Access and Excel: Best Friends or Worst Enemies?


By Chris Debo

Every organization, from Fortune 500 companies to small startups, from government agencies to not-for-profits, uses some form of spreadsheet and personal database software. In fact, many organizations would not be able to function without them. However, your organization needs to make sure that it isn’t overly dependent on such end-user applications for data processing, analysis, and reporting. This is not to say that your organization’s use of Access and Excel is an indicator of organizational immaturity: These applications are very good at what they are intended to be used for (simple lists and information-tracking, database applications for non critical enterprise information, quick sorting, and storage/transfer of miscellaneous data). Often, however, Access and Excel are stretched well beyond their capabilities. Numerous research publications, including the Computational Statistics & Data Analysis journal, have reported on the proven hazards of using Excel and Access for complex data consolidation, processing, analysis and reporting. In fact, independent research has even shown examples of how the software itself performs inaccurate calculations when faced with levels of processing complexity beyond its capabilities. In addition to the inherent software risks, there are also risks associated with the control of such documents:

  • Excel and Access applications often bypass the rigorous development, testing and approval processes expected of enterprise applications and required by regulations such as Sarbanes-Oxley.
  • Such files are often stored on public network drives and are not protected against unauthorized access and editing.
  • The space limitations of Excel spreadsheets are often dealt with by simply creating additional worksheets or spreadsheets, resulting in what is otherwise known as “spreadsheet hell.”
  • Data validation is often nonexistent when dealing with Excel and Access, and end-users can be unaware that they might be using inaccurate information.

So how do you know if spreadsheet and personal database use is putting your organization at risk? A good first step is to look at the key controls and applications identified during your external audit/review. Are key business processes (e.g., financial statement consolidations, accrual/reserve calculations, inventory tracking, customer/vendor analysis, management reporting) relying on Access or Excel for data collection, processing and reporting? Also, look at some of the reports being relied upon for decision-making. Are they being generated by your core business applications or is somebody manually producing them from a spreadsheet? Lastly, search your network and personal workstations for Access or Excel files greater than 1MB. You may find files that are supporting business processes that you weren’t even aware of!

If you do determine that your organization is relying too heavily upon end-user applications, consider some alternatives. The reason that many organizations continue to use Access and Excel for critical business tasks is because they either do not have the in-house expertise to identify other methods or they think that alternatives are too expensive. This does not have to be the case. Usually, purchasing additional software is far cheaper than the costs associated with manual processing and maintenance of information in Access and Excel. And if your organization is unsure of alternatives, consult with a local information technology provider or CPA firm that can assess your situation. As your organization continues to grow and become more complex, remember to keep one thing in mind: The deeper you go into “spreadsheet hell” the more expensive it will be to get out of it in the future.

For more information on how properly managing end-user applications such as Access and Excel can benefit your organization’s bottom line please contact Chris Debo of Schneider Downs at 614-586-7219.

Schneider Downs provides accounting, tax and business advisory services through innovative thought leaders who deliver the expertise to meet the individual needs of each client. Our offices are located in Pittsburgh, PA, and Columbus, OH.

This advice is not intended or written to be used for, and it cannot be used for, the purpose of avoiding any federal tax penalties that may be imposed, or for promoting, marketing or recommending to another person, any tax-related matter.

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