Auditing and Accounting in A Computer Environment

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Auditing and Accounting in

Computer environment
ALL CONTENTS COPYRIGHT © 2004-2009 H&H ASSOCIATES 1

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Contents
Introduction to computers...........................................................................9
Introduction.........................................................................................9
Introduction of computers in the department........................................10
Computer Skills Joke.........................................................................11
The impact of ICT on economic growth and trade................................11
ICT policy review framework for the information economy....................14
See PowerPoint................................................................................14
What computers can do for you..........................................................14
What computers can’t do for you........................................................15
Potential of IT audit............................................................................15
Computer auditing.............................................................................15
Microsoft excel..................................................................................16
Lesson 1: Entering Text and Numbers................................................17
The Microsoft Excel Window..............................................................17
The Microsoft Office Button................................................................18
The Quick Access Toolbar.................................................................18
The Title Bar......................................................................................18
The Ribbon.......................................................................................18
Worksheets.......................................................................................19
The Formula Bar...............................................................................19
The Status Bar..................................................................................20
Move Around a Worksheet.................................................................20
Go To Cells Quickly...........................................................................21
Select Cells.......................................................................................23
Enter Data......................................................................................... 24

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Edit a Cell.......................................................................................... 25
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Wrap Text.........................................................................................28
Delete a Cell Entry.............................................................................30
Save a File........................................................................................30
Close Excel.......................................................................................30
Lesson 2: Entering Excel Formulas and Formatting Data.....................30
Set the Enter Key Direction................................................................30
Perform Mathematical Calculations....................................................32
AutoSum...........................................................................................36
Perform Automatic Calculations.........................................................37
Align Cell Entries...............................................................................38
Perform Advanced Mathematical Calculations....................................40
Copy, Cut, Paste, and Cell Addressing...............................................41
Insert and Delete Columns and Rows.................................................48
Create Borders..................................................................................51
Merge and Center.............................................................................53
Add Background Color.......................................................................54
Change the Font, Font Size, and Font Color.......................................55
Move to a New Worksheet.................................................................58
Bold, Italicize, and Underline..............................................................59
Work with Long Text..........................................................................62
Change A Column's Width.................................................................63
Format Numbers...............................................................................65
Lesson 3: Creating Excel Functions, Filling Cells, and Printing.............67
Using Reference Operators................................................................67
Understanding Functions...................................................................67
Fill Cells Automatically.......................................................................74
Create Headers and Footers..............................................................78
Set Print Options...............................................................................81
Print.................................................................................................. 83

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Lesson 4: Creating Charts..................................................................86
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Create a Chart...................................................................................87
Apply a Chart Layout.........................................................................88
Add Labels........................................................................................ 89
Switch Data.......................................................................................90
Change the Style of a Chart...............................................................90
Change the Size and Position of a Chart.............................................92
Move a Chart to a Chart Sheet...........................................................92
Change the Chart Type......................................................................93
Performance Management.......................................................................95
Why performance management is important.......................................95
The Importance of Performance Management....................................96
Performance Management.................................................................97
What you will gain from Performance Management.............................98
The individual benefits from using Performance Management.............99
Underlying principles..........................................................................99
Tools of performance management....................................................99
What to measure.............................................................................101
What is a target...............................................................................101
SMART targets................................................................................102
Skills practice..................................................................................103
Targets flow........................................................................................... 104
Balanced scorecard.........................................................................104
Balanced scorecard – factors examples............................................108
Success factors...............................................................................109
Skills practice..................................................................................117
Case Study............................................................................................ 117
Differences in control procedures in a manual and a computer environment117
Appendix – Definitions & Resources.......................................................118
Resources.......................................................................................118

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Basic Computer Skills
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Definitions Related to. ..Computer Skills..............................................120

