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Exact, precise, and accurate – no matter which of these you prefer to use, the meaning is the same. You want the numbers you report to management to be flawless. There are many reasons why CFO’s, finance managers, and controllers choose to consolidate in Excel. However, with 90% of Excel Spreadsheets containing errors, flawless is unfortunately not one of them. Instead, the most common reason to continue to use Excel are:   

  • “Everyone in my finance functions understands the software.”
  • “The program is accessible to all no matter where you are in the world.”
  • “I can create my own spreadsheet with my own formulas.”
  • “It is easy to manipulate the data.”
  • “We are an SME without complicated calculations.”

This is not saying that finance professionals should not use Excel; however, it is essential to investigate the benefits and limitations of using the well-known software for audit required processes, such as consolidation.

This checklist is to help group finance professionals to determine their consolidation needs and how well they match Excel.

Is Excel bringing value to all the tasks I’m applying it to? 

With everyone in finance understanding and using Excel daily, sticking to excel purely out of habit is a real risk for tasks that can be handled in Excel but should be handled elsewhere. No matter your skill level in Excel, efficiency, time, and trust in your numbers need to be on top of your mind in all finance deliverables to ensure that you are not sticking to excel out of habit.

Some of us still like to bring a piece of paper to a meeting, but that doesn’t mean it is the right tool for writing long articles anymore. The time it will take to rewrite the piece and check for errors manually – is definitely not as efficient as autocorrect. The same with Excel, while some companies have a simple consolidation process and therefore do not need upgrading. Others notice the time they lose on validating numbers but are unsure about a new tool’s simplicity and security. Read more about two common misconceptions here.

Checklist: Are your consolidation ‘needs’ handled better outside of Excel?

Whether you should move away from Excel consolidation to a dedicated consolidation tool depends on your current situation. Thus, we have created a checklist to make it easy for all finance professionals to assess their Excel Consolidation challenges. To ensure you can deliver accurate and timely data with Excel, go through each of these points and see where your group is. More than three ticks usually equal consideration for a new consolidation tool.

Note: None of these elements make up the answer alone. More than three ticks mean you have a need. The more ticks you add, the more pressing it is you change now to ensure continued growth and minimize time spent on processes that easily can be automated. Furthermore, reduce the risk of constant error.

Do you trust your data? And are you willing to live with the financial implications your errors create for the annual report?

In a digital age like ours, technology develops rapidly; it goes not only for Finance but for all industries. New and advanced technologies continuously become available to empower us. And where we see the most significant impact is in the repetitive processes of our daily work. Here, technology truly increases our work’s quality, flexibility, and efficiency – while saving us time. However, looking at Finance’s digitalization, Excel seems to act as a stop block for going digital when making the annual report. But why exactly? Especially since research shows that almost 90% of all spreadsheets contain errors – 90%! Just take a moment to digest that.

We often think our own spreadsheets do not fall in this statistic. But with a 90% error rate, we fool ourselves if we remain in this belief.

In the words of the stoic Roman philosopher, Seneca: To err is human, but to persist [in error] is diabolical.

While you keep that in mind, let’s move on a bit and look at the most common and prominent errors when using Excel for the annual report.

Why making your annual account in Excel is a tedious, time-consuming task

  • Excel is highly prone to fundamental human error (remember the 90%). And you will make the same errors again and again
  • Excel quickly gets out of control as different versions circulate
  • Excel lacks transparency as it fails to show a complete audit trail and documentation

You probably have more errors to add to this list, but we are sure you will get the picture by now.

So, with these errors in mind, let us pose some questions to you. What is your reason for using Excel for the annual report? Does Excel live up to your needs and requirements? Do you trust your numbers? Do you have the documentation you need? Or do you have to go over your data multiple times and confer with your subsidiaries on an ongoing basis?

Stepping into the digital era where automation and standardized process tools are a part of your everyday life is a true game-changer. And that is what you will experience with software for financial consolidation and reporting. Regardless of size, every group must make an annual report at the end of each financial year. If you are using Excel for this, you already know the tedious and time-consuming process of looking through numerous sheets to get an overview of the financial data for the past 12 months. But it is not only in the annual report that Excel plays a big part as a time-stealer. Also, every month or every quarter, the financial consolidation and reporting in Excel is extremely time-consuming due to the number of errors the spreadsheets accrues.

