Taking Control of Spreadsheet Risk
Diane Robinette, President
April 8, 2014
© 2014 Incisive Software Corporation. All righ...
Objective
2
 Help you understand where spreadsheet risk hides so
that you can have informed conversations with your users...
Agenda
3
 Business Challenges
 Technology’s Role
 Spreadsheet Uses
 Areas of Spreadsheet Risk
 Case Studies
© 2014 In...
4
Companies have spent millions of dollars on enterprise software
TRYING to replace spreadsheets
© 2014 Incisive Software ...
Spreadsheet Uses
5
Simple Calculations “What if?” Analysis
Collect data from
multiple people
Charts and Reports
User Inter...
Spreadsheets: Love Me, Love Me Not
6
• Allows for flexibility and agility
• Does not require IT intervention
• Does not re...
Spreadsheets: Love Me, Love Me Not
7
• Allows for flexibility and agility
• Does not require IT intervention
• Does not re...
Mistakes happen…
8
© 2014 Incisive Software Corporation. All rights reserved.
Bad happens…
9
© 2014 Incisive Software Corporation. All rights reserved.
Early Spreadsheet Technology
10
 1979
 Software ArtsVisiCalc
 Columns and Rows
 Formula command line
 Ran on an affor...
Today: Microsoft Excel 2010
11
 1,048,576 rows by 16,384 columns
 66,530 hyperlinks
 Length of formula contents = 8,192...
Areas of Spreadsheet Risks
 Formula Errors
 Defies Best Practice
 Hidden Information
 Difficult to see
12
© 2014 Incis...
Formula Errors
 Formula Fails to Cover Area
 Inconsistent Formulas
 Data in Formula Range
 LOOKUPValidation
 Currency...
Defies Best Practice
 Constant in Formula
 Forward Reference
 Number Formatted as Text
 Referencing Blank Cells
 Refe...
Hidden Information
 Hidden Rows and Columns
 Hidden Sheets
 Hidden by Color or Formatting
 Hidden by Protection
15
© 2...
Difficult to See
 External References
 Missing External References
 Conditional Formatting
 Reference Named Ranges
 F...
Standardize Spreadsheet Models
17
Company
 Real estate development, investment and management
firm with $24.8B in assets ...
Spreadsheet Governance Program
18
Company
 $1.2B global chemical products manufacturing company
Objective
 Reduce risk o...
Proactive Business Unit
19
Company
 Fortune 10 International Oil and Gas Company
Objective
 Accurate and reliable global...
Contact
20
Diane M. Z. Robinette
President
diane@incisive.com
408.660.3077
© 2014 Incisive Software Corporation. All right...
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How to Take Control of Spreadsheet Risk

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A version of "How To Take Control of Spreadsheet Risk" was given by Diane Robinette, president of Incisive Software at the Los Angeles chapter of the IIA's March meeting.

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How to Take Control of Spreadsheet Risk

