Product Financial Control Solutions Spreadsheet Workbench

Transcription

1 Product Financial Control Solutions Spreadsheet Workbench Supporting Financial Transformation Through Increased Efficiency, Risk Mitigation and Control

2 Product In many respects spreadsheets represent the perfect business tool. They are extraordinarily flexible, remarkably powerful and yet common enough to be leveraged with little training or experience. However, the attributes that make spreadsheets so beneficial also come with an inherent level of risk. The use of spreadsheets touches nearly every area of any organization regardless of size of company, geography or industry sector. Spreadsheets are often used to manage critical data and that data is in turn often used to make significant decisions. Capital Adequacy The capital adequacy requirements found in Basel II and Solvency II impact spreadsheet use to recognize the prominent role that spreadsheets play in providing data into these calculations A review of spreadsheet models used by twentyone major banks and other financial service providers found that 92 percent of spreadsheet-based models dealing with tax issues had significant errors and 75 percent had significant accounting errors. And 91 percent of audited financial spreadsheets were found to have at least a 5 percent error in their bottomline value. Spreadsheets are highly susceptible to error because of the manual manner in which they are created and maintained. Spreadsheets can also be easily leveraged for the commission of fraud. This propensity for error, coupled with the heightened scrutiny needed across all business-critical areas, means that auditors and regulators are inevitably casting a closer eye on spreadsheet use and controls. The Challenge Spreadsheet usage is increasingly cited in regulations across multiple industries and geographies such as: US Sarbanes Oxley section 404 requires management and outside auditors to report on the adequacy of internal controls in the U.S. UK and Australia The Turnbull Report on Internal Control in the UK and Australia s ASX Principle 7 mandate similar internal controls and risk management requirements Insurance the NAIC (Model Audit Rule) directs that internal controls over financial reporting be applied to insurance companies Put simply, spreadsheets seldom have the proper levels of control applied to mitigate the risks they present to your organization. So what can be done to give spreadsheets the appropriate controls that regulators and auditors demand? The Solution Spreadsheet Workbench from Fiserv has attributes that fall into distinct, yet highly integrated categories. Combined, they offer a powerful solution that will mitigate potential risk and liability for your business. Discovery Identifying all spreadsheets across an organization is a major challenge. To identify the spreadsheets that represent a material risk to your organization requires automation based on an analysis of each spreadsheet in terms of its perceived materiality, complexity and potential organizational impact. Spreadsheet Workbench provides comprehensive functionality for the discovery of spreadsheets and other EUCs (End-User Computing) including Microsoft Access, Crystal Reports, SQL Server and other BI applications.

3 It uses an agent-less technology to discover and interrogate spreadsheet and other EUC files and related applications wherever they reside. This includes network drives, endusers desktops, laptops, document management systems, Microsoft Windows SharePoint Services and other databases. Spreadsheet Workbench recognizes that not all spreadsheets are created equally. You can analyze, manage and apply the proper level of control to their spreadsheets though the provision of filtering, selection and validation templates that include risk ratings, materiality, complexity and usage plus other user defined criteria. Once discovered, Spreadsheet Workbench captures key metrics, data and metadata about the EUCs, such as links, dependencies and complexity in spreadsheet applications or complete data dictionaries for Microsoft Access and database applications. This information represents a Living Inventory of the EUCs and gives users the ability to perform analytic functions, manage information workflows, and create documentation - all without impacting the performance and usability of existing end user applications. Security and Access Control Spreadsheets themselves provide little in the way of enterprise security. Most come with the ability to password protect entire spreadsheets, workbooks and even data at the cell level. However, this type of security relies entirely on individual users to implement it. Spreadsheet Workbench provides enterprise-level security and access control over your business critical spreadsheets. Whether the user is a manager requiring review and authorization permissions, a data entry user or an advanced spreadsheet developer, the right level of security and access control can be quickly established and maintained through a single sign-on. Version Control and Audit Understanding what changes have been made, who made them and when they occurred is essential when you consider that spreadsheets are often used as inputs to mission-critical applications and management reporting processes. Reviewers, management and auditors need to instantly see what changes have been made so they can determine if such changes are appropriate. Spreadsheet Workbench ensures a full audit history is maintained across all business-critical spreadsheets, including comprehensive information on users, time and date of creation. Powerful roll back capabilities allow previous versions to be re-instated and full spreadsheet narrative and documentation facilities are provided. With comprehensive audit facilities, all spreadsheet changes are recorded and exceptions reported and inquired upon. Only 11 percent of 245 chief financial officers (CFOs) surveyed by CFO magazine believed spreadsheet-based control reporting was accurate enough to make senior executives confident about certifying their companies financial statement data for Sarbanes-Oxley Act compliance.