Introduction to computers
Introduction
Improving your computer skills can help you keep in touch with friends and family, get on
at work or to help with further learning.
THE BENEFITS OF USING A COMPUTER AT WORK
The typical user of computers and information technology (IT) at work is educated, young and female.
She is likelier to work in a large than small company, and has more control over her job than her non-IT
using peers. These are among the findings of research by Peter Dolton and Panu Pelkonen, which has
looked at the incidence of computer use in the workplace and whether it boosts employees’ earnings.
The study also finds that when observable worker characteristic such as age and education, workplace
and occupation are taken into account, workers who use a computer earn between 2.6% and 10%
more. The return to computer use is higher for men than women: for men it is 5-11%, while for women it
is 0-7%.
Computers and IT have changed the way we live and work. The latest Workplace and Employment
Relations Survey 2004 (WERS) provides a snapshot of how using IT at the workplace has changed
working lives in the UK. The study uses this data to provide a description of how IT is used in firms and
assesses the return to earnings generated by the use of this technology.
Various studies have suggested that the use of a computer at work has boosted earnings by as much
as 15-20%. Others suggest that the effect is negligible. This study seeks to clarify the differences in
these estimates using the excellent WERS data. The researchers find that:
* The typical IT user is educated, young and female. She is likelier to work in a large than small
company, and has more control over her job than her non-IT using peers.
* On average, IT users work 3 hours longer weeks than non-IT users, and do not report higher job
satisfaction than their peers without the technology.
* The most common uses of computers are e-mail (59% of workers), word processing (56%), data
entry (45%) and record keeping (44%).
* Computer use is most prevalent in financial services, where 99% use it. The lowest level is in hotels
and restaurants, where 40% use computers.
* The professions in general are divided into those where IT use is very common, and to those where
it is rather uncommon. The professions with highest rates of computer use are among accountants,
lawyers, civil servants, and policemen, 100% of whom use computers.
* Some of the lowest rates of computer use are among cleaners (10%), electricians (26%) and
drivers (28%).
* If individual characteristics and occupation are disregarded, IT users earn on average £10.80 per
hour, while those who do not use IT earn £7.30 per hour.
ALL CONTENTS COPYRIGHT © 2004-2009 H&H ASSOCIATES

* Controlling for a person's characteristics and where they work, then the results show that computer
use boosts earnings and it does so irrespective of the worker's workplace, occupation or industry.
* When observable worker characteristic such as age and education, workplace and occupation are
taken into account, workers who use a computer earn between 2.6-10% more. This is likely to be
explained by the fact that workers with better computer skills land in computer-related jobs, and the
difference in pay reflects such skills.
* The return to computer use is higher for men than women; for men it is 5-11%, while for women it is
0-7%.
Introduction of computers in the department
How computers can help you at work
Communication
Throughout your work you will be expected to communicate with your fellow workers using
your e-mail account. Moreover, fellow workers will often put notes, spreadsheets,
documents and other useful materials into the Intranet (our 'Virtual Working Environment'
which you can access using your username and password).
Research
Computers have become an invaluable research aide; using the Internet you can access
the worlds library catalogue which gives you access to many online (electronic) journals
and databases, as well as the World Wide Web from which you can find useful websites if
you use it with care.
Word Processing
Most departments now expect you to word process your written assignments. You will
need to learn how to use Word effectively; the cut and paste facility allows you to draft
your work more easily; and the word count and spell and grammar check facilities allow for
thorough proofreading.
Preparing Presentations
Most jobs will require you to prepare a presentation either individually or in a group to
promote ideas, changes and defend actions. Computers can help with this, whether it is to
produce a professional-looking poster or to use PowerPoint to create a computer-aided
presentation. You should also look out for specific sessions on presentation skills held in
the Skills Centre
Computer Skills Joke
When Suzy decided to improve her computer skills, she threw herself into it with
enthusiasm. Every week she'd check out two or three instructional books from the library.
After about a month, the librarian commented, "Wow! You must really be getting
knowledgeable at this stuff." "Thanks," Suzy said. "What makes you say that?"

The librarian answered, "Only one of the books you're checking out this week has 'For
Dummies' in the title."
The impact of ICT on economic growth and trade
Experts Confirm ICT as tool for growth and competitiveness in African economies-9 February 2007
A national study on ICTs, trade and economic growth confirmed that economic growth and
competitiveness of an economy can be enhanced through the use of ICTs. According to consultant Dr
Mbui Wagacha, co-author of the study “the use of mobile telephony can contribute approximately 70
Billion Kenyan Shillings (USD 1 billion) to the country’s GDP.
The other co-author of the report Prof. Meoli Kashorda, stated that already 32% of the surveyed Kenyan
businesses were using the web for interaction with clients and/or suppliers while 78.42% used email to
interact with the suppliers and/or clients, making ICT a value chain enhancer.
Providing statistics, the authors of the study confirmed that the benefits of using ICTs in the economy
were higher in developing countries than in more advanced ones. These findings were presented to
Kenyan stakeholders attending the national round table on ICTs, trade and economic growth.
In a message sent to the gathered group of stakeholders, the Permanent Secretary of the Ministry of
Trade and Industry, Mr. David S. Nalo, stated that the advent of Internet implies trade promotion;
facilitation, transactions and payments could all be conducted virtually over a secure Internet Protocol.
Ms Aida Opoku-Mensah, OIC, ISTD, explained the genesis of the study, stating that “this initiative was
part of a series of national studies in six countries, including Kenya being undertaken by ECA and the
Government of Canada under the framework of the Global Electronic Policy Network (ePol-NET),” she
explained.
Mr. Richard Bourassa, Director, International Policy, Industry Canada, highlighted the value of the
stakeholders’ meeting fulfilled the ePol-Net mandate and was the right way for determining the
necessary steps for Kenya to integrate ICTs in specifc and targeted economic sectors.
Mr. Juma Okech, ICT Secretary in the Office of the President, who facilitated the round table thanked
the ECA and the Government of Canada for including Kenya in this groundbreaking study.
The two-day national round table for Kenya opened on 8 February 2007, attended by over thirty
participants including major stakeholders such as bankers, and from the Chamber of Commerce, as
well as the IT and communication private sector, research institutes and various ministries and
agencies. The round table recommendations will be tabled at a high-level meeting of Ministers through
ICT Diffusion to Business: National Peer Reviews
The OECD Growth Study concluded that information and communications technology (ICT) is a key
input to productivity and growth performance. This series of peer reviews on ICT diffusion to business,
undertaken by the Working Party on the Information Economy, responds to the OECD Council
Ministerial request for the OECD to increase its monitoring of member countries’ implementation of the
Growth Study recommendations. The following reports review the status of diffusion of ICT to business
in the respective countries and describe current and previous policies aimed at ICT uptake in firms.

