Just over half of the C-level executives working in UK financial services firms expect regulators to demand greater understanding of how they manage business critical data held on spreadsheets and similar databases over the next 12 months, reports ClusterSeven
A study by the specialist data management firm also finds that 40% of C-level executives believe that auditors will review spreadsheet management processes and systems as a key part of a firm’s reporting controls. Slightly more (43%) foresee that their own management teams will strengthen spreadsheet controls over the next 12 months in response to regulatory and market demands for much stronger data supervision.
Those with a core responsibility on tax are most conscious of the growing interest from regulators, with 68% saying they expect regulators to increase their interest in the use of corporate spreadsheets. This is followed by those in accounting (53%) and risk modelling (51%).
The firm adds that the study comes at a time of intense review of data management processes and how firms hold, manage and authenticate corporate data. Over the past 12 months, regulators worldwide have stepped up demands around spreadsheets and this trend is expected to accelerate into 2014 and beyond. In January 2013 the Basel Committee on Banking Supervision (BCBS) released the report
‘Principles for Effective Risk Data Aggregation and Risk Reporting’
, the first time that spreadsheet management has ever been specifically mandated at such a high level.
“Regulators have begun to understand much more clearly that most businesses, particularly those in the financial services industry, manage much of their data and fundamental corporate information on spreadsheets and similar databases,” said Ralph Baxter, chief executive officer (CEO) at ClusterSeven.
“This has happened because systems such as Excel are easy to use and ubiquitous. However, regulators also understand that there are significant risks involved in using spreadsheets to manage critical information and there has been a substantial increase in the way they and other stakeholders such as auditors are looking at the quality of data and the processes firms employ to manage it.
“Regulators, for instance, are increasingly asking for proof – a data audit trial – that fundamental business data is correct, and the onus is falling on firms to prove the validity of their data and that the processes that underpin processes are adequately safeguarded against errors, miscalculations and fraud.”
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