NEW RESEARCH POINTS TO SYSTEMIC FAILURE OF SPREADSHEET RISK MANAGEMENT WITHIN UK ORGANISATIONS
· 72% said that no department checks their spreadsheet
· 56.5% have not received formal spreadsheet training
London 6, June, 2011 A new survey* from ClusterSeven, an international provider of strategic spreadsheet and data management software, shows that 56.5% of spreadsheet users have never received formal training on the spreadsheet package they use. Worryingly, 47% have never even been offered spreadsheet training.
Of those surveyed by ClusterSeven, 72% admitted that no internal department checks their spreadsheets for accuracy. Only 12.9% said that Internal Audit reviews their spreadsheets, while a mere 1.1% receive checks from their risk department.
Spreadsheets enable organisations to quickly and flexibly perform analysis that would otherwise be difficult or time consuming, says ClusterSeven. As a result, businesses tend to place undue trust in the integrity of the analysis captured in their spreadsheets.
Ralph Baxter, CEO of ClusterSeven, said: “This research is a clear indication that organisations are systemically failing to properly control the way in which spreadsheets are being used and managed. Over the last number of years, high profile cases have brought spreadsheet usage to the forefront of organisations risk management procedures, but unfortunately governance has yet to catch up.. Organisations need to understand the risks they now face, and not when a serious financial error has arisen.”
Further research by ClusterSeven has shown that 47.2% of users made between one and four errors on their spreadsheets, while 11.6% made between five and 10 errors. Shockingly 6.6% made more than 11 errors following the construction of their spreadsheets.
Ralph Baxter continued: “It is clear that the prospects for serious errors occurring within spreadsheets are very likely, with over 65% of interviewees admitting to making mistakes. This is extremely worrying considering that organisations rely on carrying out business critical data processes using this tool, which some cases involve millions of pounds in transactions.
“Currently no department is charged with reviewing and securing spreadsheets, leaving this process entirely in the hands of the end-user. As our research has shown, this needs to change, with one department charged with maintaining policy for the review and security of all business critical spreadsheet usage. This can be carried out cheaply and effectively with the tools readily available, coupled with user training and individual risk assessment of spreadsheets.”
*Research carried out in May by Consumer Intelligence, with 1498 interviewees.
ClusterSeven (London and New York) provides enterprise-wide, strategic spreadsheet and data management software to financial institutions and Fortune 500 financial reporting divisions. ClusterSeven’s software non-intrusively monitors and tracks spreadsheets to enable users to more effectively manage governance, risk and regulatory compliance obligations in order to generate revenue, enhance staff efficiency and boost productivity. For more information about the company, visit www.clusterseven.com. For a demonstration please visit Get Started.