What automation can do for you

Imagine for a second that instead of using Excel, you have a database that automatically saves and updates all your financial figures and calculations for your reporting. All the documentation is visible, and you have a full audit trail – meaning there is a complete overview of where the numbers originate. In this scenario, transparency makes the annual report much faster and the workflow smoother. The reason is that instead of looking through numerous sheets, you can draw the numbers you need from one database. Also, this transparency makes it unnecessary to check your subsidiaries’ financial figures. Furthermore, the system finds the errors for you. As a result, you don’t spend much time on error-finding but can go directly to correcting the errors instead.

Even though this scenario might sound too good to be true, the reality is that it is not.

Automating and standardizing work processes, like your financial consolidation

The result of standardizing and automating repetitive processes is a more smooth, efficient, and flexible workflow. For example, if the financial consolidation process is automated, you can reduce consolidation time by approximately 50% by eliminating:

  • Manual controlling and uploading of your subsidiaries’ reporting
  • Error-checking a spreadsheet, too many hands have edited
  • Manual calculations like:
    • Exchange rates adjustments
    • Intercompany eliminations
    • Non-controlling interests
  • Inaccuracy in financial data

The extra time you gain enables you to make room for other value-adding tasks, like in-depth financial analyses and counseling of your management. You can better influence your group’s decisions and not just deliver the financial figures. Simply put, your consolidation will ‘just’ be another report.

If you are still clinging to your Excel spreadsheet for your financial reporting and consolidation, you must have an excellent (and unknown) reason. But if you have yet to come up with that exact reason, then you are most likely well on your way to leaving Excel behind and saying hello to the digital age of Finance – just like your fellow CFOs, Finance Managers, and Controllers around the globe. 

Do you want to know how to enter the digital age by implementing financial consolidation and reporting software? Then book us for a short product tour here.

Martin Birch, Finance Business Partner at Konsolidator and former Chartered Accountant from Deloitte.

Can “Time is money” be more literal than in Finance? Everything we do affects business growth, strategy, and cash flow. Amazingly in today’s digital world, many Finance departments keep several manual processes in Excel; this includes their consolidation – numbers shown to the government, investors, and the public. So, why do we insist on maintaining an error-prone manual process or delaying the implementation process?

When we talk about financial reporting, consolidation plays a significant part in Group finance. But because it is not a daily task, it often drops in prioritization when the department needs to be digitalized. There can be many reasons for this; however, as your credibility relies on these numbers, shouldn’t we prioritize it? One common thing is that automating this process will bring you one step closer to saving time and delivering error-free numbers. When we look at global research studies, one of the most common reasons accounting firms move to the Cloud is to ‘reduce errors through standardization of processes and tasks.  

Clean up your consolidation process with Konsolidator 

At Konsolidator, we have built software that is easy to use and can easily integrate with existing ERP systems. With our founders being former CFOs and auditors, this software has been developed with the expertise and insight of Group accounting – including thorough knowledge of what is essential and what is unnecessary when you need to streamline a complicated consolidation process. Konsolidator aims to eliminate common challenges with consolidation to help CFOs and Group finance professionals deliver more substantial results and get more time to influence the company strategy with their unique insight. If you are doing financial consolidation right now, it might be a good idea to see if consolidation software is for you.

Are your consolidation ‘needs’ handled in Excel // download the checklist

Find out where you are using too much time on a standardized process:

  • Is it collecting data from subsidiaries?
  • Maintaining an error-free spreadsheet?
  • Calculating Exchange rates?
  • Collaborating across locations?

There can be many reasons for this process losing time. The ones we have mentioned are classic and can all easily be solved with automation. Whether you should move away from Excel consolidation to a dedicated consolidation tool depends on your current situation. Thus, we have created a checklist to make it easy for all finance professionals to assess their Excel Consolidation challenges. To ensure you can deliver accurate and timely data with Excel, go through each point and see where your Group is. More than three ticks usually equal consideration for a new consolidation tool. 

