How Do You Calculate the Cost of a Spreadsheet?

This article takes an insightful look into the cost of a single spreadsheet that is used for financial consolidation.  Many companies ignore the high cost of maintaining spreadsheets because they have already purchased Excel or another package, and there are not huge license fees.   Spreadsheets are great tools for short, small projects, but care should be taken when using them as an extensive resource, as is often done for financial consolidation.  Spreadsheets are good choices when one needs to organize simple data in a fast and cost-effective manner.  It is easy to use Excel to save customer and prospect data when it is a small set to be used by a single person or a small group, but trouble arises when data grows and more people need access to it.  The following is a list of ways that time can be easily wasted when spreadsheets are used to track and consolidate financials:

  1. Managing and maintaining group-related data.

  2. Retyping data from spreadsheet to spreadsheet.

  3. Maintaining references between multiple spreadsheets.

  4. Consolidating multiple spreadsheets.

  5. Cross-checking to make sure numbers agree across multiple spreadsheets.

  6. Maintaining gargantuan spreadsheets.

  7. Hard-coding data from reports to spreadsheets.

  8. Rearranging spreadsheets to show new perspectives on the data.

  9. Restructuring spreadsheet models to reflect changes in the company organization.

  10. Converting between different proprietary spreadsheet applications.

This simple formula below can be utilized to estimate how much each spreadsheet costs an organization.

  1. The average amount of time it takes to create, maintain, and correct a single spreadsheet. This will vary for different spreadsheets that are used for different purposes (there are some spreadsheets are worked with every day, while there are others are only utilized once in a while.) Come up with an average for the purposes of this estimation. Also, the bigger the spreadsheet, the more expensive it is.  Employees involved in budgeting and forecasting will say that it’s possible to look at the same few spreadsheets for an entire year (or over multiple years – next year’s budget starts out exactly the same as this year’s, just with tweaking a few values).  The point is that people that are heavily involved in creating, maintaining, and correcting spreadsheets generally see fewer spreadsheets per year than others, but the sheets are much bigger and require a substantial amount of time to maintain.  There are others who work with many different spreadsheets every day, but these sheets are generally much smaller and require much less time.
  2. Assume that the average medium-sized business deals with 1,500 accounting spreadsheets per year and employs 30 people (full-time equivalents in this case, or FTEs) to create and maintain them.  If we take 2,000 hours as the number of hours worked per year by the average FTE, then we know that (2,000 x 30) = 60,000 hours are spent dealing with spreadsheets.  Dividing this by 1,500 spreadsheets, we can calculate the amount of time it takes to create, maintain, and correct a single spreadsheet to be (60,000 / 1,500) = 40 hours.
  3. The average annual wage of FTEs who create and maintain the spreadsheets.  We will use a burdened rate of $75 per hour.
  4. That’s it.  Now we multiple 40 hours per spreadsheet by $75 per hour to get $3,000 per spreadsheet (annually).

If you haven’t already done the math, that’s $4.5 million per year spent on maintaining spreadsheets for a medium business.  Enterprise Resources Planning (ERP) systems may carry a hefty price tag, but they clearly reduce costs over the long run by making related data available to a large number of people and streamlining accessibility, something spreadsheets just can’t do.

In addition to the high costs, spreadsheets do not have the data control and governance often embedded in ERP systems.  Anyone can change a spreadsheet, and it is often the case that different spreadsheets use different base figures resulting in different end results for different parts of the organization.  For SOX and IFRS compliance, it is quite risky to base processes on results derived by a spreadsheet.  The drill-down and roll-up from transaction systems is often not available, and many undocumented assumptions are made about how line items in a spreadsheet are calculated.  Even accounting basics like making sure that the debits equal the credits for a balancing value are not enforced in a spreadsheet.

The best use of spreadsheets is to satisfy temporary or short-term requirements (such as creating a mapping file to change the chart of accounts).  It is not wise or cost-effective for an organization to employ spreadsheets as an integral part of its financial operations.  They simply aren’t built for it.

eprentise often talks to organizations about changing their chart of accounts or changing the way their operating units or legal entities are set up.  Many currently use spreadsheets to perform financial consolidations.  Here is one example of a company’s monthly consolidation:

In this case, each legal entity was represented across 4 ledgers.  In order to consolidate the monthly financials for this company, they created spreadsheets to total the financials for each of the arrows in the diagram.  The monthly close process was 20 days.  By moving the legal entities into a single ledgers, the company reduced their close cycle to 3 days, got more accurate data, eliminated thousands of spreadsheets, and reduced costs.

Download PDF

517 thoughts on “How Do You Calculate the Cost of a Spreadsheet?”

