics

III. Formatting

IV. Popular Functions

V. Excel Shortcuts


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Excel Overview

Excel is a powerful spreadsheet program used to store, manipulate,analyze and visualize data

It is the most widely adopted spreadsheet application in the world

Component of Microsoft Office, along with Word, PowerPoint and Access

At its most basic level, Excel provides a way to store massive amountsof data in a structured manner

A single file can contain billions of cells, which can all be linked together

In addition to storage, however, Excel can handle complex mathematicalcalculations, reporting and chart creation

Below are some examples of popular tasks you can accomplish:

Data sorting and storage

Numeric analysis and charting

Financial and statistical modeling

Report generation

Excel is used extensively in investment banking

All financial models, databases, tables and charts are created in Excel


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Proficiency Expectation

Excel is a junior bankers (associate or below) best friend

A very large percentage of your time will spent using Excel

Junior bankers are expected to operate all functions of Excel

without using the mouse Strong Excel proficiency is taught on the job, however, it is

wise to be familiar with the application prior to interviewing ifyou intend to work in this industry

You should be comfortable with the following: Navigation between cells and worksheets

Writing formulas (standard math equations and Excel-specificfunctions)

Cell referencing (i.e. linking cells to one another) Formatting cells (e.g. data and text)

Formatting worksheets (e.g. layout and structure)

Prior to your first IBI class, please practice all of the above

We will be using Excel greatly over the next month


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Table of Contents

I. Excel Overview

II. The Basics

III. Formatting


V. Excel Shortcuts


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Structure

Files in Excel are called workbooks A workbook is made up of spreadsheets called worksheets,

which are organized in tabs at the bottom of each workbook You can insert up to 255 worksheets in a single workbook depending

on your computers memory Each worksheet is structured as a grid, which is comprised of

rows and columns Rows represent the y-axis and are numbered along the left

Columns represent the x-axis and are headed by letters along the top An intersection of a row and a column is called a cell

Cells are used to store and present data and/or formulas Data is expressed in the form of numbers (e.g. 569) or text (e.g.

Hello)

Formulas are used to execute a particular function/calculation orreference another cell or application

Every cell has its own unique identifier or coordinate, which reflectsthe respective row and column it is in For example: cells B12, AJ4, H203

The column letter always precedes the row number


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Layout

CellReference

Box (i.e. A1)

FormulaBox

StandardToolbar

FormattingToolbar

Menu Bar

Row 6

Column D

Cell D6

Worksheet TabScroll Buttons

Worksheet Tabs


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Toolbars

Standard Toolbar

Open Print SpellCheck

PaintBrush

InsertHyperlink

Function ChartWizard

Zoom

New SavePrint

Preview Cut

Copy

Paste AutoSum Sort Drawing HelpUndo/Redo

Email

More

Font Menu

Font Size CurrencyStyle

MergeCells

PercentStyle

CommaStyle

Bold, Italicize, Underline

Right, Center, LeftJustification

Increase/DecreaseDecimal

Increase/Decrease

Indent

Border

Fill Color

FontColor

More

Formatting Toolbar


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Equations, Functions and References

In addition to entering data or text within a cell, you can:

Write equations to perform standard math functions

For example: =5+6, =109/(78-16)^2

All equations must begin with an =, + or - sign The order of operations is in effect

Write special functions to execute a pre-set formula in Excel

For example: =SUM(6,3,8,2), =MIN(9,4), =IF(5+3=8, yes,

no) =SUM( ) --> summation of data

=MIN( ) --> finds the minimum from a set of data

=IF( ) --> conditional statement with a TRUE or FALSE output

For a function to exist within a cell, an = must be the first entry in

the formula box All functions begin with a function name, followed by a set of

parentheses, which encapsulate the inputs required by the function

Inputs are separated by commas (,)


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Equations, Functions and References (cont.)

