Excel is, by far, the most accepted and utilized budgeting tool for organizations of various sizes. Excel spreadsheets are the go-to for budgeting, and often for good reason. However, Excel was never designed for budgeting specifically and so does not have the controls required for an optimal process. When you factor in the problems that arise as a result of such heavy reliance on a system that was never intended for budgeting in the first place, it is easy to see why many organizations are looking for new ways to fix the problem and make Excel better.
Let’s take a closer look at some of these problems:
One of the most common problems with Excel spreadsheets for budgeting is in relation to manual entry. Budgeting is all about the numbers so when your contributors are manually entering many numbers, often late at night, this results in two major issues: errors in data entry and duplication of data entry (a major waste of time). While Excel provides the perfect framework for calculations, it is not intuitive enough to identify those errors or complete data fill-in from a centralized database of information.
Another problem with Excel spreadsheets for budgeting is the sheer volume of them. For example, if you have 10 different departments, all with their own versions, you, as CFO, are required to wade through the various versions to compile a total financial picture. Multiple versions of the same file make it difficult to track and explain the changes between the different versions. Again, the tool limits your ability to accumulate and integrate the data effectively.
Yet another issue with relying solely on Excel spreadsheets is that you’re often dealing with numbers that are outdated. This means that you may be basing critical budgetary decisions on numbers that do not accurately represent your current financial position. Continuous updating (especially when reliant on human input) requires time, and unless that time is spent, you can’t be sure that your numbers are still relevant.
What’s the common denominator here? Intuition. A system that integrates and ‘shares’ information from a central database, thereby removing the need for manual entry (and thus duplicate entries and errors), in addition to merging data as it is entered into that database, means that you are able to extract financial facts as they are needed, in real-time.
As mentioned, Excel spreadsheets for budgeting are ideal as a framework, but an integrated solution that uses the familiar interface of Excel will improve the entire process by making it more efficient.
At True Sky, we understand how critical it is to have numbers that reflect what is actually going on with your organization’s finances and that any decision you make needs to be based on the most accurate, up-to-date numbers. Our solution takes Excel and makes it even better. For more information, please get in touch with us today at 1-905-752-3355.