Almost submitted a WACC calculation with inverted debt/equity ratios during a mock interview – need failsafes. Heard about a ‘Red Flag Checklist’ vetted by working pros to catch errors quickly. What specific items do you check first when sanity-checking models under time pressure?
‘red flag checklist’ lol just say u want someone else to do ur work. heres mine: 1) does ev/ebitda make sense for the industry? 2) did u forget to unlever beta? 3) is fcf higher than ebitda? if yes, ur wrong. congrats u passed
omg yes need this! my last model had negative terminal value…embarrassing. pls share checklist items!
Top 3 red flags: 1) Implied EBITDA multiples outside industry norms, 2) Unlevered Beta exceeding 2.5 or negative, 3) CAPEX > Depreciation in perpetuity. Always check these before discussing outputs. Pro tip: Flagging your own assumptions preemptively demonstrates maturity.
Mistakes mean you’re learning – soon you’ll catch errors like a pro! 
My analyst buddy shared his ‘oh shit’ checklist after I messed up a DCF. Now I scan for declining margins paired with positive growth rates – saved me twice last month!
Data from 112 failed interview models shows 63% errors stem from incorrect tax rate application or perpetuity growth >5%. Recommend a 4-point check: 1) Tax rate consistency, 2) TV vs. explicit period ratios, 3) Working capital sign, 4) Debt repayment schedules impacting FCF.