Create references or links to other cells

For example: =G14

Referencing another cell delivers the output of that cell into theactive cell

Therefore, if cell G14 = 72, then a reference to cell G14 would retrieve thevalue 72

Similar to equations, all cell references must begin with an =, +or - sign

Equations, functions and references are not mutually exclusive

All three (3) practices can be included within one cell

For example: =B16/SUM(5,F67:F78)^3

A colon between two cells represents a range by where all the cells inbetween are also included


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Auditing

Cell referencing is a necessary practice in financial modeling

A workbook with many worksheets may perhaps only have oneworksheet devoted to hard inputs (e.g. assumptions tab) with the

rest comprised fully of links As such, recognizing the flow of data within a model is a very

important aspect of understanding the model

In addition, wrong links are the most common mistakes for an

incorrect model Therefore, Excel provides an auditing tool to track the

relationships between linked cells

Specifically, for any cell there is the ability trace its precedents

and see its dependents

Trace/DeletePrecedents

Trace/DeleteDependents

RemoveAll Arrows

TraceErrors

InsertComment

Circle/RemoveInvalid Data


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Common Output Errors

Below are a list of common output errors users experience

#REF!

Occurs when a cell reference is not valid

Very common when you delete a row or column that contained a cellwith dependents

#N/A

Occurs when a value is not available to a function or formula

For example, using an argument in an array formula that does nothave the same number of rows or columns as the range that containsthe array formula

#VALUE!

Occurs when the wrong type of argument or operand is used

For example, entering text when a formula requires a number or alogical value, such as TRUE or FALSE

#NUM!

Occurs with invalid values in a formula or function

Common in iterative functions, such as IRR or RATE, where Excelcannot find a result


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Common Output Errors (cont.)

#NULL!

Occurs when you specify an intersection of two areas that do notintersect

Often happens if you forget to separate ranges with a comma in afunction

#NAME?

Occurs when Excel does not recognize text in a formula

Common causes are (i) misspelling a function name, (ii) forgettingto use quotations around text within a formula or (iii) using thewrong syntax when referencing other worksheets

#DIV/0!

Occurs when a formula divides by zero or a blank cell

#######

Occurs when the numbers or text displayed in the cell are toolong for the column width


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Common Output Errors (cont.)

Errors are very problematic due to the linked nature of cells infinancial models

A single cell error may carry-forward in a domino-effect into

every dependent cell, either through direct reference or indirectreference

To prevent this from happening, bankers like to use the ISERRORFunction to make sure error cells return useable data

The ISERROR Function returns TRUE if the value is any type oferror (e.g. #REF!, #N/A, #VALUE!, etc.)

=ISERROR(value); is often used in conjunction with IF statements(discussed in further detail in Section IV)

For example: cell B19 = #REF! =IF(ISERROR(B19),0,B19 --> NA

This ensures that if cell B19 is an error, then put 0 in its place,otherwise leave B19 as it is


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Excel Help

Get used to using the Helpmenu (last selection in themenu bar)

It is an excellent resourcefor questions you mayhave

9 out of 10 times, your

answer will be found inthe Help menu

Even a list of shortcutscan be found here

Google is also a greatresource for help withExcel


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Table of Contents

I. Excel Overview

II. The Basics

III. Formatting


V. Excel Shortcuts


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Formatting Spreadsheets

Properly formatting is a crucial skill in investment banking

As a client-oriented business, there is naturally a significant focuson presentation

In addition, because banks solicit investors and/or buyers on theirclients behalf, it is necessary that all materials look clean,organized and professional

It is often said that a good-looking presentation with all the

wrong numbers is actually better than a sloppy presentationwith all the correct numbers

Proper formatting is very important when building models

Formatting adds another layer of distinction to numbers, which in

turn facilitates understanding of the model In addition, a clean and well-organized layout enables a model to

scale better


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Color Coding

Numeric data that is inputted directly in a cell (i.e. notreferenced from another cell) is called a hard input

For example: =5, =5+6 or =SUM(5,6,7)

Cells that contain only hard inputs are always formatted in BLUE This represents standard convention across Wall Street

Cells that contain only reference data are always left BLACK

For example: =H32, =H32+K84 or =SUM(H32:H40, K84)

This represents standard convention across Wall Street

In instances where a cell contains both a hard input and a cellreference, the cell is commonly formatted GREEN

For example: =5+H32 or =SUM(H32:H40,6) There is no standard across Wall Street

This scenario is usually avoided as it is considered poor modelingetiquette to include both a hard input and a cell reference in one

cell


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Formatting a Cell

Cell formatting can be found in the menu bar under Format Highlight one or many cells to format at once

Data should never be left

unformatted unless it is text

Be consistent with decimalplaces

Negative numbers shouldalways be in parentheses

Only the first and totalnumbers should have acurrency symbol in front

Protecting cells, sheets orworkbooks makes theinformation read-only

$5.02.2

3.5$10.7


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Conditional Formatting

Conditional formatting allows a cell to automatically changeits format depending on a specific condition you set

