Budget control with Prophix? or use a spreadsheet?

January 26th, 2011 by Stephen Jones Leave a reply »

In many cases, small-to-medium-sized businesses and some large-sized businesses still manage the difficult and error-prone process of budgeting on spreadsheets.

 Excel’s capabilities are often inadequate to support the critical nature of budgeting and forecasting and auditors are often sceptical about the accuracy of  self created tools.  typical issues are: version control, complex macros, formula errors, and inability to easily draw in and consolidate input from needed participants.

A recent whitepaper from BPM Partners reveals a best-practice approach to move beyond spreadsheet-based budgeting.

Warning Signs That Your Budget Process Has Outgrown the Spreadsheet:

  1.  No single version of the truth
  2. Ownership and accountability by business users have disappeared
  3.  Time-consuming setup of financial statements

Breaking the spreadsheet habit is a difficult step , and finance executives often postpone the decision to migrate to a more purpose-built budgeting solution.

Step One: Acknowledge That You Have a Budgeting Problem

Good budgeting practices are structured to minimize errors and inconsistencies, drawing in all the necessary participants to contribute their business experience and the unique perspective of each department. Best practice in budgeting entails a mixture of top-down guidelines and standards, combined with bottom-up individual knowledge and experience. There comes a point when a company’s reliance on spreadsheets for budgeting becomes an impediment to effective decision-making and analysis. Spreadsheets can accommodate many tasks – but, over time,the models running in Excel grow too big for the spreadsheet application. When companies regard budgeting as a key business process, it becomes more apparent that it should be separated from the idiosyncrasies that spreadsheets allow.

It is common for spreadsheet budget models and their intricacies to be known and maintained by a single person who becomes a vulnerability point with no backup. . Data confidentiality is almost impossible to maintain in spreadsheets, which are not designed to hide or expose data (i.e., payroll) based upon each user’s role. These are drawbacks for corporate governance and make the audit process more difficult.

2. Ownership and accountability by business users have disappeared, and control over consolidating the

Watch the 8-minute PROPHIX online demo to see a complete end-to-end Performance Management solution for budgeting, forecasting, reporting, consolidation and personnel planning in action.

Synergy Software Ssytems is the Certified implementation partner for this region

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