Worksheet Operation Guides
INTRO
Bul
Practice1
File
Bayes
Bayes5.
Welcome in the depths of the Program. Don’t worry, this is the most single user-friendly tool you've ever seen. It was
the first condition in choosing BASIC programming code—easy for operation, modification maximum displayed and updated capable to every requirements of the day.
Worksheet 1stOpen . When did it, read the introduction framed note and then click "More Information" Button. Read
line-by-line appearing general instruction to enter into the subject matter; remember never try to distribute this Program File, and go to next page by clicking the special buttons only. Click
when appears. (Avoid using sheet
tabs of the workbook to change the sheet. It hamstrings the efficiency of the Program).
Worksheet INTRO . A Sheet introduces the problems of risk only with two sections:
Section 1 is short definitions of the selected types of risks (preferentially prevailing financial Factors), subject of
quantity assessment hereby; and
Section 2 is description of risk matrix double polar coordinate system quantity assessment software program.
When finish, click one of Button "Next " to continue. Then you must concentrate your whole attention!
Worksheet Bul . A Sheet with the two topics:
First Topic is QUANTITY RISK ASSESSMENT
Second Topic is ASSESSMENT OF PERSONALITY TRAITS
Four fields on the screen appear.
 On top-left there are two Charts (you first see only one). This is a visual model
representing a pessimistic forecast of Risk Assessment. Click the Chart or the associated Button “< Click to run personality traits” and you'll see similar Chart
but representing the idea of assessment the traits of an individual who might be
CEO or other senior officer of the managing staff of the Project Company. Scoring of each of the eight Factors are applied on the rectangular axes of two coordinates systems, on 45o reorientation.
Each coordinate axis, however, is with various scales according to the Current Ratio selected by each assessor. It corresponds to the second quantity assessment parameter of material effect over the result. It incorporates at least two
very important components: (i) the real impact of this Factor over the outcome of the system, and (ii) the prior probability values for specific events of interest that can possibly occur. The computed final level of the risk referred to the
sum of the areas calculated through sums of sub-triangles    . To recognize said triangles look their notifications by the alphabetic names of the axes l ; d ; e ; c ; and i ; o ; p; b; and the center of both coordinate systems 0.
Check Box (ActiveX Control) for upgrade the Scoring of Risk Factor “l ”
On bottom-left is the Main Operating Matrix. It contains Columns Factor, Scoring, Current Ratio, Extent, , Relative Level, Critical, and Ratio.
① Fill in Scoring Column to assess the relevant Risk Factor. You can do that by
selecting the desired value 1 to 10 through the ActiveX Spin Button, and then
click the respective Factor's Button to enter the value into the cell on the right.
Repeat that for each Factor.
② In case Investor has not cash (15% own funds) for participation in credit transaction with front payment and will borrow them or an angel investor will pay
them, that significantly increases the Lender’s Capital Risk Factor “l ”. An average of 1.2, is added to the Scoring of this Factor when the Check Box (ActiveX
Control) is active.
③ Similarly, fill in input data the Ratio Column. However, the Factor's Current Ratio value 1,00 to 2,00 is selected first
by Scroll Bar on the right and then as you click the respective Ratio's Button to enter it. As far as there are some
specific events of interest for a Factor that might have significant impact over the outcome of the system operation,
often the assessors TEND TO RAISE the value of most of the Ratio. In order to escape such a deformation of the expertise, we involved 1 Ratio. Critical value, and Quotient of the permissible exceeding of selected Ratio of a Factor by an assessor – on next Sheet Practice1 (to be discussed later). Anyway, every assessor has an option to select
his or her personal Critical Value corresponding to his of here assessment of the impact of this very Factor over the
final total level of the Project’s risk. Both numbers, Scoring and Ratio, are multiplied this fix the value if the respective Risk Factor.
So, the project (a business venture) Risk Assessment, made by one single internal expert, outside assessor, auditor, through this Program, is the sum of quantity assessment of eight Risk Factors, where each one is multiplication of two numbers—(i) general Scoring of the risk and (ii) its specific impact over the analyzed investment project or business venture due to prior probability estimates for specific events of interest.
 On bottom-right there are brief sample instructions suggesting how to select the appropriate Score for each Risk Factor depending, but not limited to, on type of investor.
