Investors sign term sheets in expectation that the numbers they see today will hold up under heavier scrutiny tomorrow. A rapid but disciplined check of the model often decides whether a deal team advances, renegotiates, or walks away. Choosing the wrong level of scrutiny can waste precious runway or, worse, create avoidable valuation bottlenecks.

In this blog, we have tried to discuss the differences between model review and audit, and best-case scenarios where they can be used.

What a Model Review Covers

A financial model review is a short-cycle engagement, typically three to five business days, focused on technical hygiene and commercial sense‐checks. Analysts run quality check software to identify potential errors, review calculations, and compare outputs with management’s narrative. Deliverables usually include:

• A summary of critical errors and “nice-to-fix” issues.
• An annotated copy of the workbook with flagged cells.
• A report highlighting the impact of the potential issue on the outputs.

Read more: https://www.fabanalytics.com/model-review-vs-model-audit-the-practical-difference/