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How Corporate Finance Executives Use Excel Templates to Make Their Life Easier

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Excel is at the heart of every financial function performed by a business. As part of the Office 365 suite, Excel is used by more than a million businesses worldwide, 731,000 of which in the United States alone depend on it. It’s a versatile and easy-to-use app, and companies are showing no signs of wanting to give it up.

Despite its predominant use, there are limits to the functions of Excel. One of its most notorious limitations is the relative lack of flexibility it offers. When creating a new template, for example, users need to start from scratch by filling the worksheet with data and creating a workbook.

Excel templates provide a shortcut when performing these tasks. Here are some of the most important ways corporate finance professionals use them to launch their models and complete tasks.

Model specific scenarios

What-if analysis is a central part of a company’s financial planning. The financial implications of various hypothetical scenarios shed light on everything from budgeting to cost projections, to cash flow models. Typically, model inputs are adjusted and their results evaluated by financial analysts.

Excel templates for finance include business budget templates that extend up to one year. In addition, business financial analysts also use financial projection spreadsheets which are used to record and track major financial decisions.

For example, a company’s salary costs can be entered into these spreadsheets and edited to show the impact on cash flow at the end of the quarter or year. Thanks to the spreadsheet with pre-filled formulas, viewing the impact of changing variables is simple.

As a result, analysts spend less time entering formulas and more time performing value-added tasks such as modeling variables and projecting financial scenarios.

Create monthly financial views

Monthly closures are a headache just about all businesses, thanks to their hectic nature. No matter how far in advance finance employees collect data, that data always changes and needs to be validated multiple times before it goes to the CFO.

Given the urgent and time-limited nature of this process, it makes sense for departments to use pre-populated templates that require employees to simply enter data. The results of this data can be used to provide a quick overview of financial performance.

Once this data has been exported to consolidated monthly closing models, it can be automatically integrated with numbers from other departments. Therefore, finance employees save time by not defining relationships between cell values ​​every time data enters the consolidated worksheet.

These monthly views can be quickly exported as reports to the CFO for provide instant snapshot of how the company fared. In addition to monthly views, these templates can be modified to accommodate quarterly and semi-annual views, all of which can be consolidated to prepare annual financial statements.

Create easy-to-understand reports

Financial reporting is an important process that must go through intensive audit checks at every stage. Often times, changing the value of a cell in a worksheet is more than just deleting a value and entering something else. Teams should document the rationale for changing these values.

Templates make it easy to document changes with preformatted spreadsheets. Most importantly, they help standardize reporting procedures. When standardized and centralized models are not used, each department follows its own reporting process, making consolidation and reporting across the enterprise all the more difficult.

In these cases, teams have to integrate different formats into a single spreadsheet, which introduces the possibility of errors. Templates dramatically reduce errors because data entry tasks are made that much easier. While some models can be complicated, even these require a user to simply enter data and document the results present on the spreadsheet.

Thus, the reports created with this data are more reliable and consistent. When presenting numbers to senior management, finance teams can easily create new reports as they don’t need to create a format from scratch.

Focus on opportunity analysis

Each company performs a detailed scenario analysis regarding capital allocation. Should they invest in improving an existing product line or should they devote more capital to hiring new employees? These decisions don’t have easy answers, and finance teams spend a lot of time analyzing data.

Given how critical these decisions are, it’s unthinkable that an employee would spend their time creating a new spreadsheet from scratch. Instead, it’s much more efficient to use pre-populated ROI analysis templates and cost-benefit analysis spreadsheets. Once the formulas and formats are loaded and ready to use, all that remains is to enter their projections.

The result is that employees spend more time on actual analysis rather than office work. With this focus on opportunity, companies can make better capital allocation decisions.

Simplify corporate finance

Excel templates help corporate finance employees avoid paperwork and add value to their organizations. While they don’t eliminate the manual labor associated with financial modeling, they certainly shorten the process and help businesses make better financial decisions.

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