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daemon13 | 12 years ago
Sorry, I could not comprehend the second paragraph.
Fraud has nothing to do with paper or computer based system. To minimize risk of fraud you need to implement proper sets of controls, like segregation of duties, etc.
As for Excel - Excel is a poor instrument for doing the accounting, therefore it shall not be used ... unless you have some kind of micro/nano business.
einhverfr|12 years ago
Well, let's see.
1. Preprocessing data for entry. This might be used, for example, if you want to depreciate fixed assets using a method your accounting software does not support.
2. Post-processing data. You might do this if you have a report from an accounting system but your final report needs to take into account additional factors. Some of my customers use Excel to turn trial balance data from their accounting systems into financial statements.
Another example of post-processing might be if you take aggregated sales reports from an accounting system and further process it by business folk who don't know the programming environment.
As for paper: Yes, separation of duties is a part of it but paper has an advantage that no computer system can match, namely that if you keep your books in indelible ink, then alteration of numbers is obvious on audit. This is a weak point of electronic media. You can lock it down, but it is always possible for someone to unlock it. So with comparable policies, paper wins out anti-fraud-wise.
daemon13|12 years ago
>> 1. Pre-processing data for the entry.
For this specific example if the accounting package does not support certain depreciation method (which rather rare), you can easily do this in Excel, both for financial modelling purposes and as a supporting document for the accounting entry.
>> 2. Post-processing data.
What you describe is not accounting. This is financial and management reporting. Yes, Excel is what is used by most everyone.
Good points.