Reports are currently available on Austria, Denmark, Finland, Italy, Korea, Mexico, Norway Switzerland
and the Netherlands. Brief abstracts and links to downloads of each peer review can be found below.
Mexico has made good progress in modernising its economy and has started to successfully address
structural problems including poverty and low levels of human capital. GDP growth is very encouraging,
coupled with low inflation and federal deficits and strong export performance. Social security benefits
have been extended to the very poor, primary school coverage is almost universal, and promising
reforms have been undertaken in citizen services and improving government transparency. The
challenge for Mexico is to take advantage of the very favourable macroeconomic environment to
improve productivity performance and raise living standards across the board and tackle the large
informal job market. ICTs can play an important part in achieving goals by improving economic
performance and increasing competitiveness. Programmes such as e-Mexico which combine
infrastructure development with citizen services are very popular and are a further step in the right
direction. Other programmes, including skills development and support for indigenous firms
(PROSOFT, Fondo PyME), should be strengthened and further focused to improve efficiency and
extend reach to businesses. Better overall planning and priority-setting is needed to provide continuity in
programmes beyond a particular administration and to prioritise initiatives where they can give the
greatest impacts.
Austria is in the middle group of OECD countries in terms of most indicators of information and
communication technology (ICT) infrastructure for business. E-readiness and Internet penetration are
around average, broadband is widely available even if lagging in rural areas, business R&D growing,
Internet banking and e-government applications advanced, although aggregate ICT and knowledge
investments are below average. E-government is well-developed and is a good example of a policy
lever which has important impacts on business and citizens as well as improving government efficiency.
Similarly, electronic payments and electronic signatures are well developed although e-commerce
performance is only average. ICT policy has aimed to sustain relatively good economic performance
and modernise the economy by tackling market distortions and market failures. This has included broad
liberalisation of network services, increased direct public funding and incentives to private spending on
R&D, and initiatives for ICT skills and diffusion. However, co-ordination is a complex and challenging
task in a federal government structure and does not necessarily lead to a centralised approach to ICT
policy and its direction and form. Informal information exchange and programme evaluation practice
may be insufficient to identify and meet emerging challenges, and recent transparent initiatives such as
the White Paper on ICT-related strategy should be continued and strengthened.
The Netherlands has a good ICT infrastructure, consistent market-led policy stance, and a cautious
budget policy, which should provide a stable framework for more focused ICT policies. The OECD
review of the Netherlands recommends that to accelerate diffusion policies need to: increase their
emphasis on strengthening ICT entrepreneurship and improving human capital and pay increasing
attention to ICT skills; foster ICT-related R&D and improve research-industry links; further develop
initiatives to improve business information and advisory services for SMEs, particularly more complex e-
business applications; strengthen recent efforts to increase policy transparency and undertake
systematic policy evaluation; and should re-assess the public sector role and priority given to digital
content creation and use.
Denmark has a very good telecommunication infrastructure and ICT is widely diffused to both
businesses and citizens. The government aims to strengthen Denmark as a knowledge society and the
importance of ICT in reaching this goal is acknowledged by the government. The overall policy
approach to the field of ICT is that developments primarily must take place on private initiative and on
market terms. The role of the public authorities is to remove market failures and create the best
framework for business and citizens. High priority is given to education and research in the ICT area
and policy is innovative in specific areas such as e-government and digital signatures. However the
business structure with a high proportion of small and medium sized firms is a challenge for the policy