 On top-right is (A) the field where you’ve to indicate the Name of Project, and (B) a Graph that visualizes the selected
assessment of both Scoring (1:10) and Ratio (1:2). On the Y-axis is marked the selected critical value  (in this case
equal to 1.2) selected by an assessment maker.
④ To indicate Name of Project you will either select it from the drop-down list of already analyzed, or write it for the
first time in the marked filed, wherefrom when you Enter it, the name automatically goes to one row up and files into the List of Projects (Sheet “List”)
Click “Practice1” Button or
on the bottom below the matrix. (Avoid using sheet tabs of the workbook to change the sheet. It restricts the effect of the Program)
Worksheet Practice1 provides opportunity to safe your work in a similar sub-matrix and to operate with it. Assessment
made by everybody is forwarded automatically to ”OPERATING FORM” in the same size, shape and configuration as it
was in the Main Matrix on previous Sheet “Bul”.
(If you use CONSUMER-ORIENTED VERSION, only the seven sub-matrixes of Group A is are capable for operation.)
⑤ From this position the information will be manually forward to any sub-matrix on this Sheet and saved for further
processing. It happens when you select an appropriate sub-matrix and click its Button “Complete”. However, as an INSIDE EXPERT, you are one of the Group A and must select one of the seven sub-matrix in the first line. It could be clean
or completed (the content will be exchanged, however it’s better to clean it up in advance as click the affiliated
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Personal Code
Button ). Your Code # will be one of 1 002 to 1 008 and after successful completion it
turns red. The figure below it turns from “0” to “1”. This data block goes automatically to archiving on Sheet “File” where each data is respectively pasted in the first empty available row at the
bottom of the Table. To clean up all sub-matrix click the red Button on the top-left corner.
If you’ve purchased the full version of the Program, then:
EXTERNAL ASSESSORS form Group B complete sub-matrixes on the second line;
INDEPENDENT AUDITS form Group C complete sub-matrixes on the third line;
QUALITY ASSIGNMENT from Group D completes two examinations: (i) “what-if” expertise, designed for refining of the Default Risk (d ); and (ii) Personal Traits of up to eight managers of the
Project Company to reform the Operational Risk (o ).
Obviously, there are two risk Factors of special interest, and they are bolted above and in the submatrixes too.
Alarm sign
You need this audit when you’ve to add credibility through your final assessment to what you’re trying to achieve.
Such a need arises in case of significant difference(s) between the Ratio of one Factor (usually l or d ) and the rest.
⑥ For ordinary analyzing you can select one of the two critical values, embedded in the Program code. Point the mouse
on one of the Option Button (ActiveX Control)  SELECT on the bottom-leftmost part of the Sheet. The selected
Quotient 1.2 or 1.4 multiplies the default Critical Ratio (=1). When thus or otherwise the result is an increase of at
least one value of the Ratio Column of all matrix over the product of above both Quotients, a particular sign bomb
with lit fuse  appears and remain below that Column(s) alarming over reality value(s). This by other words, means
that the Project Company’s future in this business will be in jeopardy. Hence, YOU NEED HIGH QUALIFIED AUDIT
GROUP TO ADD CREDIBILITY TO YOUR FINAL ASSESSMENT. This statement appears above the Group D line of submatrixes.
⑦ Make visual analysis of the information in the Table is in this unique Matrix, containing 32 sub-matrixes (including
the first one, called “OPERATING FORM”). Each of the four group’s row contains computed Total Average Level of
Risk independently are or aren’t completed all sub-matrixes. Finally the Cell AN46 represents the Total Level of the
Risk, computed for Groups A+B+C Average. The charts on top show: the first—average computed risk of each so
called (A) expert, (B) assessor, (c) auditor and/no (C) high qualified professionals, belonging to the respective Group,
assigned to audit the above assessments; the second—percentage distribution of each group in the total result. Now
the decision maker can decision how to proceed with the forthcoming business venture as superpose his or her very
private opinion over the results in the Matrix.
