Setting Global Sensitivity Analysis Options

  To set the full model options for sensitivity analysis:

1. Access Sensitivity Analysis.

   See Accessing Sensitivity Analysis .

2. Select Full Model.

3. In Sensitivity of, select an account for analysis.

   Default: Net Income (v1750.00.000)

   Note:

   Accounts using scalar inputs or historical average forecast method are not listed. Accounts using Freeform Formulas sensitive to other accounts are included.

4. In In period, select a time period.

   Default: the first forecast period

   Note:

   You can select aggregate time periods only when you select Multiplying By in the Change by field.

   Exceptions

   This becomes All Forecast Periods when you select one of these accounts in the Sensitivity of field:

   • SVA Variables

   • EP Variables

   • DDM Variables

   • Cum. PV of Cash Flows

   • Cum. PV of EP Cash Flows

   • Cum. PV of Dividends

   • PV of Residual Value

   • PV of EP Residual Value

   • PV of Equity Residual Value

   • Corporate Value

   • EP Corporate Value

   • Estimated Equity Value

   • Shareholder Value

   • EP Shareholder Value

   • Equity Value per Share

   • Shareholder Value per Share

   • EP Shareholder Value per Share

     Relative variables in forecast time periods change to calculate the sensitivity of the valuation account.

5. In Display as, define how values are presented:

6. In Relative to (top), select the item on which the sensitivity of the item in Sensitivity of is determined and the calculation based on.

   Enter information for the first account variable that is changed. This appears on the matrix.

   • Account

     Select the top variable of the matrix on which the sensitivity is performed.

     Default: Sales (v1000.00.000)

     The list includes all accounts from the model, plus:

     • Input accounts with no freeform formulas

     • Input accounts with freeform formulas using @input

     • Main accounts calculated as a sum of their subaccounts

     • Subtotal subaccounts

       Default: Weighted Average Exchange Rate

     • For accounts calculated through subaccounting and subtotal subaccounts, the increment percentage applies to the subaccounts' output values. Using these accounts, you must select Multiplying by in the Change by field.

     • Calculated accounts such as Net Income are not included.

   • Change by

     Select a method for changing the sensitivity variable:

     • Adding

       Add the change amount to the input value of the relative variable. The change amount is based on the input type and scale of the relative variable. For example:

       • An increment of 3 for A/R, if it is forecast in Days of Annualized Sales, adds 3 days to the input value of A/R.

       • An increment of 2 for Sales, if it is forecast as a Growth Rate, adds 2 percent to the input value of Sales.

       • An increment of 5 for Fixed Capital Investment, if it is forecast as Actual Value in Millions, adds 5 Million Dollars to the input value of Fixed Capital Investment.

     • Multiplying by

       Multiplies the input value for the Relative to account by a percentage. For example:

       • An increment of 2 for Sales, if it is forecast as a 10% Growth Rate, multiplies the input value of 10% by 2%, equalling 10.2%.

   • Change Amount

     Enter the amount multiplied by or added to the Relative to account. The maximum is 999.9. You cannot enter negative amounts.

     Examples:

     • If you enter 2% for Sales Growth Rate and select Multiplying in the Change by field, Strategic Finance multiplies the Sales Growth Rate by 98% to obtain the -2% result and multiplies the Sales Growth Rate by 102% to obtain the +2%.

     • If you enter 2% for Sales Growth Rate and select Adding in the Change by field, Strategic Finance adds or subtracts 2% to calculate the results. So 10% becomes 8% and 12% growth rate.

   • Forecast

     Displays the forecast method of the Relative account.

7. Optional: To add another sensitivity variable, in And Relative to (left), select an .

   To perform a sensitivity using a second variable, enter information about the account (it appears left of the matrix). Complete the fields as you did in the Relative to fields.

   Note:

   The default account is Period End Exchange Rate unless you have saved another setting.

   You cannot the select the same account for both relative variables.

   To only perform an analysis using one variable, enter a zero for the change amount for one of the relative variables.

8. Click OK.