UK firms warned over spreadsheet reliance amid cyber risks

UK businesses have been urged to reconsider their continued reliance on spreadsheets for business planning as cybersecurity threats persist and spreadsheet error rates remain high.

Spreadsheet concerns

Half of UK businesses reported a cybersecurity threat in the past year, according to data from the UK Government's Cyber Security Breaches Survey 2024. The challenge is compounded by research indicating that 94% of business-critical spreadsheets contain errors, a risk given their common use in financial forecasting, budgeting, and inventory management.

Michael Gould, Founder of business planning software company Kaleidoscope, has highlighted the risks of continuing to use spreadsheets for planning and decision-making. He said the software, such as Microsoft Excel, was not designed to meet the current demands of collaborative and secure business operations.

"Excel has been a business planning tool for forty years now. But it was built for individuals, not interconnected teams. It's incredibly easy for errors to creep in, and those mistakes can quickly cascade through forecasts, budgets and reports without anyone noticing. It doesn't help teams plan for the future or connect different parts of a business in a structured, auditable way. When critical decisions are stored in spreadsheets sitting on desktops and emailed around, the security and governance risk is simply unacceptable," said Gould. 

Cyber risks

Legacy spreadsheet software, still widely used in UK firms, has been criticised for lacking the security features, access controls, and audit trails demanded by modern compliance frameworks and cyber insurers. The Cyber Security Breaches Survey revealed that while a significant portion of businesses are exposed to cyber threats, only 44% formally review the cyber risks associated with their suppliers. This leaves many companies vulnerable to potential breaches through third-party connections and shared files.

Gould argued that historical reliance on spreadsheets now poses more risk than benefit. He said newer business demands require different tools and approaches.

"Modern businesses run on collaboration, speed and audit-ability, none of which Excel was designed to support. When forecasts or budgets exist in static files without access control or traceability, you're inviting error, non-compliance and even cyber threats. It's time we evolve beyond the spreadsheet era," said Gould.

Industry landscape

Recent reports by finance and technology analysts, including Autorek, support the argument that legacy tools hinder business efficiency and growth. Errors in spreadsheets not only affect internal operations but can have wider regulatory or reputational consequences, especially when these files support vital business decisions.

Business planning platforms, such as Kaleidoscope, aim to address these issues with structured, collaborative, and secure alternatives. Gould noted that there has been a decades-long attachment to spreadsheets within UK companies.

"We've spent decades using spreadsheets as a comfort blanket. But the next generation of planning tools must combine the flexibility business users love with the governance and transparency that regulators, and cyber insurers, increasingly demand," said Gould.