  40. Peterdex says:

    pharmacie en ligne [url=https://pharmafst.shop/#]Meilleure pharmacie en ligne[/url] pharmacie en ligne fiable pharmafst.shop

  46. Peterdex says:

    Acheter Kamagra site fiable [url=http://kamagraprix.com/#]kamagra livraison 24h[/url] kamagra pas cher

  52. Peterdex says:

    Cialis sans ordonnance 24h [url=https://tadalmed.shop/#]Tadalafil sans ordonnance en ligne[/url] Tadalafil achat en ligne tadalmed.com

  57. Peterdex says:

    acheter kamagra site fiable [url=https://kamagraprix.com/#]acheter kamagra site fiable[/url] Kamagra Oral Jelly pas cher

  63. Peterdex says:

    pharmacie en ligne livraison europe [url=http://pharmafst.com/#]Meilleure pharmacie en ligne[/url] pharmacie en ligne france fiable pharmafst.shop

  68. Peterdex says:

    Pharmacie en ligne Cialis sans ordonnance [url=https://tadalmed.com/#]Tadalafil sans ordonnance en ligne[/url] Cialis generique prix tadalmed.com

  73. Peterdex says:

    kamagra 100mg prix [url=https://kamagraprix.shop/#]Kamagra Oral Jelly pas cher[/url] kamagra pas cher

  80. Peterdex says:

    Pharmacie sans ordonnance [url=http://pharmafst.com/#]pharmacie en ligne sans ordonnance[/url] pharmacie en ligne livraison europe pharmafst.shop

  95. Peterdex says:

    pharmacie en ligne france livraison belgique [url=https://pharmafst.shop/#]Pharmacie en ligne France[/url] Pharmacie sans ordonnance pharmafst.shop

  101. Peterdex says:

    Achetez vos kamagra medicaments [url=https://kamagraprix.shop/#]Kamagra Commander maintenant[/url] achat kamagra

  107. MichaelFuB says:

    canadian world pharmacy [url=https://expressrxcanada.shop/#]canadian drugs pharmacy[/url] drugs from canada

  113. MichaelFuB says:

    canadian pharmacy world [url=https://expressrxcanada.com/#]Buy medicine from Canada[/url] pet meds without vet prescription canada

  119. MichaelFuB says:

    safe canadian pharmacy [url=https://expressrxcanada.com/#]ExpressRxCanada[/url] canadian pharmacy online store

  124. MichaelFuB says:

    mexico pharmacy order online [url=https://rxexpressmexico.com/#]mexican online pharmacy[/url] mexico pharmacy order online

  131. MichaelFuB says:

    ordering drugs from canada [url=https://expressrxcanada.com/#]Generic drugs from Canada[/url] best rated canadian pharmacy

  136. MichaelFuB says:

    canada pharmacy online legit [url=https://expressrxcanada.shop/#]Canadian pharmacy shipping to USA[/url] canadian pharmacy no scripts

  140. MichaelFuB says:

    indian pharmacy online [url=https://medicinefromindia.shop/#]indian pharmacy online shopping[/url] reputable indian online pharmacy

  150. Richardanock says:

    пин ап казино официальный сайт [url=http://pinuprus.pro/#]pin up вход[/url] пин ап казино

  154. Richardanock says:

    вавада казино [url=http://vavadavhod.tech/#]vavada casino[/url] вавада официальный сайт

  159. Richardanock says:

    вавада зеркало [url=http://vavadavhod.tech/#]vavada вход[/url] vavada casino

  165. Richardanock says:

    пин ап вход [url=http://pinuprus.pro/#]пин ап вход[/url] пин ап вход

  170. Richardanock says:

    vavada [url=https://vavadavhod.tech/#]вавада официальный сайт[/url] vavada casino

  175. Richardanock says:

    pin up casino [url=http://pinupaz.top/#]pin up azerbaycan[/url] pin-up casino giris

  186. Richardanock says:

    вавада зеркало [url=https://vavadavhod.tech/#]вавада официальный сайт[/url] vavada вход

  191. Richardanock says:

    vavada casino [url=https://vavadavhod.tech/#]вавада казино[/url] vavada

  207. Richardanock says:

    пинап казино [url=http://pinuprus.pro/#]пинап казино[/url] пин ап казино официальный сайт

  211. Richardanock says:

    pin-up casino giris [url=http://pinupaz.top/#]pin-up casino giris[/url] pin up az

  215. Richardanock says:

    вавада официальный сайт [url=https://vavadavhod.tech/#]вавада[/url] vavada casino

