Keep your inspectors happy with good & reliable Excel models
Excel is, without a doubt, the most user friendly program in the world for making calculations and that is why you will find Excel models in almost every organization. Nearly a billion people worldwide use Excel; in private situations, with small companies, large companies and with many governmental organizations.
Public Sector: All about our services!
Objections to Excel
Although many people know how to use the program well, using Excel carries serious risks. Especially in the case of more complex models. It is precisely because of the simplicity of the program that mistakes are easily made, and the maintenance and transferability of a spreadsheet are often poor. It is no wonder that the auditors of this world (accountants, internal audit teams, risk managers) often object to the use of Excel for important calculations.
Satisfy your inspectors
To meet the objections of the controllers, there are two things you can do. Either you choose a different solution, for example, programming in R or Python, but not everyone can do that! The ease of intuitive, clear, user-friendly Excel can hardly be matched. Or: you can ensure that your Excel models meet the strict requirements of the inspectors. They expect clear, transferable, well-documented and not overly complex spreadsheets in which no unnecessary risks are taken. To do this, we recommend that you adhere to the following guidelines:
- Train yourself
- Stick to principles
- Document changes
- Check regularly
Only few skills are as underexposed in regular education as the skill of making good spreadsheets. Basically everyone learns to use Excel “on the job”. And it’s possible, because it works so intuitively. However, we often see that it can be done much better. If you’re self-taught in Excel, you don’t know what you don’t know. That is why a training, in which you learn how to continue to work well in the basics, will certainly help you. That even applies to advanced users. PerfectXL’s training not only teaches you the functionality of Excel, but it also shows you how to use that functionality to build good Excel models. If you want to know more, check out our training page.
Stick to principles
Excel is particularly flexible software. An adjustment is easily made. Temporary short-cuts are appealing, especially when there is a lack of time. However, spreadsheets always last longer than you originally intended. Temporary adjustments become permanent and a strict check will certainly expose your short-cut. The rule of thumb is: Always think of the future user. You do this by formulating a set of basic principles about architecture, design, use of certain formulas, etc. Curious which principles we have formulated? You’ll find an overview of our principles for good Excel use here, as well as a free booklet for you to download.
Nothing is more annoying for an accountant than when a model has clearly changed, while it is not clear what exactly has been changed. Of course, keeping track of changes is not the most fun job either. Therefore, look for the combination of manual tracking (with emphasis on the reason for the changes) and automatically detecting actual differences between old and new versions of a model. These differences can be found automatically with PerfectXL Compare.
It is also important to document information about how a model works. What does the model do, where is the input? The calculations? And where can the results be found? Automatic tools can also help with this. Use the PerfectXL Explore tool to get more information about your model.
Did I overwrite a formula somewhere? Am I using the right references? Are there no (old) fixed numbers in formulas? And so forth. Every important model should be regularly checked for errors and risks. That’s what the inspectors expect from you. But, without tools, the control is an almost endless task. How many formulas are there in your model? Fortunately, there are good tools for this task too. It is possible to automatically detect all kinds of risks. It is also possible to visualize a model, so that you can see at a glance whether the flow is running as it should. With the PerfectXL Risk Eliminator you can perform checks on your model quickly and efficiently. Check your models regularly and discuss your audits with an accountant or auditor. Satisfaction guaranteed.