⑧ On the bottom of the Spreadsheet is the section of Group D sub-matrix with an ActiveX Control scroll bar and graphic applications. Group D is paired for double meaning and purposes. (i) If you chose RISK ASSESSMENT mode on Worksheet Bul , then Group D consists of risk assessors of the auditor for due diligence. (ii) However, you are going to
evaluate PERSONALITY TRAITS of decision maker and chose this mode instead, assign this assessment to the coordinator of the members of the panel of experts, who are physically separated from and unknown to each other.* Each of
them separately has first to Score the eight factors as individual behavior criteria, and then to select Ratio in compliance with a conceptual scenario for specific events of interest based on a well-defined set of assumptions.
⑨ Said conceptual scenario includes adjustment and improvement of behavior for mitigation of the Risk Factor . Move the slide of ActiveX Control scroll bar on bottom right of the Sheet to set the Ratio of impact
of the assessed personality traits over the Factor
, and its relative part in the total risk. First prior probability estimates for specific events of interest is over.
*
Author and the Program provider is in position to propose such panel of experts including coordinator, if the case so ewquires.
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⑩ With this Program you can practice posterior probabilities, i.e. to exercise
. This
is
designed to provide general guidelines to do it. From the above analyses in life of the loan (or another fixed period
of operation of the business venture) discussing conditional probability it is expected the managers (decision makers) to revise probabilities given new information. With this information, on a next upper-level of a well-defined set
of assumptions, and in compliance with a updated conceptual scenario by the coordinator, the panel of experts may
repeat the above described procedure as many times as the case requires. Thus the “bases” of the total risk is
reduced. This process is displayed in pyramid in the right when, on the Program Spreadsheet, with the reduction of its size together with the decreasing of the impact of Factor
over the total level of the risk. Per se,
-impact may drop, as is commonly said, with up to 95%.
⑪ Worksheet File . Click Button “To Sheet File”
if you need to refer previous assessments. (Avoid using sheet tabs
of the workbook to change the sheet. It restricts the effect of the Program)
⑫ Worksheet Bayes . When in the above expertize, predominating about Default Risk (d ), but not limited to, occurs
prior probability that have revoked higher than critical value of the Ratio multiplied by the selected Quotient (the
alarm sign appeared), a correct assessment requires assignment of HIGH QUALIFIED AUDIT GROUP TO ADD CREDIBILITY TO YOUR FINAL ASSESSMENT. The auditors collect new information from samples, or request for special report, or product test of the system output, etc. in order to revise or update the prior
probability value and to define an events referred to as posterior probabilities. They can
be computed by means of Bayes theorem. This is a sensitivity analyzes of posterior probabilities, that should be later applied in the Business Plan, provided the Decision Maker
decides to accept the risk and continue development of the project.
⑬ Fix an event of interest following the supplied goods of services, depending on the nature of the business venture,
by two sub-contractors.
⑭ Complete the percentage of Good quality of both A1 and A2 supplies (subcontractors), and the percentage of the A1‘s
quantity from the total supply. (For the Master Model they are respectively 98%, 95% and 65%). Posterior probabilities of
Bad events will be compute respectively for both of them, and the overall probability of happen Bed event (For the
Master Model it’s equal to 3.05).
⑮ The Name of Project was entered automatically, but you don’t forget to write the Event of Interest you’ve
already fixed. You’re done.
Note. The Program re-computes d -Factor’s Ratio [Cell D15, Sheet “Bul”] with the impact of the received overall
probability of happen Bed event over d pro rata, note - of the difference from the assessed Ratio up to maximum
allowable Ratio (2), fixed for every Factor. This way a posterior probability, appeared from the analyses of the influence of new over the historical information by special professional team of experts (Group D), the assessment of this
Risk Factor d ) objectively increased.
For easier operating with the Program amongst other gears, you’ve one that clean the Table prior to start a new
analyses. Click Button “Clean Model”.
- On the bottom of the Sheet there is Table of RECORDS. Click “Save Events” Button.
For more than two events following delivery of goods or services by Suppliers (Subcontractors) go to Sheet
“Bayer5”. Click one of the Buttons “5 Events”. (Avoid using sheet tabs of the workbook to change the sheet. It restricts the effect of the Program)
⑯ Worksheet Bayes5 . Decision Analyses may require computing the impact of Default Risk (d ) over the total level of
the risk for a business venture when the history information leads to more than two mutually exclusive events of interest. Just complete the empty cells.
⑰ When you finish, return to Sheet Bayes as click the Button “See Comments” to make better sense of the results.
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