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By current system

When the workbook has quietly become the system

Every finance function runs on spreadsheets and most of that is fine. The problem is the specific workbook that has stopped being an analysis tool and become infrastructure — the consolidation, the revenue schedule, the WIP report — unversioned, unaudited, and understood by exactly one person.

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Which workbook worries you?

Tell us what it does and who maintains it. We will say whether it is a risk worth fixing.

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Keep the analysis, replace the infrastructureHonest about what to leave aloneLive in weeks
The situationWhat we doQuestions

The situation

Six workbooks that should not be workbooks.

Spreadsheets are excellent for analysis and poor as systems of record. These six are the ones we most often find doing the second job.

The consolidation

Export each entity, paste into a template, apply eliminations by hand. Fine at two entities, fragile at four, a genuine reporting risk at eight.

The revenue schedule

ASC 606 maintained by hand. It is usually not wrong; it is unverifiable, and in diligence those cost the same.

The WIP report

Percent complete, earned revenue, over- and under-billing rebuilt monthly. Your surety and your bank both read it and one person can produce it.

The fixed asset register

Cost, accumulated depreciation, method, and life outside the ledger, agreeing with the trial balance by convention rather than by construction.

The management P&L

Department or project reporting reconstructed each month because the dimensions were never captured at the transaction.

The commission calculation

Frequently the most complex workbook in the company, driving real payments, maintained by whoever built it and understood by nobody else.

The test for whether it is a risk

Not complexity, and not size. Three questions, and if the answer to any is no, the workbook has become a risk rather than a tool.

  • Could somebody else produce it? If your controller were unavailable for a fortnight, would the consolidated statements exist? For most companies with this problem the honest answer is no.
  • Can you reconstruct last March’s version? Not the numbers — the logic. Which formulas, which mappings, which manual adjustments. If not, prior-period figures cannot be defended.
  • Would an auditor accept it as a control? An unversioned file with no change history and no second review is not a control, whatever it produces.
The test is not whether the spreadsheet is correct. It is whether anyone other than its author could demonstrate that it is.

What to replace and what to leave alone

Replace the ones above — the workbooks producing figures that go into statements, to lenders, to boards, or to auditors. Those need version history, review, and a trail from output back to source transactions.

Leave the analysis alone. Scenario modelling, one-off investigations, the pricing model somebody built for a specific negotiation — spreadsheets are genuinely the right tool for those and replacing them with rigid software makes finance worse rather than better. Any vendor promising to eliminate spreadsheets entirely is describing a product nobody wants.

Where to start if it is all of them

Consolidation first if you have multiple entities, because it is the one with the largest downside and the clearest fix. Revenue recognition first if a raise, sale, or audit is on the horizon, because that is what gets examined and priced. WIP first if you are a contractor, because your surety reads it.

In every case the sequence is the same: capture the underlying data properly, produce the figure from that data, and run the workbook alongside for two or three periods until they agree. Cutting straight over is how a bad month becomes an unexplained variance.

Questions

What people ask.

Are you going to tell us spreadsheets are bad?
No. They are the right tool for analysis and the wrong one for a system of record. The distinction is whether the output goes into statements somebody relies on.
We are small. Is this actually a problem?
Often not. A single-entity business with a straightforward revenue model can run a perfectly defensible close with spreadsheets alongside a good accounting system. The risk arrives with entity count, contract complexity, and external scrutiny.
What happens to our existing workbooks?
The ones producing reported figures are replaced by computed reports; the rest stay. We do not attempt to eliminate spreadsheets and would not want to.
How long does replacing the consolidation take?
Three to six weeks depending on entity count and how far the charts have drifted. Most of it is mapping decisions from your controller rather than technical work.
Will our auditor care?
They already do. A key spreadsheet with no version history and no review is a control deficiency in most audit frameworks, and it is the sort of thing that appears in a management letter before it appears in a finding.

Find out if the workbook is a risk.

Tell us what it does and who maintains it. Three questions is usually enough for a straight answer.

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