  1. 1. Taking Control of Spreadsheet Risk Diane Robinette, President April 8, 2014 © 2014 Incisive Software Corporation. All rights reserved.
  2. 2. Objective 2  Help you understand where spreadsheet risk hides so that you can have informed conversations with your users to:  Improve the quality of spreadsheets  Reduce the time spent finding errors  Implement effective internal controls © 2014 Incisive Software Corporation. All rights reserved.
  3. 3. Agenda 3  Business Challenges  Technology’s Role  Spreadsheet Uses  Areas of Spreadsheet Risk  Case Studies © 2014 Incisive Software Corporation. All rights reserved.
  4. 4. 4 Companies have spent millions of dollars on enterprise software TRYING to replace spreadsheets © 2014 Incisive Software Corporation. All rights reserved.
  5. 5. Spreadsheet Uses 5 Simple Calculations “What if?” Analysis Collect data from multiple people Charts and Reports User Interface to Software Systems © 2014 Incisive Software Corporation. All rights reserved.
  6. 6. Spreadsheets: Love Me, Love Me Not 6 • Allows for flexibility and agility • Does not require IT intervention • Does not require users to change the way they work • Cost of entry is “free” © 2014 Incisive Software Corporation. All rights reserved.
  7. 7. Spreadsheets: Love Me, Love Me Not 7 • Allows for flexibility and agility • Does not require IT intervention • Does not require users to change the way they work • Cost of entry is “free” • Error prone • Possibility for data corruption • No data validation • Security and controls is limited • Cost and complexity increases over time © 2014 Incisive Software Corporation. All rights reserved.
  8. 8. Mistakes happen… 8 © 2014 Incisive Software Corporation. All rights reserved.
  9. 9. Bad happens… 9 © 2014 Incisive Software Corporation. All rights reserved.
  10. 10. Early Spreadsheet Technology 10  1979  Software ArtsVisiCalc  Columns and Rows  Formula command line  Ran on an affordable, personal machine  1983  Lotus 1-2-3  Quickly replacedVisiCalc  1985  Microsoft Excel  Pull down menus  Point and click using a mouse Sources: www.bricklin.com, http://www.dssresources.com/history/sshistory.html VisiCalc v1.0 1-2-3 v1.0 Excel v1.0 © 2014 Incisive Software Corporation. All rights reserved.
  11. 11. Today: Microsoft Excel 2010 11  1,048,576 rows by 16,384 columns  66,530 hyperlinks  Length of formula contents = 8,192 characters  Dependency on a single cell = 4 billion formulas © 2014 Incisive Software Corporation. All rights reserved.
  12. 12. Areas of Spreadsheet Risks  Formula Errors  Defies Best Practice  Hidden Information  Difficult to see 12 © 2014 Incisive Software Corporation. All rights reserved.
  13. 13. Formula Errors  Formula Fails to Cover Area  Inconsistent Formulas  Data in Formula Range  LOOKUPValidation  Currency Error  Complexity 13 © 2014 Incisive Software Corporation. All rights reserved.
  14. 14. Defies Best Practice  Constant in Formula  Forward Reference  Number Formatted as Text  Referencing Blank Cells  ReferencingWhite Space 14 © 2014 Incisive Software Corporation. All rights reserved.
  15. 15. Hidden Information  Hidden Rows and Columns  Hidden Sheets  Hidden by Color or Formatting  Hidden by Protection 15 © 2014 Incisive Software Corporation. All rights reserved.
  16. 16. Difficult to See  External References  Missing External References  Conditional Formatting  Reference Named Ranges  Formulas Reference No Other Cell  Outlayers 16 © 2014 Incisive Software Corporation. All rights reserved.
  17. 17. Standardize Spreadsheet Models 17 Company  Real estate development, investment and management firm with $24.8B in assets under management Objective  Improve the quality of spreadsheet, consistent models Solution  Create “perfect” templates  Deploy technology for Internal Audit to compare spreadsheets to templates and evaluate discrepancies Benefits  Consistent and accurate spreadsheets © 2014 Incisive Software Corporation. All rights reserved.
  18. 18. Spreadsheet Governance Program 18 Company  $1.2B global chemical products manufacturing company Objective  Reduce risk of critical spreadsheets on the organization Solution  Develop spreadsheet inventory to identify top 1000 “In Scope” spreadsheets  Deploy technology for users of critical spreadsheets to scan spreadsheets to highlight risks  Implement internal control: users must scan critical spreadsheets at least once a quarter Benefits  Scalable spreadsheet governance program  Improved spreadsheet quality © 2014 Incisive Software Corporation. All rights reserved.
  19. 19. Proactive Business Unit 19 Company  Fortune 10 International Oil and Gas Company Objective  Accurate and reliable global tax spreadsheets Solution  Deploy technology for global tax users of spreadsheets to scan spreadsheets to ensure spreadsheets are working properly Benefits  Confidence in tax spreadsheets © 2014 Incisive Software Corporation. All rights reserved.
  20. 20. Contact 20 Diane M. Z. Robinette President diane@incisive.com 408.660.3077 © 2014 Incisive Software Corporation. All rights reserved.

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