making. Building on the strengths in the field of ICT, the report recommends increased priority being
attached to setting quantitative policy goals, promoting common standards, improving the supply of
venture capital, increasing focus on service industries, and improving evaluation.
Finland is well into the diffusion stage of the S-curve of ICT use in business (cf. OECD Information
Technology Outlook 2004, 2002). Levels of basic ICT “readiness” in business are well above the OECD
average and ICT investment both in equipment and ICT skills remains high. However, good past
performance may hide some problem areas such as significant sectoral differences in ICT related
productivity and slow penetration of e.g. new wireless technologies in business use.
Italy: The structural characteristics of the Italian economy have a major role in shaping policies for ICT
diffusion to Italian businesses. The level and speed of diffusion of new technologies are determined by
the sectoral distribution of industry, the small size of businesses, and major regional variations in
industry structure and resources. Overall, the telecommunications infrastructure is good, the growth of
the Internet and broadband has picked up and computerisation is spreading despite the recent poor
economic performance and government budget constraints. There are however a range of constraints
int he business environment and on policies to enhance diffusion of ICTs to business and improve
business performance.
Korea is facing the challenges of moving from high levels of new ICT infrastructure availability to
ensuring effective use and reaping the economic benefits from ICT diffusion to business. It has had very
high rates of growth and labour productivity growth, led by manufacturing, and most recently by R&D-
intensive manufacturing and has high levels of R&D in ICT industries. In terms of ICT diffusion across
the economy, levels of basic ICT “readiness” in telecommunications and PCs are around the OECD
average, although it is clearly the world leader in broadband infrastructure and has high levels of
consumer use. However business diffusion appears uneven despite rapid progress, ICT investment
and use remain around the OECD average in general, and ICT impacts on business may be lower than
expected. This is partly due to the size distribution of Korean business, with small and very small
establishments making up a very high share of total establishments and employing around one-third of
total workers. Less than one half of small businesses had a computer and Internet access, and even
when equipped the smallest often did not use them in business operations and processes. Small
businesses are not fully exploiting the advanced broadband environment, for reasons including
awareness, lack of skilled personnel and lack of specialist services.
Norway: Norway has a good track record in investing in ICT and widely adopting and using ICT and
has developed niche expertise and firms often directly or indirectly linked with the dominant offshore,
maritime, construction and infrastructure sectors. It has a consistent market-led policy stance and
cautious budget policy that ideally would provide a stable framework for more focused ICT policies.
High priority is given to education and a cost-effective public sector, and there is continuing policy
concern regarding the need to shift to a knowledge-intensive economy after oil and gas resources are
exhausted. However, full use of ICT in business lags particularly in broad sections of manufacturing,
and there is evidence that implementation of modern ICT is slower than in neighbouring Nordic
countries, that there is a lower degree of innovativeness in industry and that specific skills to develop e-
business are not sufficient.
Switzerland is well-advanced along the diffusion curve of ICT use in business. Levels of basic
“readiness” (see OECD Information Technology Outlook 2004, 2002) are high, and it is well equipped
with the necessary hardware, both information technology and communications technology. However
diffusion is uneven and ICT impacts on business may be lower than expected based on the average
levels of equipment and diffusion. Switzerland tends to be a follower in embracing fully new
technologies and their application to business rather than an early adopter despite the strong
technology base. This raises the question of whether business in Switzerland makes the best use of the
technologies not only in terms of introducing the hardware but re-engineering processes and business

models to take full advantage of the technologies. Given the relatively lower penetration of PCs in
schools and homes, there may be bottlenecks in terms of skills and familiarity with ICT that could
become impediments to the effective adoption of ICT in business. The federal government's industry
policies generally tend to focus on setting the right framework through improved information flow,
streamlined procedures and demonstration programmes. In this context, the next steps in policy could
be to develop a better picture of shared goals, obstacles and measures needed to improve
performance.the Office of the President.
ICT policy review framework for the information economy
See PowerPoint
Website- http://malawi-tourism-association.org.mw/ict/framework-2002/
What computers can do for you
 Computers enable storage of large data without using much space.
 computers make it easier to manage the company database, accounting, and

finance-related activities,
 computers makes communications among different departments in a company

easy
 For some people with disabilities, computers play a much greater role. Computers
have the potential of equalizing the workplace by enabling people with mobility,
vision, and hearing impairments to do the same work as someone who isn't
handicapped. Some disabled workers have difficulty holding down more than two
keys at once or using a mouse. Blind workers need special translator hardware
so they can read text and numbers. Fortunately, many add-on products are
available to adapt standard microcomputers to the needs of the disabled,
including voice translators for the blind and software that modifies the way the
keyboard and the mouse are used. However, products such as these vary in
sophistication and are usually quite expensive. As a result, very few companies
make these purchases. Aren't these companies discriminating against the
handicapped? Many legislators are actively working to pass a bill that will make
this form of discrimination illegal.
 Computers make it easy to track fraud
 Computers eliminate tedious tasks

