Finance departments are still using spreadsheets to manage multi-million pound business budgets. This is not only outdated but also fatal for the company.
Sebastian Dewhurst Founder of EASA explores why CFOs should stop relying upon unsecured Excel documents to manage their budgets.
The Cost of Convenience
Excel is the native finance language. Its flexibility and ease-of-use make it a vital tool for finance teams and CFOs around the world. Spreadsheets are attractive, but they can also be risky to use when managing critical financial data. Spreadsheets are still used by many organisations in various sectors to make decisions.
75% of CFOs rely on Excel heavily for planning, forecasting, and reporting. * The majority of these spreadsheets are stored on shared folders and local drives, without version control or audit trails, and with little to no security .”
Spreadsheet Disasters
The risks are not theoretical or conjectural; they are real, and expensive. Over the years, spreadsheet mismanagement has led to significant incidents. Norway’s SWF 2022 incident is one example. An incorrect data entry in a spreadsheet was used to balance Norway’s $1.5billion Government Fund Global. This led to NOK980million ($92million) of funds being wrongly allocated.
This isn’t a single-off event. Spreadsheet mistakes cost businesses millions of dollars each year. Due to their ease of use, many of them are not noticed until it is too late.
The Financial Limitations of Excel
It needs to be clarified. Excel plays a vital role in finance. Excel was never designed to be a financial system for enterprises because it lacks core features like access controls, compliance checks built in, and many other features. Spreadsheets can struggle to keep pace as departments grow and change processes. Spreadsheets can become prone to errors such as inconsistent logic, overwriting, and siloing data.
“These mistakes can not only cause operational damage, but also legal risk in industries or companies that have high regulatory standards.”
Excel and CFOs: A toxic relationship
Why do finance leaders, CFOs and other financial professionals still rely on spreadsheets to manage their finances? Accessibility, flexibility and price are often the main reasons. The flexibility of the software allows rapid scenario planning, modelling and custom calculations. Traditional enterprise resource planning systems (ERPs) cannot handle these tasks without a significant investment.
While implementing these tools can seem expensive and disruptive, they are insignificant compared to the reputational and legal damage caused by a single spreadsheet mistake. This level of inaction is unacceptable.
CFOs should ask themselves: “Do we protect our financial data or do we simply accept the risk?”
Elevating the Future of Finance with Low-Code
“The solution doesn’t lie in eradicating spreadsheets overnight. It’s about accepting their limitations and integrating them with tools that are designed to meet the needs of today’s business environment. No-code platforms are a better option for finance teams going forward.
These tools combine the flexibility of spreadsheets with the security, scalability, and structure of enterprise software. This includes automated workflows and role-based access. Version control is also built in. These platforms are often fully compatible with Excel. This means CFOs do not have to throw away years of institutional logic or models. They can also import existing formulas and maintain familiar interfaces. This allows them to build on what is already working, while gaining access control and version management.
These features enable finance departments to improve teamwork and reduce risk without sacrificing agility.
Next Step for CFOs
To address these issues CFOs need to start auditing the way their teams use spreadsheets. This is especially important in high-risk environments or those governed by regulations. Then, they should explore modern finance technology that can replicate the speed and customization of spreadsheets while establishing guidelines.
“The final change needed by CFOs is a cultural shift. They need to equip their teams not only with the right tools but also the right mindset in order to move toward more sustainable and scaleable solutions.”
References:
*www(dot)datarailscom/power-bi-vs-excel-for-fpa/#:~:text=Excel:%20The%20Main%20Things%20to,In%20a%20nutshell%20Excel%20is:
*www(dot)bradfordera(dot)com/2025/02/12/90-of-firms-still-rely-on-spreadsheets-despite-bottlenecks/
The first time this post appeared was on Human Resources News.
