If you visit enough accounting software websites you would be left in endless confusion as to whether Microsoft Excel is verboten, an essential tool, a necessary evil, or surplus to requirements.
It is indeed surprising that in what should be a prudent and best-practice driven industry, software providers and accountants in business can vary so very much in their Excel opinions and usage.
Ok, I grant you, Fortune 500 companies should not be producing their final accounts in a basic spreadsheet- that is what they have auditors and very expensive accounting software for…but what about activity in the real world long before the final accounts?
Are you a pariah for using Excel to compliment your accounting system or for sharing management reports? Are you less of an accountant? What about processing data through the day-to-day management processes? Can we not draw a distinction between the Auditors’ iXBRL submissions of your final accounts and the essential tools that make your business tick? Are there real risks with Excel, should it be avoided, or at what stage should you be careful?
After 25 years consulting with Irish clients in delivering accounting software solutions I’ve had many occasions to discuss and evaluate the best practice business use of Excel across myriad sectors, businesses, and organisations. I firmly believe there is an important place for Excel in all accounting departments regardless of size or complexity. The accountants “Software Toolbox” can contain several software tools used in harmony to perform their essential role.
However, the key element is in how Excel is used. There is a data processing and reporting train of thought called the “Digital Trail” that should be considered. Excel is a powerful tool when used right, however the critical aspect is that Excel should ideally be used as joined-up part of your digital / data workflow and not in its own fiefdom with manual data entry and no accountability. It should be live and able to refresh directly from your accounting software in real-time and not based on crude data exports from weeks before.
It shouldn’t be its’ own data silo, or an external tool twice removed. The digital trail is the software based digital flow of your data between disparate systems. It’s the linking of these systems allowing the digital flow of your data from one to the other without manual intervention or manipulation. The principle is similar to how data would flow between accounting systems and Business Intelligence software which promotes a proven digital trail of data replication and interrogation.
What does that mean in practice?
Excel should be a powerful window into your accounting data. Ideally it should be able to securely and directly interrogate your underlying accounting data so that there is only one version of the truth. If your fridge can talk to an app on your phone, why shouldn’t you expect your accounting software to link directly to Excel?
The moment your data is exported out as a CSV file, saved, brought into Excel, and manually manipulated, is the moment your digital trail detours to a broken path. Your external Excel is no longer reporting on the same data as your accounting software. You now have separate versions of the truth. You are no longer harmonised.
Using Excel as a tool to display and further query your underlying data is exactly where Excel should be used in all its strength. You should be able to harness the latest in technology to adopt a robust and prudent live link between your accounting software and Excel. Reducing errors and saving substantial time in not having to manually update and manipulate Excel spreadsheets.
At a practical level, we should strive to maintain one source of the truth across your dispersed organisation, otherwise you will have multiple spreadsheets all showing variations of data at disparate points in time, encouraging departmental and management decisions to be made without the right insight.
And how do we live up to that ideal?
Excel is not a bad word. It is an essential part of your accounting toolkit and one that we in ExchequerBMS strongly approve of. We have developed live links to our accounting solutions from within Excel, both the cloud and local versions. We believe in making it easy for users to interrogate their data via live links and queries on areas such as general ledger, projects, stock, customer sales, or supplier interrogations. Create your Excel templates and allow Excel to instantly update your cells with the latest financial data with full accounting data restriction and access control. Excel is a window directly into your extensive accounting data and one that provides accountants and management with the best of both worlds.
We have taken the Excel links one step further even allowing you to drill down from those live cells in Excel to the underlying transactional data within Exchequer without ever leaving your spreadsheet.
Exchequer works hand in hand with Excel, maintaining the one source of the truth across your organisation, and ensuring your digital trail is maintained. We believe in helping businesses become more efficient in their activities and processes using the best tools for the task at hand, in partnership not conflict.
Excel shouldn’t be a tool to overcome reporting limitations in accounting software, it should be a complementary tool used to help efficiently query truly linked data and provide a common arena for extrapolation and management reporting.
For any sized organisation it is essential to be lean and focused, to be able to respond to real time needs and to trust the data being used to make essential decisions inside and outside of your accounting system. This is where our beliefs and approach to a truly integrated Excel usage is far removed from the legacy data silos’ of old reporting concepts.
Do we love it, or hate it? It is truly a subjective choice, however by raising your expectation levels on how you wish your accounting software to work in harmony with your Excel, you can exploit greater benefits, achieve more, and trust more in your data.