Seven tips to develop a structured model

Create A Modular Design For Your Model

Don’t put everything on a single worksheet. Separate your model’s components on multiple worksheets, i.e. Revenues, COGS, Other Costs, Financing, Amortization etc…

Keep Your Sheet Names As Short As Possible

It will help keep formulas legible and you’ll see more sheet tabs at once which will help browse within the workbook. If you’re using external links, keeping filenames and folders short might also be a good idea.

Note that there is a 1024 characters limit per cell. Thus, long sheet names or file names might enable you towards exceeding that limit.

Put Headings On Top Of Each Worksheet

Keep a few rows on top of each sheet to identify what’s on the sheet. I often use these titles: company name, workbook description, worksheet description.

Create Sub-Section Labels

Make the outline obvious by indenting sub sections. You can use the indent functionality or use separate columns (i.e.: column A for titles, column B for subtitles, column C for elements)

If you have many levels or if the worksheet is tall long, you might want to number your titles (i.e.: 1.2.2.b)

Standardize Cell Formats

… and minimize the number of different styles used (font, font-size, colors, borders, etc…). It will be much easier to read and visually more beautiful. You should also remove those gridlines.

Identify inputs

Use a distinct format for inputs to help users quickly identify controllable elements. This is very often a missing item in models. If you had to use only one tip, this should be the one.

Be consistent

Have a common structure throughout every worksheets. Use the same columns and rows for your labels and always keep the same period in the same column. It will be easier to follow and will also facilitate formula construction or auditing (e.g. see formula in the next picture)