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Excel Best PracticesChris Mishler,
CMA, CIA
EMU
April 8, 2010
4/1/2010 2
Overview
Why a CMA? A short intro
Benefits of better practices
Common Excel observations
Excel better practices.
Tips & Tricks
4/1/2010 3
Benefits of Best Practices
Improve the quality of your spreadsheets
Increase the reliability of output
Reduce errors
Increase auditability
Improve learning curve for others
Well-designed spreadsheets are user-friendly, increasing productivity
Look professional
CMA & Me
Took it during last year of school, passed 1st attempt
A raise!
A network through which I got my current job
Leadership in IMA
– Student Chapter President
– Professional Chapter President
– Michigan Council President
– National Board of Directors
Now what
– Consultant designing solutions
– Auditing high risk financial spreadsheets
4/1/2010 4
4/1/2010 5
Common Observations
Negatively and positively defined formulas– Use of “=-” or “=+”
– Eliminate them to reduce file size and increase legibility
Use of constants in formulas: =A1 * 0.35– Risk of a rate change not being caught
– Put rates or multipliers in named range, then can change all instances one time. Easier to understand: “Ending_Inv * Average_Cost” vs. “A2 * B2”
Hidden cells (columns, rows, sheets)– Reduce Excel errors (#REF!) by reducing use of hidden cells
Redundant data. Link to it, avoid duplication in headings, look-up tables, pivot tables being copied within a spreadsheet.
Non-descriptive tab names like “Sheet1” or “AFUDC (2)”. If you copy a page, give it a new, better name.
Spelling errors – why not hit F7 to check spelling? You’ll look even smarter. (Here’s a tough one “cumulative” or “cummulative.”)
4/1/2010 6
Common Observations
Blank input cells– Blank rows/columns included in total formulas.
– Risk increases of entry and totaling errors
– Use row height/column width for formatting instead
– Add underlines (borders) for separation instead of blank rows
– Protect blank input rows or columns
Improper ranges– Blank cells can cause improper ranges when creating
SUM formulas
– Check your work with Arrays (separate slide later)
4/1/2010 7
EXCEL ERRORS
#/DIV0!– This error is common in time-dependent spreadsheets that include
future periods without data. SOLUTION: =IF(B5=0,0,B4/B5). Other Excel errors may also be excluded by using IF(ISERR([your calculation],0,[your calculation]).
– ISERR covers a multitude of errors. Use it when you know errors will otherwise be shown. It is common to have blank data ranges when the number of rows of data varies, so division or LOOKUPs may cause unnecessary errors.
#NA! – Common in VLOOKUP functions. Use IF(ISNA([your function]…) or
IF(ISERR(…) to avoid erroneous outcomes.
#REF!– Often results from hiding cells, then making changes to formulas,
deleting cells.
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Best Practices
Spreadsheet Design
Color scheme
Protect your work
Presentation/Formatting
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Design it right from the start
Database mentality
“Segregation of duties” – Tabs and Colors
Think with the audience in mind (for output)
Document it!
– Use “Input Source Control” page
– Explain how your application works in a tab
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Computers like databases
As much as possible, organize data into
contiguous blocks of records. Think:
Columns are Fields, Rows are Records.
Avoid gaps. Databases abhor vacuums.
Once you have a database, custom output is
easier.
Easier to follow visually and logically.
Sample of “Database Look”
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Modular Spreadsheet Design
INPUTS(Periodic)
PROCESS
CALCULATIONS
(Protected)REPORTS
REPORTS
REPORTS
INPUTS(Assumptions
& Judgmental)
OUTPUT
CALCULATIONS
(Protected)
CHECK &
BALANCESpreadsheet
Documentation
Inputs are contained in a
separate worksheet tab,
color coded by input type
and are referenced by the
process calculations
Formulas are contained in a
separate worksheet tab, color-
coded by formula type, and
protected from accidental or
unauthorized changes
Reports are contained in
separate worksheet tabs and
linked to output calculations
as well as input data and
process calculations
All check totals and balance
figures are contained in a
single worksheet to provide
a single point of reference
for review and approval
Workbook
documentation is
contained in a
worksheet within the
workbook file
4/1/2010 13
Separate tabs for separate tasks
Logical grouping makes life easier
– Input: Users know where data should be entered, and
may stay out of other areas.
