Finance Automation

When to Excel and When to Automate

Excel often gets a bad rap from devotees of automation. Yes, it’s old school. But there are reasons Excel has remained popular throughout the years, even as more specialized software tools have entered the market.

Financial professionals can use Excel to do just about anything. Accounting teams use it to build reconciliations, create financial models, and dump data from ERPs and other systems for analysis. Since Excel has been around for so long and is so highly flexible, it’s become the common language that accounting departments, auditors, consultants, and tax advisors all speak. And sometimes, Excel is just the best tool for the job.

So how do you know when you should use Excel and when other software would simultaneously speed up your work and reduce errors? The answer can be found by looking at the nature of the task.

When to Use Excel

There’s no need to give up Excel. In fact, we believe abandoning Excel would be ill-advised. Excel is an ideal tool for many tasks, and too many people rely on Excel to simply abandon it. Here’s when using Excel is usually the best choice.

When the Task is Simple to Do in Excel

Some tasks are just easy to do using Excel, and there’s no need to reinvent the wheel. If you’re able to stay efficient while using Excel for certain tasks, keep doing what you’re doing!

When You Need to Collaborate with Other Excel Users

Many financial professionals rely on Excel. If your team tries to force outside collaborators to use a different system, disrupting their existing workflows, you can probably imagine how that will go over. Excel enables people to play well together in the sandbox.

When to Automate

Excel’s strengths (notably its flexibility) can become weaknesses when you take it too far outside what it was designed to do. People sometimes try to get Excel to jump through hoops to work as a CRM or as a financial reporting tool and get into trouble as a result. Here’s when you should look at other tools to automate a process.

When the Spreadsheet Becomes Too Complex

If you’re a financial professional, you’ve seen them — spreadsheets that are unwieldy, if not baffling. They waste time as you try to decipher them, and they invite errors. If your spreadsheets are generating a lot of head-scratching, you’ll want to consider integrating another software tool.

When You’re Spending Too Much Time on Manual Data Entry

A surprising number of companies are manually exporting and importing data from one system to another via Excel. Not only is it difficult to prevent errors in a manual sync, it also can be incredibly time consuming. Automating the flow of data with an integration between applications can eliminate errors and boost your team’s productivity at the same time.

When You Need to Collaborate More Efficiently

Just because you need to collaborate with others who use Excel doesn’t mean you can’t take advantage of what automation tools can offer. You need a solution that works with Excel — that allows your team and your collaborators to continue using Excel for the tasks it’s great at, while allowing your team to operate more efficiently.

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Examples that Translate These Guidelines to Real Life

So, what do these general guidelines look like in the real world? Here are a few examples that offer insight.

Procure to Pay

While you can use Excel for expense reports, it’s not efficient. Employees waste time creating the reports and attaching receipts, and the accounting department wastes time going back to employees whose spreadsheets are disorganized and difficult to navigate or who didn’t provide adequate information.

Teampay eliminates the need for expense reporting. The Teampay software integrates into employee’s existing workflows, taking out the human error factor. It works by issuing secure virtual cards, which employees use for all expenses, and it automatically reconciles all transaction data into your accounting software.

Teampay for Slack Gif

Close Checklist

The monthly close is a complex process. Accounting teams often rely on Excel checklists to make sure everything is getting done properly. But when several team members are involved, the process is complicated. And since team members have no way of knowing when others have completed their portions of the process, the close starts to get messy and often doesn’t complete in time.

FloQast connects your process, people, documents, and reconciliations in the cloud, allowing team members to see who’s working on what and which steps in the process have been finished. FloQast integrates with your Excel workbooks to automate the reconciliations process, eliminating the time previously spent correcting errors. You’ll also know if you’re on track or falling behind with a real-time, month-end close status dashboard, and you’ll get email alerts for unreconciled items, so nothing falls through the cracks.

Reconciliations

Excel works well for reconciliations in the majority of cases. If a specific reconciliation is particularly complex, you may want to use a dedicated reconciliation module in your ERP. Deferred Revenue is a great example. But there’s no reason to abandon Excel for reconciliations that are easy to do in Excel. Close management software, like FloQast, works with Excel to allow you to benefit from automation while still using Excel for core functions like reconciliations.

The Best of Both Worlds

Excel still rules for many tasks, and it’s an important tool for many financial professionals across a variety of industries and functions. But you can absolutely take advantage of what automation can do for your team without losing Excel.

About the Author

Blake Oliver is the Sr. Product Marketing Manager at FloQast, award-winning close management software, created by accountants for accountants to close faster and more accurately. On average, accounting teams who rely on FloQast close three days faster. Seamlessly integrated with ERPs and leveraging your existing checklists and Excel, FloQast provides a single place to manage the month-end close and gives everyone visibility. The cloud-based software is trusted by hundreds of accounting departments, including those at Door Dash, AdRoll, Indeed, LogMeIn, Ancestry.com, Twilio, Dollar Shave Club, Zillow and The Golden State Warriors. To learn more, visit www.floqast.com and join the conversation on Twitter @floqast.