For example: If a cells output is greater than 25, then format itBOLD and PURPLE, otherwise format it ITALICIZED and RED

Conditional formatting can be found in the menu bar underFormat


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Copying and Pasting

Copying and pasting cells is used a great deal in Excel to avoidretyping repetitive formulas or functions

A cell reference that is copied and pasted from one cell intoanother will move its coordinates accordingly (i.e. by the same

number of rows and columns as the cell itself) For example: if a cell is referencing data from a cell 20 rows above

and 11 columns to the left, regardless of where the copied cell ispasted, the cell reference will remain looking 20 rows above and 11columns to the left, the only difference being from a new location

Sometimes, when you copy and paste a cell reference, you do notwant the coordinates to change

Locking a cell reference is called anchoring a cell

You can anchor either just the row, just the column or both

Anchoring a cell involves putting a $ sign in front of the row and/orcolumn you want to lock

=B6 --> =$B6 or =B$6 or =$B$6


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Copying and Pasting (cont.)

When you copy and paste a cell, you copy and paste all thedata and formatting characteristics of that cell

There are instances where you may only want to copy certaincharacteristics, such as just the value, formula or format

Paste Special allows you to pick and choose the aspect(s) youwant to paste

Paste Special is found in the

menu bar under Edit To protect sensitive formulas,

bankers often paste over theirmodels with Paste Special -

Values before they send it toprospective investors or buyers

Paste Special- Formats is alsofrequently used by bankers


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Page Setup and Print Ranges

Get in the habit of setting margins and print ranges when youwork in Excel

Having tables and graphs fit appropriately on a page with pagebreaks in logical places is an important part of formatting

Page Setup is found in the menu bar under File

Print ranges can be set in Page Setup or in Page Break Preview underView in the menu bar


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Table of Contents

I. Excel Overview

II. The Basics

III. Formatting


V. Excel Shortcuts


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Popular Math Functions

SUM Function: SUM(number1,number2,)

Adds all the numbers in a range of cells

AVERAGE Function: AVERAGE(number1,number2,)

Returns an average of its arguments, which can be numbers ornames, arrays or references that contain numbers

MEDIAN Function: MEDIAN(number1,number2,)

Returns the median, or the number in the middle of a set of given

numbers MIN Function: MIN(number1, number2,)

Returns the smallest number in a set of values. Ignores logicalvalues and text

MAX Function: MAX(number1, number2,)

Returns the largest number in a set of values. Ignores logicalvalues and text

l h


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Popular Math Functions (cont.)

ROUND Function: ROUND(number,num_digits)

Rounds a number to a specified number of digits

For example: =ROUND(5.156,1) --> 5.2

COUNT Function: COUNT(value1,value2,) Counts the number of cells that contain numbers and numbers

within a list of arguments

COUNTA( ) --> Counts the number of cells that are not empty

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Popular Statement Functions

IF Statement: IF(logical_test,value_if_true,value_if_false)

Returns one value if a condition you specify evaluates to TRUEand another value if it is FALSE

For example: cell B7=5 =IF(B7 1

=IF(B7 yes

Nested IF statements are IF statements inside of IF statements

For example: cell B7=5 and H4=good =IF(B7 yes

Therefore, if cell B7=5 or H4=good, then the outcome will be yesotherwise it will be no

COUNTIF Statement: COUNTIF(range,criteria)

Counts the number of cells within a range that meet the givencondition

For example: =COUNTIF(range,yes) yes


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Popular Statement Functions (cont.)

AND Statement: AND(logical1,logical2,)

Returns TRUE if all arguments are TRUE and returns FALSE if anyargument is FALSE

For example: cell B7=5; C4=6 =IF(AND(B7,C4)=5,yes,no) --> no

OR Statement: OR(logical1,logical2,)

Returns TRUE if any argument is TRUE and returns FALSE if all

arguments are FALSE For example: cell B7=5; C4=6

=IF(OR(B7=5,C4=5),yes,no) --> yes

NOT Statement: NOT(logical)

Reverses the logic of its argument: returns FALSE for a TRUEargument and vice versa

For example: cell B7=5

=IF(NOT(B7)=5,yes,no) --> no

T bl f C t t


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Table of Contents

I. Excel Overview

II. The Basics

III. Formatting


V. Excel Shortcuts

E l Sh t t


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Excel Shortcuts

As mentioned earlier, junior bankers are expected to operateall functions of Excel without using the mouse

