Spreadsheet Risk
Spreadsheet risk is the risk associated with deriving a materially incorrect value from Excel or a similar spreadsheet application that will be utilised in making a related (usually numerically based) decision. Examples include the valuation of an asset, the determination of financial accounts, the calculation of medicinal doses or the size of load-bearing beam for structural engineering. The risk may arise from inputting erroneous or fraudulent data values, from mistakes (or incorrect changes) within the logic of the spreadsheet or the omission of relevant updates (e.g. out of date exchange rates). Some single-instance errors have exceeded US$1 billion. Because spreadsheet risk is principally linked to the actions (or inaction) of individuals it is defined as a sub-category of operational risk.
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Famous quotes containing the word risk:
“It’s a funny thing, the less people have to live for, the less nerve they have to risk losing—nothing.”
—Zora Neale Hurston (1891–1960)