What computers can’t do for you
Dreyfus points out major differences between Human's and machine's thought that
Artificial Intelligence research stumbles across time and again:
* Fringe consciousness vs. Heuristically guided search
* Ambiguity tolerance vs. context-free precision
* Essential/inessential discrimination vs. trial-and-error search
* Perspicuous Grouping vs. Character Lists
These difficulties are not coincidental. All work in Cognitive Simulation and in Artificial
Intelligence is predicated on one basic assumption that humans in some fundamental way
process information in ways that computers can emulate. This is no small assumption,
because all computer-based information is explicit, discrete, linear, rule-based and
definitive, while we have no evidence that human thought is so. The assumption that
human minds function like general-purpose symbol-manipulating machines amounts to:
Potential of IT audit
It was not until the late 1970’s that most organisations in the UK established a computer
audit capability.
This primarily arose out of the need to provide business auditors with independent data
from the IT system.
This in turn progressed to a wider review of the IT applications and infrastructure to

provide an assurance that the organisation’s assets were protected and that suitable
security and control mechanisms were in place.
The high level of technical knowledge required resulted in the birth of the computer
auditor.
Computer auditing
It is important when considering computer audit to note that it is an integral part of the
overall audit activity.
It is usually separated to enable specialised security and control issues to be dealt with
more effectively and to make better use of specialist staff.
Computer auditing, therefore, is a means to an end rather than an end in itself. There is
always a temptation when dealing with IT to become engrossed in the technical
complexities of an operating system or application and to ignore the business realities of
the organisation.
Risk based computer auditing, integrated as appropriate with business audit, is essential if
computer audit is to add value to the organisation and to deliver the effective service
demanded of it by senior management. Over the years, the role of the computer auditor
has changed to being more consultative and value adding. Clearly, where a new system is
being developed, it is more cost effective for audit comments to be provided prior to a

system being implemented, when improved security and control features can be included
more easily and cheaply. Similarly, although computer auditors regularly undertake audits
of say logical access controls, there is considerable scope for computer auditors to be
involved in the design of those components.
There is an issue of independence if the computer auditor becomes involved in the design
process as this may be compromised if the same individual subsequently audits that
system. It is generally recognised, however, that the costs of not getting involved are so
great that this is not an option. It is unlikely, for example, that senior management will be
happy to receive an audit report just after a new IT system has gone live which details
significant security and control exposures. The role of the computer auditor continues to
mature and develop. This is essential if computer
Although an IT system may achieve the same end result as a manual system, the way in
which it does so, and hence the level of security and control required, can differ
considerably.
There are a number of significant risks associated with the processing of IT systems. It is
important, therefore, that high standards of security and control are maintained to minimise
the potential impact on the organisation. Computer fraud and abuse can have a
detrimental effect on an organisation.
Periodic surveys undertaken by organisations such as the NCC (National Computing Centre) and the
Audit Commission indicate the following common instances of computer fraud and abuse: •
unauthorised disclosure of confidential information • unavailability of key IT systems • unauthorised
modification/destruction of software • unauthorised modification/destruction of data • theft of IT hardware
and software • use of IT facilities for personal business When considering computer audit, it should be
noted that the basic control objectives and principles do not change. The manner in which those
objectives are achieved, however, does change fundamentally. Specifically, there is a need for greater
preventative controls rather than a reliance on the more detective and corrective control mechanisms
which would usually be found in manual systems. The development of on-line real time systems, where
the immediacy of processing can result in millions of pounds being transferred away in a funds transfer
system, requires a robust level of security.
Microsoft excel
Microsoft Excel is an electronic spreadsheet. As with a paper spreadsheet, you can use
Excel to organize your data into rows and columns and to perform mathematical
calculations. The tutorial teaches you how to create an Excel spreadsheet.
Lesson 1: Entering Text and Numbers
The Microsoft Excel Window
Microsoft Excel is an electronic spreadsheet. You can use it to organize your data into rows and columns. You can
also use it to perform mathematical calculations quickly. This tutorial teaches Microsoft Excel basics. Although

knowledge of how to navigate in a Windows environment is helpful, this tutorial was created for the computer
novice.
This lesson will introduce you to the Excel window. You use the window to interact with Excel. To begin this lesson,
start Microsoft Excel 2007. The Microsoft Excel window appears and your screen looks similar to the one shown
here.
Note: Your screen will probably not look exactly like the screen shown. In Excel 2007, how a window displays
depends on the size of your window, the size of your monitor, and the resolution to which your monitor is set.
Resolution determines how much information your computer monitor can display. If you use a low resolution, less
information fits on your screen, but the size of your text and images are larger. If you use a high resolution, more
information fits on your screen, but the size of the text and images are smaller. Also, settings in Excel 2007,
Windows Vista, and Windows XP allow you to change the color and style of your windows.
The Microsoft Office Button
In the upper-left corner of the Excel 2007 window is the Microsoft Office button. When you click the button, a menu
appears. You can use the menu to create a new file, open an existing file, save a file, and perform many other
tasks.