4 Mitigate Risk and Liability The CFO of a major technology company hid commission entries by hiding a key cell in a spreadsheet used to manage commissions. The result? A loss of nearly $500 million in market capitalization when the scam was uncovered. The ability to quickly identify important or material changes is key to efficient spreadsheet management. Spreadsheet Workbench s spreadsheet comparison capabilities are recognized as the most advanced in the market, driving significant time and cost savings. Analytics Spreadsheet Workbench provides the most powerful set of spreadsheet analytics available. It proactively looks for anomalies at the cell level to alert users and reviewers alike of potential errors or fraud. A userdefined set of selection criteria allows you to investigate a wide range of errors, conditions and changes that have occurred across the whole population of business critical spreadsheets. Drill down capabilities allow users to investigate issues from summary-level right through to individual cell level problems. Spreadsheet Development Through its compliance with COBIT standards, Spreadsheet Workbench allows you to establish robust controls around the development of new business critical spreadsheet applications. Whether this is addressing the best practice of segregation of duties, or ensuring that spreadsheets are properly tested before being put into production, Spreadsheet Workbench greatly assists with both with the remediation of existing spreadsheets plus the development of new applications. Key Attributes of Spreadsheet Workbench: Identification of material spreadsheets within an organization Enterprise wide multi-user repository with full version management of spreadsheets Full access control and security Comprehensive audit trail and exception reporting Powerful analytics for spreadsheet comparisons Business logic checking Segregation of duties Spreadsheet development framework that enables users to develop robust and scalable spreadsheet applications Operational Efficiency In addition to the discovery, control, and analytic capabilities of Spreadsheet Workbench, the solution delivers operational efficiencies via its ability to automate manually intensive spreadsheetbased processes. Example: Sarbanes-Oxley requires that complex spreadsheets be tested from the ground-up each month to ensure that they are working properly. This can be a daunting task requiring highly skilled and highly compensated resources. Considered at the enterprise level, where there may be hundreds if not thousands

5 Key Benefits of Spreadsheet Workbench Increase in operational efficiency through significant time and cost savings Ability to meet audit requirements through stringent access control and monitoring capabilities Immediate control of legacy spreadsheet applications Faster month-end close Reduced operational risk Capacity to scale as your business expands of spreadsheets that require review, costs grow to significant levels. The ability to leverage Spreadsheet Workbench to automate the process of identifying and reporting only what has changed from month to month allows you to focus the vast majority of effort on more value added tasks. Spreadsheet Workbench and Reconciliation A certain degree of spreadsheet-based reconciliation is a reality, even for firms that have already implemented enterprise platform reconciliation solutions, such as Frontier and Accurate from Fiserv. The reconciliation process for nonstandardized transaction types, like those for OTC derivatives and particular one-off processes, are often housed within spreadsheets. Spreadsheet Workbench delivers significant value to the reconciliation process by placing the necessary controls around these processes to ensure that they, too, are managed in a robust, auditable and controlled manner across the enterprise. Spreadsheet Workbench and SharePoint If your organizations deploys Microsoft Windows SharePoint Services, Spreadsheet Workbench provides the most fully integrated solution for managing spreadsheet risk. Spreadsheet Workbench leverages the content management, business process facilitation and collaboration infrastructure that SharePoint 2007 provides. However, Spreadsheet Workbench goes beyond the capabilities of SharePoint 2007 and delivers a compliance solution that incorporates powerful spreadsheet control, audit and analytic capabilities. Shared Services/Centralization More stringent controls around spreadsheet use can also facilitate a shift in organizational structure by allowing the implementation of a shared service, outsourced or off-shored business model. Without tight controls on spreadsheets, which are often used to feed critical business intelligence and report platforms, these often more efficient business models are not realistically feasible.

6 Financial Control Solutions have offices offering 24x7 support in the following international locations: Atlanta U.S. Baltimore U.S. London UK and Ireland Luxembourg Continental Europe, Eastern Europe and Russia Dubai Middle East and South Africa Sydney Asia Pacific Singapore Asia Pacific A Consultative Approach When confronting spreadsheet related risk, it is about the immediate priority. Have you already spent the time and effort to catalogue the spreadsheets across the enterprise and has the inherent level of risk in each been determined? What about access control storing material spreadsheets on protected drives is simply not good enough anymore. Are valuable and talented employees spending too much time trying to understand changes to spreadsheets to ensure that management reporting is correct - instead of adding value via analysis of that reporting. The right way forward will often be different for each organization, with the best practice approach being to engage with Fiserv consultants to properly understand the most effective and efficient direction to take. Regardless of the approach, an enterpriseready solution one that can grow as your business grows and is ready to support multiple business lines across the organization is required to ensure that you can meet the growing risk, compliance and efficiency demands of today s marketplace. Case Study Leading Global Bank This international bank has seen dramatic reductions in the number of spreadsheet errors, and SOX-relevant processes are significantly more efficient after the implementation of improved spreadsheet controls. Logic inspection of spreadsheets used to take weeks. Now spreadsheets can be exposed, analyzed and bookmarked for remediation within minutes. External audit processes have been shortened testing is now only required for a minimum of control steps. Internal controls have been tightened, and the bank can now manage by exception with a greater level of detail. Spreadsheet control has made compliance inspections more complete and less subjective. A full audit of spreadsheet changes is maintained and alerts and exceptions generated. Standard operating procedures have been introduced that make any changes part of a controlled and auditable process. Connect with Us For more information on, please contact us at or visit

7 About Fiserv Fiserv is the global leader in financial services technology, driving innovation in Payments, Processing Services, Risk & Compliance, Customer & Channel Management, and Business Intelligence & Optimization. Our solutions can help you improve efficiency, manage risk and grow your business.

8 Fiserv, Inc. 255 Fiserv Drive Brookfield, WI Fiserv, Inc. or its affiliates. Fiserv is a registered trademark. Spreadsheet Workbench is a registered trademark of Finsbury Solutions Limited. Microsoft, Windows, and SharePoint are either registered trademarks or trademarks of Microsoft Corporation in the United States and/or other countries. Other products referenced in this material may be trademarks or registered trademarks of their respective companies. Copyright 2009 Fiserv, Inc. or its affiliates COL 08/09