What typically results from ignoring timing in financial models?

Ignoring timing in financial models leads to misleading conclusions because timing plays a crucial role in financial performance, particularly in areas like cash flow, profits, and valuation. Financial activities don't occur simultaneously; rather, they happen at specific points in time, and failing to account for this can distort the analysis of how investments perform over various periods. For instance, two cash flows of the same amount may have drastically different impacts on the net present value (NPV) or internal rate of return (IRR) depending on when they occur. If a model does not properly factor in the timing of cash flows, it may suggest that an investment is more or less attractive than it actually is, leading to potentially poor financial or investment decisions.

The other options do not accurately reflect the consequences of ignoring timing in financial models. Accurate forecasts and improved cash flow analysis inherently require attention to timing to be valid, and enhanced investment strategies are built upon precise modeling that includes timing considerations.