The Quick Access Toolbar
Next to the Microsoft Office button is the Quick Access toolbar. The Quick Access toolbar gives you with access to
commands you frequently use. By default, Save, Undo, and Redo appear on the Quick Access toolbar. You can
use Save to save your file, Undo to roll back an action you have taken, and Redo to reapply an action you have
rolled back.
The Title Bar
Next to the Quick Access toolbar is the Title bar. On the Title bar, Microsoft Excel displays the name of the
workbook you are currently using. At the top of the Excel window, you should see "Microsoft Excel - Book1" or a
similar name.
The Ribbon
You use commands to tell Microsoft Excel what to do. In Microsoft Excel 2007, you use the Ribbon to issue
commands. The Ribbon is located near the top of the Excel window, below the Quick Access toolbar. At the top of
the Ribbon are several tabs; clicking a tab displays several related command groups. Within each group are
related command buttons. You click buttons to issue commands or to access menus and dialog boxes. You may
also find a dialog box launcher in the bottom-right corner of a group. When you click the dialog box launcher, a
dialog box makes additional commands available.

Worksheets
Microsoft Excel consists of worksheets. Each worksheet contains columns and rows. The columns are lettered A to
Z and then continuing with AA, AB, AC and so on; the rows are numbered 1 to 1,048,576. The number of columns
and rows you can have in a worksheet is limited by your computer memory and your system resources.
The combination of a column coordinate and a row coordinate make up a cell address. For example, the cell
located in the upper-left corner of the worksheet is cell A1, meaning column A, row 1. Cell E10 is located under
column E on row 10. You enter your data into the cells on the worksheet.
The Formula Bar
Formula Bar
If the Formula bar is turned on, the cell address of the cell you are in displays in the Name box which is located on
the left side of the Formula bar. Cell entries display on the right side of the Formula bar. If you do not see the
Formula bar in your window, perform the following steps:
1. Choose the View tab.
2. Click Formula Bar in the Show/Hide group. The Formula bar appears.
Note: The current cell address displays on the left side of the Formula bar.

The Status Bar
The Status bar appears at the very bottom of the Excel window and provides such information as the sum,
average, minimum, and maximum value of selected numbers. You can change what displays on the Status bar by
right-clicking on the Status bar and selecting the options you want from the Customize Status Bar menu. You click
a menu item to select it. You click it again to deselect it. A check mark next to an item means the item is selected.
Move Around a Worksheet
By using the arrow keys, you can move around your worksheet. You can use the down arrow key to move
downward one cell at a time. You can use the up arrow key to move upward one cell at a time. You can use the
Tab key to move across the page to the right, one cell at a time. You can hold down the Shift key and then press
the Tab key to move to the left, one cell at a time. You can use the right and left arrow keys to move right or left
one cell at a time. The Page Up and Page Down keys move up and down one page at a time. If you hold down the
Ctrl key and then press the Home key, you move to the beginning of the worksheet.
EXERCISE 1
Move Around the Worksheet
The Down Arrow Key
 Press the down arrow key several times. Note that the cursor moves downward one cell at a
time.

The Up Arrow Key
 Press the up arrow key several times. Note that the cursor moves upward one cell at a time.
The Tab Key
1. Move to cell A1.
2. Press the Tab key several times. Note that the cursor moves to the right one cell at a time.
The Shift+Tab Keys
 Hold down the Shift key and then press Tab. Note that the cursor moves to the left one cell at
a time.
The Right and Left Arrow Keys
1. Press the right arrow key several times. Note that the cursor moves to the right.
2. Press the left arrow key several times. Note that the cursor moves to the left.
Page Up and Page Down
1. Press the Page Down key. Note that the cursor moves down one page.
2. Press the Page Up key. Note that the cursor moves up one page.
The Ctrl-Home Key
1. Move the cursor to column J.
2. Stay in column J and move the cursor to row 20.
3. Hold down the Ctrl key while you press the Home key. Excel moves to cell A1.
Go To Cells Quickly
The following are shortcuts for moving quickly from one cell in a worksheet to a cell in a different part of the
worksheet.
EXERCISE 2
Go to -- F5
The F5 function key is the "Go To" key. If you press the F5 key, you are prompted for the cell to which you wish to
go. Enter the cell address, and the cursor jumps to that cell.
1. Press F5. The Go To dialog box opens.
2. Type J3 in the Reference field.
3. Press Enter. Excel moves to cell J3.