Regardless of how fast you think you are at using the mouse,

divide your time by half and thats how much faster you willbe with just the keyboard

All functions in Excel can be accessed via the keyboard

For example, notice the underlined letter in each title in the

menu bar Holding down the ALT key and the underlined letter at the same

time gives you access to that particular menu

The same method of navigation works for all sub-headers too

Excel has implemented keyboard shortcuts for common functionsand tools to collapse the navigation time even more

Common I-banking Excel shortcuts are on the following slides

Unfortunately, these shortcuts are not designed for Windows Vista orMAC OS

Excel Shortcuts (cont )


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Excel Shortcuts (cont.)

Navigating in Excel Switch between Worksheets CTRL-PageUp/CTRL-PageDownNavigating in Excel Switch between Workbooks CTRL-Tab

Navigating in Excel Move one character up, down, left, or right. Arrow keys

Navigating in Excel Go to end of a contiguous range CTRL-Arrow Keys

Navigating in Excel Select a cell range SHIFT+Arrow keys

Navigating in Excel Highlight a contiguous range SHIFT-CTRL-Arrow Keys

Navigating in Excel Select entire worksheet CTRL+A

Navigating in Excel Move to the beginning of the line. HOME

Navigating in Excel Go To F5

Navigating in Excel Move a Sheet/Copy a Sheet Alt-E-MNavigating in Excel Change Zoom Sizing Alt-V-Z

Entering and editing data Complete a cell entry and select

Entering and editing data ...the cell below. ENTER

Entering and editing data ...the previous cell above. SHIFT+ENTER

Entering and editing data ...the next cell to the right. TAB

Entering and editing data ...the previous cell to the left. SHIFT+TAB

Entering and editing data Delete cell and then get inside the cell BACKSPACE

Entering and editing data Delete cell/selection. DELETE

Entering and editing data

Entering and editing data Edit inside a cell (edit cell mode) F2

Entering and editing data Once inside edit cell mode (F2)

Entering and editing data ...Start a new line in the same cell. ALT+ENTER

Entering and editing data ...Highlight individual characters within cells SHIFT+Arr ow keys

Entering and editing data ...Highlight contiguous string within cells SHIFT+CTRL+Arrow keys

Entering and editing data ...Delete the preceding character. BACKSPACE

Entering and editing data ...Delete the character to the right of the insertion point. DELETE

Entering and editing data ...Cancel a cell entry. ESC

Entering and editing data

Entering and editing data Spell Check. F7

Entering and editing data Insert a comment. SHIFT+F2

Entering and editing data Fill down. CTRL+D

Entering and editing data Fill to the right. CTRL+R

Entering and editing data Undo the last action. CTRL+Z

Entering and editing data Redo the last action. F4 or CTRL+Y

Hiding / Unhiding Rows and Columns Hide the selected rows. CTRL+9

Hiding / Unhiding Rows and Columns Unhide any hidden rows within the selection. CTRL+SHIFT+( (opening parenthesis)

Hiding / Unhiding Rows and Columns Hide the selected columns. CTRL+0 (zero)

Hiding / Unhiding Rows and Columns Unhide any hidden columns within the selection. CTRL+SHIFT+) (closing parenthesis)


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Excel Shortcuts (cont )


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Excel Shortcuts (cont.)

Special characters Press F2 to edit the cell, turn on NUM LOCK, and then press the following keys by using the numeric key pad:

Special characters Cent . ALT+0162

Special characters Pound sterling . ALT+0163

Special characters Yen . ALT+0165

Special characters Euro . ALT+0128

Naming cells, Hyperlinks, inserting time and date Name a cell. CTRL+F3

Naming cells, Hyperlinks, inserting time and date Insert a hyperlink CTRL+K

Naming cells, Hyperlinks, inserting time and date Activate a hyperlink. ENTER (in a cell with a hyperlink)

Naming cells, Hyperlinks, inserting time and date Enter the date. CTRL+; (semicolon)

Naming cells, Hyperlinks, inserting time and date Enter the time. CTRL+SHIFT+: (colon)

Naming cells, Hyperlinks, inserting time and date Display a drop-down list of the values in the current column of a list ALT+DOWN ARROW

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1 Intro to Excel