– Calculations: Easy to copy formulas, follow logic.
Protect the whole tab.
– Output: Make as many reports as needed, with the exact
look you want, not affecting input or calculations. No
need to hide cells.
– Control: Put crossfooting, check balances, tests together
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Auditing your work
Use an audit worksheet within the
spreadsheet to do audit checks– Cross-footing
– Input balancing or reconciliation
– Other verifications of accuracy
– Arrays
4/1/2010 15
More ways to reduce errors
Use ROUND in formulas to prevent cell
auditing errors from excessive decimals
Use range names in formulas to make them
understandable and more auditable
– Use Name Box (left side of formula bar) for
speedy range naming
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Range Names
4/1/2010 17
Using Colors for Clarity
Standardize Color Scheme for quick understanding
of structure when inputs, formulas, and outputs are
combined in one page
– Green for input that changes regularly/periodically
(unprotected cells)
– Yellow for input from external sources such as prices,
interest rate, or judgmental assumptions (unprotected)
– Red for calculations (protected cells)
– Blue for output (protected cells)
4/1/2010 18
Cell and Sheet Protection
You work hard for a living. Don’t allow
unauthorized access to your masterpieces!
– Format cells you want to protect as “locked”
• Format>Cells>Protection>Locked
– Then protect the sheet
• Tools>Protection>Protect Sheet
• Unless absolutely necessary, avoid passwords in
spreadsheet protection. (Hard to manage, not all that
secure.)
4/1/2010 19
Conditional Formatting and
Validation
At the cell level
Monitor input and output parameters of critical
cells
Example, Conditional Formatting:
Cell Validation Example
4/1/2010 21
Presentation – more than a pretty
face
Standardize Formatting
– Decimal places? Two typically, but often may not
need those pennies for higher level view.
– Dollar sign at the top and bottom
– Limit font styles, colors, font sizes for legibility
Good order promotes understanding.
– LABEL sections of the file, including totals
– Single line above, double line below $ Totals
4/1/2010 22
Tips and Tricks
Easy copy
Microsoft copy and paste shortcut keys
Customize your icons or toolbars
Conditional Sum Wizard is a whiz
See http://excel.tips.net/ for many time-saving
tips.
See http://mishlercentral.com/LINKStoLIKE.aspx for
some super Excel links
4/1/2010 23
Easy Copy
Quick copy Ctrl-D, Ctrl-R
– • Down:
Select the cells in the row(s) under the list and
press Ctrl+D.
• To the right:
Select a range of cells to the right and press
Ctrl+R.
4/1/2010 24
Quick copy or fill series - Autofill
Autofill – “So that’s what that is!” Try it, you’ll like it.
That little black box in the corner of the cell – double-click it at the top of a range and see what happens.
4/1/2010 25
Microsoft copy & paste
CTRL-INS copies the highlighted item to the
clipboard
SHFT-INS pastes the clipboard item
Available across many applications
To fill a range with the upper left cell, select
range, enter upper left cell content, then
CTRL-ENTER
Customize your toolbar – quick
and easy
Drag & Drop
4/1/2010 27
Conditional Sum Wizard
>Tools>Conditional Sum Wizard
Especially useful for multiple criteria
Uses arrays but you don’t have to type the formula.
Saves major trial & error time
Journal Entries often add the debits (>0) as a
control, which conditional sum will do easily.
Example on next slide: Sum all positive Gross Profit
values.
4/1/2010 28
Conditional Sum Example
EX: Add all positive gross
profit numbers
4/1/2010 29
Thank you and let’s compute with
confidence!
REVIEW BEST PRACTICES BENEFITS
QUESTIONS?
Chris Mishler
www.mishlercentral.com