Go to -- Ctrl+G
You can also use Ctrl+G to go to a specific cell.
1. Hold down the Ctrl key while you press "g" (Ctrl+g). The Go To dialog box opens.
2. Type C4 in the Reference field.
3. Press Enter. Excel moves to cell C4.

The Name Box
You can also use the Name box to go to a specific cell. Just type the cell you want to go to in the Name box and
then press Enter.
1. Type B10 in the Name box.
2. Press Enter. Excel moves to cell B10.

Select Cells
If you wish to perform a function on a group of cells, you must first select those cells by highlighting them. The
exercises that follow teach you how to select.
EXERCISE 3
Select Cells
To select cells A1 to E1:
1. Go to cell A1.
2. Press the F8 key. This anchors the cursor.
3. Note that "Extend Selection" appears on the Status bar in the lower-left corner of the window.
You are in the Extend mode.
4. Click in cell E7. Excel highlights cells A1 to E7.
5. Press Esc and click anywhere on the worksheet to clear the highlighting.
Alternative Method: Select Cells by Dragging
You can also select an area by holding down the left mouse button and dragging the mouse over the area. In
addition, you can select noncontiguous areas of the worksheet by doing the following:

1. Go to cell A1.
2. Hold down the Ctrl key. You won't release it until step 9. Holding down the Ctrl key enables
you to select noncontiguous areas of the worksheet.
3. Press the left mouse button.
4. While holding down the left mouse button, use the mouse to move from cell A1 to C5.
5. Continue to hold down the Ctrl key, but release the left mouse button.
6. Using the mouse, place the cursor in cell D7.
7. Press the left mouse button.
8. While holding down the left mouse button, move to cell F10. Release the left mouse button.
9. Release the Ctrl key. Cells A1 to C5 and cells D7 to F10 are selected.
10. Press Esc and click anywhere on the worksheet to remove the highlighting.
Enter Data
In this section, you will learn how to enter data into your worksheet. First, place the cursor in the cell in which you
want to start entering data. Type some data, and then press Enter. If you need to delete, press the Backspace key
to delete one character at a time.

EXERCISE 4
Enter Data
1. Place the cursor in cell A1.
2. Type John Jordan. Do not press Enter at this time.
Delete Data
The Backspace key erases one character at a time.
1. Press the Backspace key until Jordan is erased.
2. Press Enter. The name "John" appears in cell A1.

Edit a Cell
After you enter data into a cell, you can edit the data by pressing F2 while you are in the cell you wish to edit.

EXERCISE 5
Edit a Cell
Change "John" to "Jones."
1. Move to cell A1.
2. Press F2.
3. Use the Backspace key to delete the "n" and the "h."
4. Type nes.
5. Press Enter.
Alternate Method: Editing a Cell by Using the Formula Bar
You can also edit the cell by using the Formula bar. You change "Jones" to "Joker" in the following exercise.
1. Move the cursor to cell A1.
2. Click in the formula area of the Formula bar.

3. Use the backspace key to erase the "s," "e," and "n."
4. Type ker.
5. Press Enter.
Alternate Method: Edit a Cell by Double-Clicking in the Cell
You can change "Joker" to "Johnson" as follows:
1. Move to cell A1.
2. Double-click in cell A1.
3. Press the End key. Your cursor is now at the end of your text.

3. Use the Backspace key to erase "r," "e," and "k."
4. Type hnson.
5. Press Enter.
Change a Cell Entry
Typing in a cell replaces the old cell entry with the new information you type.
1. Move the cursor to cell A1.
2. Type Cathy.
3. Press Enter. The name "Cathy" replaces "Johnson."
Wrap Text
When you type text that is too long to fit in the cell, the text overlaps the next cell. If you do not want it to overlap
the next cell, you can wrap the text.

EXERCISE 6
Wrap Text
1. Move to cell A2.
2. Type Text too long to fit.
3. Press Enter.
4. Return to cell A2.
5. Choose the Home tab.
6. Click the Wrap Text button . Excel wraps the text in the cell.

Delete a Cell Entry
To delete an entry in a cell or a group of cells, you place the cursor in the cell or select the group of cells and press
Delete.
EXERCISE 7
Delete a Cell Entry
1. Select cells A1 to A2.
2. Press the Delete key.

Save a File
This is the end of Lesson1. To save your file:
1. Click the Office button. A menu appears.
2. Click Save. The Save As dialog box appears.
3. Go to the directory in which you want to save your file.
4. Type Lesson1 in the File Name field.
5. Click Save. Excel saves your file.

