A modelling consultancy is making waves in the world of Excel by promoting a standard to simplify financial spreadsheet models.
The FAST Standard promoted by London-based F1F9 advocates a “clear, crisp modelling style” based around the principles of flexibility, accuracy, structure and transparency.
The standard itself, which now boasts seven signatories including accountants Mazars, is a collaborative document hosted on the FAST Modeling Alliance website. The standard discusses the different nature of spreadsheet users, which divide between designers and modellers. Using an automotive analogy, these groups are described as either drivers (users of financial models) or mechanics.
“Rigorous consistency in model layout and organiSation is essential to retain a model’s logical integrity over time, particularly as a model's author may change. A consistent approach to structuring workbooks, worksheets and formulas saves time when building, learning, or maintaining the model,” the standard argues.
“Transparent models must rely on simple, clear formulas that can be understood by other modelers and non-modellers alike.”
In summary, the document promotes the following basic design principles:
- Separate worksheets by type: so that workings, presentation, foundation and control elements of the workbook are stored on different sheets.
- Maintain consistent column structure across sheets
- Maintain consistent time lines throughout the model
- Use links to improve navigation
- Mark exports with red font and imports with blue font
- A given calculation should appear only once in a model
- Use normally positive convention on Workings sheets
- Do not overuse macros.
The final point proved somewhat controversial when F191’s Morten Siersted presented his ideas at the Excel Developer Conference in London on 25 January. To support the FAST Standard initiative, the consultancy has been recording podcasts and publishing them both on its blog and as free downloads from Apple’s iTunes site. Episode 6, for example, features an interview with Professor Ray Panko, the doyen of Excel error research.