Spreadsheet Woes – Limited Features For Easy Adoption of a Control Framework

Like it or not, regulations are here to stay and for a company to comply with them, its IT and financial systems will have to be equipped with a suitable control framework. One common stumbling block to such an implementation is a company?s over-reliance on spreadsheets.

Why is it so difficult to adopt controls for a system that’s reliant on spreadsheets? To understand this, let’s pinpoint some of the strongest, most powerful attributes of these User Developed Applications (UDA).

By nature, spreadsheets are the epitome of simplicity: easy to develop, easily accessible and easily altered. All computers in your workplace will most likely have them and everyone in your organization may be sharing them, making their own versions, and storing them in personal folders.

Sad to say though, these strengths are also control weaknesses and constitute the very reasons why spreadsheets require effective risk management.

Easy to develop. Being easy to develop, most spreadsheet systems are created by non-IT users who have limited knowledge on best control practices. Being constantly under time pressure, these ?developers? may also relegate documentation, security, and data verification to the back burner in favour of coming up with a timely report.

Easy to access. Information in a spreadsheet can be opened by practically anyone within the organization?s network. Who accessed what? And when? If anything goes wrong, it would be difficult to identify the culprit, and the failure to pinpoint responsibility for erroneous data could lead to bigger, more costly mistakes.

Easy to alter. Lastly, if the information is easy to access, then it can also be easily altered, consequently making reports more prone to both accidental errors and fraudulent modifications.

The rise of multimillion dollar scandals due to accidental and intentional spreadsheet errors have prompted regulatory bodies to publish guidelines for mitigating spreadsheet-associated risks. These controls include:

Change control
Version control
Access control
Input
Security and data integrity
Documentation
Development life cycle
Backup and archiving
Logic inspection/Testing
Segregation of duties/roles, and procedures
Analytics

In theory, these controls should be able to bring down risks considerably. However, because of the inherent nature of spreadsheets, such controls are rarely implemented effectively in the real world.

Take for example Security and Data Integrity. One of the most common causes of spreadsheet error is due to ?hardwiring?. This happens when values are inadvertently entered into a formula cell, naturally changing the logic of the spreadsheet.

As a way of control, cell locking can be applied on the formula cells to prevent users without the proper authority from making any changes. However, when reporting deadlines approach drawing spreadsheets to the forefront of data processing, more people are given access rights to the locked cells. Ironically, it is during these crunch times, when errors are most likely to happen.

Because the built-in features of a spreadsheet support none of the controls mentioned above, some companies are tempted to purchase control-enabling programs for spreadsheets just to continue using them for financial reporting. But although these programs can integrate the required controls, you?d still be interacting with the same complex and outdated interface: the spreadsheets.

Thus, these band-aid solutions may not suffice because the root cause of these problems are the spreadsheets themselves.

Learn more about our server application solutions and discover a better way to implement controls.

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Disadvantages of Spreadsheets – obstacles to compliance in the Healthcare Industry

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Spreadsheet Reporting – No Room in your company in an age of Business Intelligence

Still looking for a Way to Consolidate Excel Spreadsheets?

Disadvantages of Spreadsheets

Spreadsheet woes – ill equipped for an Agile Business Environment

Spreadsheet Fraud

Spreadsheet Woes – Limited features for easy adoption of a control framework

Spreadsheet woes – Burden in SOX Compliance and other Regulations

Spreadsheet Risk Issues

Server Application Solutions – Don’t let Spreadsheets hold your Business back

Why Spreadsheets can send the pillars of Solvency II crashing down

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Shared Services ? Are They A Good Idea

Things happen fast in business and we need to stay on top. It does not seem long ago that some enterprises were still hands-on traders or artisans with a few youngsters to help out. People like that did not do admin and their accounting was a matter of making sure there was enough money in the jar.

When Wal-Mart’s Sam Walton took over his first shop in 1945 things had moved on from there, although he did still deal directly with his customers. When he died his legacy was 380,000 jobs, and a business larger than most economies. So there?s plenty we can learn from how he grew his business.

One of Sam?s secrets was his capacity to centralise what needed gathering together, while empowering store managers to think independently when it came to local conditions. His regional warehouses had individual outlets clustered around them within one day?s drive each. This shared service eliminated 90% of safety stock and released capital for expansion.

Wal-Mart took sharing services a step further in February 2006, when it centralised accounts payable, accounts receivable, general accounting and human resources administration at Wal-Mart Stores and Sam?s Clubs in the U.S. and Puerto Rico. The objective was to bring costs down, while allowing local managers more time to focus on their business plans and other initiatives. As a further spin-off, Wal-Mart was able to integrate its data on a single SAP platform and eliminate significant roadblocks.

This is an excellent example of sharing services by creating own centres of excellence.? Of course, this is not the only business possibility. Other corporates have successfully completely outsourced their support activities, and Wal-Mart has no doubt had a variety of similar offers too. But, is the Wal-Mart picture entirely rosy, or is there a catch?

The Association of Chartered Certified Accountants has indicated that top talent may be the loser globally. This is because the Wal-Mart model removes many challenges through standardisation, and offers less scope for internal promotion as a result. Language and cultural differences may also have a long-term detrimental effect on the way the departments work well together.

Local outsourcing ? this is the business model where several firms engage a shared service provider independently- may hence prove to be a more malleable option for smaller companies. It often makes more sense to hunt down made-to-order services. Offerings such as the professional support we offer on this site.

