The Dark Side of Excel Spreadsheet Reconciliations


We all love Excel. Spreadsheets may seem flexible in tracking your accounts data and completing your month-end close process. But do you really know the damage and cost Excel can cause in the month-end close process, to you and your team?

The trouble with spreadsheets

A costly reality is not with Excel itself, but with manual “Excel Spreadsheet Reconciliation’ process. Most businesses must invest a fair amount of time programming and formatting documents to establish the import of data, the formatting during import, and the reorganization so users can start using formulas and functions to perform the Month End Close. This must be followed by testing to ensure correct figures are in place. Another challenge is that spreadsheets are not easily adaptable to suit specific business requirements, and don’t account for changes in business procedures or increased frequency and complexity in transactions. They can also quickly become incredibly complicated and cumbersome to operate and maintain.

Beyond the significant amount of time required in programming your spreadsheets and manually entering financial data, we must also factor in human error. The error rate found in manual reconciliation of accounts is between 0.8% and 1.8. At first glance this error rate may appear insignificant, however if your business processes 100,000 transactions per day that results in 800 to 1,800 errors occurring on a daily basis.

Consider the fines and reputational damage associated with accounting errors. An incorrect keystroke, removal of formatting or accidentally deleting just one cell could corrupt the integrity of the data causing, at best, more time required by your financial team and, at worst, negatively impacting on your financial records and your organisation’s financial standing.

Excel spreadsheet reconciliation errors

New solutions beyond spreadsheets

Some ERP systems eliminate some of the programming work necessary with spreadsheets, and automate the bulk…

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