In light of the news that Richard Cuthbert, CEO of outsourcing specialist Mouchel, has stepped down after a spreadsheet-based accounting error reduced Mouchel's full-year profits by more than £8.5m to below £6m and prompted a profits warning, Ralph Baxter, CEO of data management and spreadsheet specialist ClusterSeven, said:
"The announcement from Mouchel regarding an unfortunate accountancy error is the latest in a line of similar spreadsheet-based data mistakes that have become public knowledge resulting in loss of money and reputation. The truth is that hundreds, if not thousands, of such errors happen on a regular basis as the pressures on firms and the people they employ to manage their unstructured financial data grows to a profound level. Only many hours of employee diligence prevents these errors from propagating into company reports and decisions. Indeed, much of the time people have to keep their fingers crossed and hope that they will be OK.
"Recent surveys from the likes of Deloitte, Protiviti and ClusterSeven have shown just how unprotected and mismanaged data processes can be across all business sectors. With financial regulators demanding total end-to-end information clarity under the likes of Solvency II, firms need to very seriously consider how they track and verify unstructured financial data – otherwise they will only find out how exposed they are when it is too late.”
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