Is cloud software for your department?  

The answer, in most cases, would be yes. Even Cloud doubters have started migrating towards Cloud – according to Gartner’s research, 85% of companies are planning their move. We can understand this, especially when looking at the increasing focus on remote work and collaboration. Choosing cloud software for your consolidation means you get an automated tool with all the necessary features to do a complete consolidation, alongside the added reward of reducing errors through standardized processes and tasks. Other features of the Cloud are:

  • Easier collaboration and remote working
  • Saving time and costs
  • Getting real-time access from any portable device
  • Increased security
  • Mitigating risk
  • Adding flexibility and scalability to help grow the business
  • Centralized document storage

Integration plays a significant part when you choose Cloud software. 

Ensuring that our software is easy to integrate with the rest of your digital ecosystem – is vital. There are many opportunities to create a digital ecosystem that focuses on integrations, not on how much ONE system can bring with digital development today. Say you need an ERP system, a consolidation system, and a reporting system – the more you try to incorporate everything, the larger the system gets and the more difficult it is to implement, learn, and maintain. With Cloud, the supplier looks after the software, making it simple to use. It can integrate with everything you have – ensuring that data flows seamlessly from one application to another. And when it is not relevant, you can end your subscription. 

Meet Konsolidator

Konsolidator’s cloud-based financial consolidation software is the tool to remove the complexity from consolidation, enhance reporting, digitalize your department, save time and resources, and make better decisions for your Group. Bring digital transformation to your finance department with Konsolidator®.

Learn more about how cloud consolidation can help your team deliver more substantial results. And even more importantly, ERROR-FREE results. Click here for a quick chat about whether your company needs to clean up its consolidation.

If you are using a cloud ERP or accounting system for your consolidation, you can get two weeks free trial with your own or demo data.


Even though many of us know that we risk making mistakes by leaving big decisions until the very last minute – we still do it. Many of you will recognize this from your personal life, but it certainly holds for many accounting decisions. Whether it is due to time pressure, overconfidence, too many tasks, insufficient hands, or other things, we often see that last-minute journal entries go wrong – even when experienced finance professionals are involved. But why is that?

In this blog, we investigate the answer to this question – and the answer also holds the key to avoiding errors in future reporting. 


Reporting from consolidated entities is often subject to multiple local controls. Your control framework – which is usually worked intensely on with the help of skilled auditors and consultants – requires all journal entries to be documented, approved, tested, and audited. Also, local reporting often forms the basis for local KPIs, bonus schemes, and balanced scorecards. In itself, this requires due diligence in reporting (not saying, of course, that you cannot find errors and omissions in the history of accounting, even down to accounting performed in local sub- or sub-sub-entities). However, the final accounting adjustments, made on a group level, are often handled by a select group of employees.

And this group of employees is often crucial in finalizing the financial statements for the year. It probably has the company CFO in it, as an example, who may be the only person in the company knowing whether the company: 

  • wants to restructure a division, 
  • close down a factory, 
  • cease an operation, 
  • Or other

This group of people is the one to assess a potential impairment. As a result, the final adjustments may not be ready until the very last minute. Furthermore, they may be hand-carried through the books by the same people who prepare the adjustments. But if this is the case, there should be processes that ensure a fast and accurate approach to avoid the risk of errors. The 1-10-100 rule illustrates the importance of this.


Excel spreadsheets are great for many things but not for audit trails! Often, we mishandle these last-minute adjustments in the spreadsheets.

Below you might recognize some of the three classic examples of easy mistakes that most of us have (unintendedly) come across at some point in our careers as finance professionals:

1) Formulas are overwritten by a value. The CFO assessed the value of the obligation, and it is quicker to book it right there and then in the consolidation spreadsheet. You will worry about that entry in the accounting system some other day.

2) Cells, rows, or lines are added or deleted, which further down the sheet results in incorrect totals and subtotals.

3) A rule to transform a source value to a result is not documented. The entered currency rate between the local entity reporting currency and the consolidation currency is just a number in the spreadsheet cells.

