Financial modelling is one of the most sought-after but poorly understood talents in financial analysis. In order to estimate a company's future performance, financial modelling combines accounting, finance, and business measurements. In order to forecast a company's financial performance into the future, a financial model is just a spreadsheet, typically created in Microsoft Excel. A three-statement model, which includes an income statement, balance sheet, cash flow statement, and supporting schedules, is required to create the forecast, which is often based on the company's previous performance and future projections. The construction of advanced models, such as discounted cash flow analysis (DCF model), leveraged buyout (LBO), mergers and acquisitions (M&A), and sensitivity analysis, can then be started using the company's historical financial data to forecast its future performance