What GDPR Means in Practice for Irish Business

The General Data Protection Regulation (GDPR) is a European directive aimed at ring-fencing consumer data against illegal or unnecessary access. There is nothing to discuss or debate with local politicians, or the Irish Data Protection Commissioner for that matter. As a European directive, it has over-riding power. To obtain an English version, please visit this link, and select ?EN? from the table of languages.

As you reach for your tea, coffee or Guinness after sighting it, you will be glad to know the Irish Data Protection Commissioner has the lead in turning this into business English we understand. The following diagram should assist you to obtain a quick overview of the process we all have to go through. In this article, we briefly describe what is inside Boxes 1 to 12. The regulation comes into force on 25 May 2018 so we have less than a year to get ready.

The 12 Essential Steps to Implementing the General Data Protection Act

1. Create awareness among your people of what is coming their way. The GDPR has given our regulator discretion to dish out fines up to ?20,000,000 (or 4% of total annual global turnover, whichever is greater) so there is determination to make this happen.

2. Become accountable by understanding the consumer data you hold. Why are you retaining it, how did you obtain it, and why did you originally collect it. Now you know it is there, how much longer will you still need it? How secure is it in your hands, have you ever shared it?

3. Open a communication channel with your staff, your customers, and anyone else using the data. Share how you feel about how accountable you have been with the information in the past. Explain how you plan to comply with the GDPR in future, and what needs to change.

4. Understand the personal privacy entitlement of the subjects of the information. They have rights to access it, correct mistakes, remove information, restrict its use, decline direct marketing, and copy it to their own files. What needs to change in your systems to assure these rights?

5. Issue a policy for allowing consumers access to their information you hold. You must process requests within a month, and you may not charge for the service unless your cost is excessive. You may decline unfounded or excessive demands within your policy guidelines.

6. Adapt to the requirement that you must have a legal basis for everything you do with, and to consumer data. You need to be in a position to justify your actions to the Irish Data Protection Commissioner in the event of a complaint. Having a legitimate interest is no longer sufficient.

7. Ensure that consumer consent to collect, use, and distribute their data is ?freely given, specific, informed, and unambiguous.? From 25 May 2018 onward, this consent will be your only ground to do so. You cannot force consent. Your benchmark becomes what the GDPR says.

8. Issue rules for managing data of underage subjects. This is currently under review and we are awaiting results. Put systems in place to verify age. Set triggers for where guardians must give consent. Make sure age is verifiable. Use language young people understand.

9. Introduce a culture of openness and honesty, whereby breaches of the GDPR are detected, reported, investigated, and resolved. You will have a duty to file a GDPR report with the Data Protection Commissioner within 72 hours, thus it is important to fast track the process.

10. Introduce a policy of conducting a privacy assessment before taking new initiatives. The GDPR calls for ?privacy by deign?, and we need to engineer it in. This may be the right time to appoint a data controller in your company, and start implementing the GDPR while you have time.

11. You may also need to appoint a data protection officer depending on the size of your business. Alternatively, you need to add managing data protection compliance to an employee?s duties, or appoint an external data-protection compliance consultant.

12. Finally, and you will be glad to know this is the end of the list, the GDPR has an international flavour in that multinational organisations will report into the EU Lead Supervisory Authority. This will manage the process centrally while consulting national data authorities.

The GDPR is a project we all need to complete. If we are out of line, it is in our interests to get things straightened out. Once everything is in place, the task should not be too onerous. Getting there could be the pain.

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Energy efficiency- succeed and benefit

Energy is neither created nor destroyed; it is only transformed. This being the law of conservation of energy, and given that the process of transforming energy is inefficient resulting in loss of usable energy in the process of transforming one form of energy into another form, Energy Efficiency finds a home.
Talking of Energy efficiency, think of how much useful energy can be obtained from a system or a particular technology. It is also about the use of technology that requires a lesser amount of energy to carry out the same task.

Energy efficiency is the responsibility of both demand side and supply side. Supply-side energy efficiency refers to a set of actions taken to ensure efficiency through the electricity supply chain. Supply side efficiency measures are about efficiency in electricity generation; be it operation and maintenance of existing equipment or upgrading existing equipment with state-of-the-art energy-efficient generating equipment.

The demand side energy efficiency on the other hand refers to the actions taken to use less/demand less energy. Think of less energy usage in relation to improvement of energy efficiency in buildings, solar water heaters, energy efficient lighting systems such as Compact Fluorescent Lamps, conducting energy audits to identify potential energy saving opportunities, efficient water heating systems and the list is endless.

Success of energy efficiency is a win ? win to YOU-ME-US – the energy consumers, to THEM the energy producers and suppliers and to our precious ENVIRONMENT.
Gain to energy suppliers: – Less energy usage and better energy usage patterns among consumers consequently reduces the customer load which reduces losses on the supply side. Less energy loss creates capacity on the system to serve more customers.

Gain to you-me-us: – Less energy usage and better energy usage patterns Benefits the customer through reduced Electricity bills / $ savings through lower bills.

Benefits to the environment: – Usage of less energy reduces use of fossil fuels, hence reduction in GHG emissions hence conserving our environment. Companies look at means to make rational use of their least efficient generating equipment. The objective is to improve the operation and maintenance of existing equipment or upgrade it with state-of-the-art energy-efficient technologies. Some companies have on-site electricity generation alternatives and thus tend to consider the supply side in addition to demand-side energy efficiency.