With these (typical) errors in mind, let us consider why the 1-10-100 rule is relevant.

In 1992, George Laboviiz and Yu Sang Chang developed the concept of the 1-10-100 rule. The rule suggests that correcting errors is more costly than preventing them. In fact, moving from the prevention of an error to detection increases the cost of a mistake by a factor of 10. And, if you move on to correction – or failure – that factor is 100! Relevant for everyone in finance today who spends more time correcting errors than preventing them. Even more so due to the digital tools, we have available to ensure data quality. In truth, you know it, and we know it; it all comes downs to data quality when delivering reporting. 


Let’s illustrate the rule in detail. The rule has three phases, each explaining the cost of maintaining data quality.


Following this rule, it will cost you $1 to verify accurate data at the capture point. It is the least expensive and, by far, the most effective way of ensuring you capture clean and precise data. At this point, your data originates, and haven’t influenced other data yet, e.g., your subsidiary’s wrong balance sheet hasn’t affected the group’s result. Therefore, it makes sense that controlling your data before it enters the report will always be the preferable and less expensive choice.


Now your $1 has increased exponentially to $10. Why? The $10 represents the increased cost of incorrect data on your business the longer you leave it. More specifically, if one subsidiary has delivered a wrong number, this data will feed into the balance, which then will be part of the group’s results – suddenly, you risk providing an incorrect result. And it will take much longer to find and correct the mistake, ergo the high increase.


If you do nothing and do not catch the error, the cost increases to $100. Furthermore, you risk delivering data filled with unintended mistakes. If you do not correct poor data in time, it will affect your overall result. And honestly, it happens way too often in finance reports – whether you recognize it or your colleague can. But the time and money you use to correct and prevent it from happening again have suddenly increased drastically too.


While we can all agree that it is a financial (and time-consuming) problem to correct poor data, the biggest issue with poor data is that it leads to poor decisions. So, do your company (and yourself) a favour and find a method that supports accurate data processing. A method that won’t let you easily commit those manual errors we are often prone to make, especially when we are in a hurry and lack a formalized and structured data processing method.

Studies suggest that almost 9 out of 10 spreadsheets contain errors. And by errors, we mean unintended actions with negative consequences or failing to achieve the desired outcome. Of course, we are all convinced that the errors do not apply to our own Excel spreadsheets – but with 9 out of 10 spreadsheets containing errors, the risk is high!

Nobody is perfect, and there is always a risk when processes involve humans.

So, the takeaway is to learn to identify those processes where errors can occur and create new processes around them, which will help you avoid those errors next time you are in a hurry to complete, e.g., your consolidation. 

Right now, start by taking a good hard look at your Excel solution and evaluate if it is the tool you should use for complex reporting like your consolidation.

Furthermore, your auditors will also investigate your Excel sheets in a few weeks or months. They will verify that you can track all the consolidation amounts back to their source, and their focus will also be on those last-minute journal entries.  


We, of course, recommend using consolidation software to avoid unintendedly making mistakes in your last-minute journal entries. The advantages of an actual system vs. a spreadsheet solution are many. But the particular advantage for the purpose of documenting those important journal entries is the formalized structure a consolidation software gives you.

Here are just a few examples:

  • A system requires you to enter a journal entry in a standardized manner.
  • A system will provide you – and your auditors – with an audit trail.
  • A system makes sure you cannot post a one-legged entry.
  • A system (often) requires you to ask experienced colleagues to perform the entry because of segregated duties between employees.
  • A system calculates all entries and does not skip cells or columns.

Even for SMEs, we believe that the advantages of consolidation software outweigh the costs. If you have just a few consolidated entities in your group, chances are that the consolidation process is not embedded in your daily routines – every consolidation is a new experience, and you have to start all over again. Here, a consolidation software solution will give you a head start.

So, if you have ever made a wrong call due to a last-minute decision, don’t take this habit into your accounting manners. Get started on a formalized consolidation process and stop making errors in the last-minute journal entries.

Get a quick preview of how your consolidation can look with a formalized structure in Konsolidator