  223. Richardanock says:

    пин ап казино [url=https://pinuprus.pro/#]pin up вход[/url] pin up вход

  233. Richardanock says:

    вавада казино [url=http://vavadavhod.tech/#]вавада[/url] вавада зеркало

  237. Richardanock says:

    pin up вход [url=http://pinuprus.pro/#]пин ап вход[/url] pin up вход

  241. Richardanock says:

    пин ап вход [url=http://pinuprus.pro/#]пин ап вход[/url] пин ап зеркало

  245. Richardanock says:

    pin up вход [url=http://pinuprus.pro/#]пин ап казино официальный сайт[/url] пин ап казино

  249. Richardanock says:

    вавада официальный сайт [url=https://vavadavhod.tech/#]vavada casino[/url] вавада официальный сайт

  253. Richardanock says:

    вавада казино [url=http://vavadavhod.tech/#]vavada[/url] вавада казино

  257. Richardanock says:

    vavada casino [url=https://vavadavhod.tech/#]vavada casino[/url] vavada вход

  262. Richardanock says:

    пинап казино [url=https://pinuprus.pro/#]pin up вход[/url] pin up вход

  270. Richardanock says:

    вавада официальный сайт [url=http://vavadavhod.tech/#]вавада казино[/url] вавада казино

  275. Richardanock says:

    vavada вход [url=https://vavadavhod.tech/#]вавада зеркало[/url] vavada вход

  279. Richardanock says:

    пинап казино [url=https://pinuprus.pro/#]пин ап зеркало[/url] пин ап казино

  283. Richardanock says:

    вавада [url=https://vavadavhod.tech/#]вавада зеркало[/url] vavada вход

  291. Richardanock says:

    pin up azerbaycan [url=http://pinupaz.top/#]pin up azerbaycan[/url] pinup az

  295. Richardanock says:

    пин ап казино официальный сайт [url=http://pinuprus.pro/#]пин ап вход[/url] пин ап зеркало

  299. Richardanock says:

    pin up az [url=https://pinupaz.top/#]pin-up casino giris[/url] pin-up casino giris

  304. Richardanock says:

    вавада официальный сайт [url=https://vavadavhod.tech/#]vavada[/url] вавада

  308. Lorenzoalera says:

    Viagra without prescription [url=https://maxviagramd.com/#]best price for Viagra[/url] order Viagra discreetly

  313. Lorenzoalera says:

    secure checkout Viagra [url=https://maxviagramd.com/#]no doctor visit required[/url] buy generic Viagra online

  319. Lorenzoalera says:

    doctor-reviewed advice [url=https://modafinilmd.store/#]buy modafinil online[/url] verified Modafinil vendors

  325. Lorenzoalera says:

    generic tadalafil [url=https://zipgenericmd.com/#]affordable ED medication[/url] best price Cialis tablets

  329. Lorenzoalera says:

    buy generic Cialis online [url=http://zipgenericmd.com/#]Cialis without prescription[/url] buy generic Cialis online

  335. Lorenzoalera says:

    Modafinil for sale [url=https://modafinilmd.store/#]modafinil legality[/url] modafinil legality

  339. Lorenzoalera says:

    generic sildenafil 100mg [url=https://maxviagramd.com/#]order Viagra discreetly[/url] fast Viagra delivery

  345. Lorenzoalera says:

    same-day Viagra shipping [url=https://maxviagramd.com/#]same-day Viagra shipping[/url] cheap Viagra online

  350. Lorenzoalera says:

    generic tadalafil [url=https://zipgenericmd.shop/#]online Cialis pharmacy[/url] FDA approved generic Cialis

  356. Lorenzoalera says:

    generic tadalafil [url=http://zipgenericmd.com/#]secure checkout ED drugs[/url] order Cialis online no prescription

  361. Lorenzoalera says:

    Modafinil for sale [url=http://modafinilmd.store/#]safe modafinil purchase[/url] modafinil legality

  366. Lorenzoalera says:

    secure checkout Viagra [url=https://maxviagramd.com/#]order Viagra discreetly[/url] buy generic Viagra online

  371. Matthewvek says:

    amoxicillin 500mg pill [url=https://amohealthcare.store/#]Amo Health Care[/url] order amoxicillin online no prescription

  376. Matthewvek says:

    Amo Health Care [url=https://amohealthcare.store/#]medicine amoxicillin 500[/url] can i buy amoxicillin online

  382. Matthewvek says:

    Amo Health Care [url=https://amohealthcare.store/#]buying amoxicillin online[/url] Amo Health Care

  388. Matthewvek says:

    Amo Health Care [url=https://amohealthcare.store/#]amoxicillin order online[/url] order amoxicillin 500mg

  393. Matthewvek says:

    PredniHealth [url=http://prednihealth.com/#]PredniHealth[/url] purchase prednisone no prescription

