One of the most commonly used tools for Accountants is Microsoft Excel. This article will explore eight essential Excel skills for those who work in accounting to master.
What is Microsoft Excel?
Microsoft Excel is a spreadsheet application that was created to help users organize data and numbers by applying various functions and formulas. Excel places data like formulas, numbers, or text, into cells within columns or rows. It provides a way to organize data as well as perform calculations on it. Excel can also be used to create charts, PivotTables, or graphs that depict data visually.
8 Essential Excel Skills for Accountants
Even though the tools and resources available for Accountants continue to expand, Microsoft Excel remains a staple in this industry. According to Robert Half, 63% of American companies view Microsoft Excel as a crucial tool for the success of their company. In smaller companies, this number is likely even higher. Excel has grown even more in popularity since 2018, when the American Institute of CPAs replaced its proprietary spreadsheet with Excel for exams.
The following list explores some of the core Excel skills Accountants rely on for their daily tasks:
- Creating charts. It’s much easier for most people to understand and remember important information when it’s presented visually. Excel provides several options for data visualization such as graphs and charts. For those who wish to plot time series data such as data that span weeks, months, or even years, bar and line charts are a great option. Pie charts are also available to display the percentage of various components to the whole. They can be created using either percentages or absolute values. In addition, Excel also offers the option for creating scatter plots, which are helpful in instances such as exploring trends. Trend lines can also be added to line or bar charts, as well as scatter plots, to further visualize important data relationships.
- What-if analysis. Accountants draw from a variety of tools to analyze various scenarios, as well as to anticipate what-if cases. Excel provides three options for this type of analysis: goal seek, data tables, and scenario manager. Goal seek iterates each value in a spreadsheet until a specific requirement is met. Data tables provide a way to display multiple scenarios at one time. The scenario manager asks the user to change variables and name them with different scenarios to create new scenarios.
- PivotTables. With the help of PivotTables, Excel users can simplify as well as analyze complicated data. These interactive tables provide a way for Accountants to spot trends and run various comparisons of data. With the help of Excel’s Pivot Table selection in the Data menu, a Wizard function is available that provides options for choosing the data for a Pivot Chart, as well as for formatting it.
- Data validation. This feature allows Accountants to immediately ascertain what type of data a cell holds. It also makes it possible to know if the cell is able to hold any information at all. Essentially, data validation provides Excel users with control over the kind of data that’s entered into a spreadsheet. Data entries can be limited to a selection of those from a dropdown list, or specific types of data entries can be restricted such as numbers that fall outside of a range. In addition, Accountants can customize data validation messages in Excel so that users will be guided toward the correct data entry when they reach a limit. Data validation reduces the occurrence of irrelevant or unstandardized data, as well as errors, on an Accountant’s worksheet.
- Templates. One of Excel’s greatest time-saving features is its vast library of templates. Excel’s template options are available for users who don’t want to start from scratch. A variety of free templates are available to aid with time management, invoicing, amortization scheduling, and budget planning. In addition, those who don’t want to have to search through the library of templates can create their own simply by saving their worksheet as a template.
- Auditing formulas. With the help of Excel’s Auditing toolbar, Accountants are able to quickly access an error-checking function that is especially helpful when working with large and complex worksheets. This function speeds up the process of creating and auditing formulas. A number of options are available in the Formula tab where the Auditing toolbar is found such as tracing formula precedents, locating dependent cells, and formula execution.
- Conditional formatting. One of the main benefits of performing conditional formatting is that it allows Accountants to automatically format the cells whose values satisfy specific conditions. This type of formatting is useful for drawing attention to certain values, or when it’s important to provide an easy-to-spot visual cue that information is important. Conditional formatting is helpful in situations such as when an Accountant must flag the values below the average, or those that are in the bottom 25% of the data on the spreadsheet. It can also be used to color-code commonalities between rows in Excel.
- VLOOKUP. This formula helps Accountants locate data in a table or range based on the row it’s in. For example, an Accountant may need to search through a sheet of data to find names and outstanding balances. VLOOKUP provides a way to locate a specific name and a specific balance. This formula is particularly useful when Accountants are asked to analyze huge datasets.
The above eight uses of Excel are just some of the many applications of this industry-standard spreadsheet tool.
Learn More About Excel with Hands-On Classes
A great way to learn more about how to format in Microsoft Excel is to enroll in one of Noble Desktop’s Excel courses in NYC and live online. Classes are available for those who are new to Excel, as well as learners who regularly work with this spreadsheet application and wish to brush up on their skills. In addition, there are also in-person and live online Excel courses available through Noble Desktop or one of its affiliate schools. A variety of course options are offered, ranging in duration from three hours to two days and costing between $229 and $1,099.
Noble Desktop’s Excel Bootcamp provides a great option for those who want to master core Excel concepts such as creating PivotTables or macros. Students who enroll in this rigorous, 21-hour course can elect to study in-person in Manhattan or learn in the live online environment. This small class comes with the option of a free retake and covers a variety of Excel concepts applicable to the business world.
Those interested in studying close to home can also browse over 400 in-person Microsoft Office classes in a city near you to find local Excel study options.