From an internal control perspective, this is a dangerous practice.
The problem is not just that the spreadsheets are flawed—one study found that 94% of spreadsheets have errors—but that they lack the proper risk-mitigating controls, which should be a major concern for those using spreadsheets in accounting and finance functions.
[IMGCAP(1)]Ever since the earliest spreadsheet software, people have been relinquishing many tasks and responsibilities to this ubiquitous tool, and for good reason: spreadsheets are easy to set up, perform all but the most complex functions, and are available everywhere.
Admittedly, an application such as Microsoft Excel, which took the business world by storm, is a lot more powerful today than its earlier versions.
The use of “ungoverned” spreadsheets in daily work is ingrained so deeply that many accounting and finance professionals don’t recognize it as a serious problem.