  397. Matthewvek says:

    PredniHealth [url=https://prednihealth.com/#]prednisone without prescription.net[/url] PredniHealth

  402. Matthewvek says:

    clomid without a prescription [url=https://clomhealth.shop/#]Clom Health[/url] how can i get clomid without a prescription

  405. JosephGaire says:

    cialis no perscrtion [url=https://tadalaccess.com/#]TadalAccess[/url] tadalafil 20mg canada

  409. JosephGaire says:

    cialis in las vegas [url=https://tadalaccess.com/#]Tadal Access[/url] cialis free trial

  413. JosephGaire says:

    why does tadalafil say do not cut pile [url=https://tadalaccess.com/#]TadalAccess[/url] tadalafil best price 20 mg

  418. JosephGaire says:

    cialis in canada [url=https://tadalaccess.com/#]TadalAccess[/url] great white peptides tadalafil

  422. JosephGaire says:

    cheap cialis pills [url=https://tadalaccess.com/#]cialis pills for sale[/url] cialis 5mg how long does it take to work

  426. JosephGaire says:

    tadalafil tablets 20 mg side effects [url=https://tadalaccess.com/#]evolution peptides tadalafil[/url] cialis generic release date

  430. JosephGaire says:

    cialis online no prescription australia [url=https://tadalaccess.com/#]TadalAccess[/url] cialis strength

  435. JosephGaire says:

    buy generic tadalafil online cheap [url=https://tadalaccess.com/#]cialis professional 20 lowest price[/url] cialis windsor canada

  439. JosephGaire says:

    purchasing cialis [url=https://tadalaccess.com/#]TadalAccess[/url] what is cialis pill

  442. JosephGaire says:

    cialis overnight deleivery [url=https://tadalaccess.com/#]cialis with out a prescription[/url] best price on generic cialis

  446. JosephGaire says:

    tadalafil and sildenafil taken together [url=https://tadalaccess.com/#]natural cialis[/url] cialis canada

  451. JosephGaire says:

    cialis vs flomax [url=https://tadalaccess.com/#]cialis slogan[/url] cialis advertisement

  455. JosephGaire says:

    best price on cialis 20mg [url=https://tadalaccess.com/#]TadalAccess[/url] mambo 36 tadalafil 20 mg

  459. JosephGaire says:

    what is cialis pill [url=https://tadalaccess.com/#]TadalAccess[/url] natural cialis

  463. JosephGaire says:

    cialis savings card [url=https://tadalaccess.com/#]when will teva’s generic tadalafil be available in pharmacies[/url] cialis coupon online

  468. JosephGaire says:

    maximpeptide tadalafil review [url=https://tadalaccess.com/#]sunrise pharmaceutical tadalafil[/url] cialis tadalafil tablets

  472. JosephGaire says:

    cialis manufacturer coupon 2018 [url=https://tadalaccess.com/#]Tadal Access[/url] best time to take cialis 5mg

  476. JosephGaire says:

    where to buy cialis in canada [url=https://tadalaccess.com/#]cialis 100 mg usa[/url] tadalafil hong kong

  481. JosephGaire says:

    tadalafil (exilar-sava healthcare) [generic version of cialis] (rx) lowest price [url=https://tadalaccess.com/#]how long before sex should i take cialis[/url] tadalafil best price 20 mg

  484. JosephGaire says:

    tadalafil and voice problems [url=https://tadalaccess.com/#]canada drugs cialis[/url] purchasing cialis online

  488. JosephGaire says:

    buying cialis without prescription [url=https://tadalaccess.com/#]tadalafil 40 mg with dapoxetine 60 mg[/url] cialis professional vs cialis super active

  492. JosephGaire says:

    cialis price walmart [url=https://tadalaccess.com/#]what are the side effects of cialis[/url] buying cialis generic

  496. JosephGaire says:

    what happens if a woman takes cialis [url=https://tadalaccess.com/#]Tadal Access[/url] cialis online paypal

  500. JosephGaire says:

    where to buy liquid cialis [url=https://tadalaccess.com/#]tadalafil tablets 20 mg reviews[/url] cialis sublingual

  504. JosephGaire says:

    cialis no perscrtion [url=https://tadalaccess.com/#]Tadal Access[/url] prescription for cialis

  507. JosephGaire says:

    cialis side effects [url=https://tadalaccess.com/#]TadalAccess[/url] best price on generic tadalafil

  512. JosephGaire says:

    cialis manufacturer coupon free trial [url=https://tadalaccess.com/#]buy cialis toronto[/url] buy cialis in las vegas

  517. JosephGaire says:

    how long does cialis take to work [url=https://tadalaccess.com/#]Tadal Access[/url] order cialis from canada

Leave a Reply

Your email address will not be published. Required fields are marked *