Close Excel
Close Microsoft Excel.
2. Click Close. Excel closes.
Lesson 2: Entering Excel Formulas and Formatting Data
Lesson 1 familiarized you with the Excel 2007 window, taught you how to move around the window, and how to
enter data. A major strength of Excel is that you can perform mathematical calculations and format your data. In
this lesson, you learn how to perform basic mathematical calculations and how to format text and numerical data.
To start this lesson, open Excel.
Set the Enter Key Direction
In Microsoft Excel, you can specify the direction the cursor moves when you press the Enter key. In the exercises
that follow, the cursor must move down one cell when you press Enter. You can use the Direction box in the Excel
Options pane to set the cursor to move up, down, left, right, or not at all. Perform the steps that follow to set the
cursor to move down when you press the Enter key.

1. Click the Microsoft Office button. A menu appears.
2. Click Excel Options in the lower-right corner. The Excel Options pane appears.

3. Click Advanced.
4. If the check box next to After Pressing Enter Move Selection is not checked, click the box to
check it.
5. If Down does not appear in the Direction box, click the down arrow next to the Direction box
and then click Down.
6. Click OK. Excel sets the Enter direction to down.

Perform Mathematical Calculations
In Microsoft Excel, you can enter numbers and mathematical formulas into cells. Whether you enter a number or a
formula, you can reference the cell when you perform mathematical calculations such as addition, subtraction,
multiplication, or division. When entering a mathematical formula, precede the formula with an equal sign. Use the
following to indicate the type of calculation you wish to perform:
+ Addition
- Subtraction
* Multiplication
/ Division
^ Exponential
In the following exercises, you practice some of the methods you can use to move around a worksheet and you
learn how to perform mathematical calculations. Refer to Lesson 1 to learn more about moving around a
worksheet.

EXERCISE 1
Addition
1. Type Add in cell A1.
2. Press Enter. Excel moves down one cell.
3. Type 1 in cell A2.
5. Type 1 in cell A3.
7. Type =A2+A3 in cell A4.
8. Click the check mark on the Formula bar. Excel adds cell A1 to cell A2 and displays the result
in cell A4. The formula displays on the Formula bar.
Note: Clicking the check mark on the Formula bar is similar to pressing Enter. Excel records your entry but does
not move to the next cell.

Subtraction
1. Press F5. The Go To dialog box appears.
2. Type B1 in the Reference field.
3. Press Enter. Excel moves to cell B1.
4. Type Subtract.
6. Type 6 in cell B2.

10. Type =B2-B3 in cell B4.
11. Click the check mark on the Formula bar. Excel subtracts cell B3 from cell B2 and the result
displays in cell B4. The formula displays on the Formula bar.
Multiplication
1. Hold down the Ctrl key while you press "g" (Ctrl+g). The Go To dialog box appears.
2. Type C1 in the Reference field.
3. Press Enter. Excel moves to cell C1
4. Type Multiply.
6. Type 2 in cell C2.
10. Type =C2*C3 in cell C4.
11. Click the check mark on the Formula bar. Excel multiplies C1 by cell C2 and displays the result
in cell C3. The formula displays on the Formula bar.
Division
1. Press F5.
2. Type D1 in the Reference field.
3. Press Enter. Excel moves to cell D1.
4. Type Divide.
6. Type 6 in cell D2.
8. Type 3 in cell D3.
10. Type =D2/D3 in cell D4.
11. Click the check mark on the Formula bar. Excel divides cell D2 by cell D3 and displays the
result in cell D4. The formula displays on the Formula bar.
When creating formulas, you can reference cells and include numbers. All of the following formulas are valid:

=A2/B2
=A1+12-B3
=A2*B2+12
=24+53
AutoSum
You can use the AutoSum button on the Home tab to automatically add a column or row of numbers. When
you press the AutoSum button , Excel selects the numbers it thinks you want to add. If you then click the check
mark on the Formula bar or press the Enter key, Excel adds the numbers. If Excel's guess as to which numbers
you want to add is wrong, you can select the cells you want.
EXERCISE 2
AutoSum
The following illustrates AutoSum:
1. Go to cell F1.
2. Type 3.
4. Type 3.

6. Type 3.
7. Press Enter. Excel moves down one cell to cell F4.
9. Click the AutoSum button in the Editing group. Excel selects cells F1 through F3 and
enters a formula in cell F4.
10. Press Enter. Excel adds cells F1 through F3 and displays the result in cell F4.
Perform Automatic Calculations
By default, Microsoft Excel recalculates the worksheet as you change cell entries. This makes it easy for you to
correct mistakes and analyze a variety of scenarios.
EXERCISE 3
Automatic Calculation
Make the changes described below and note how Microsoft Excel automatically recalculates.

1. Move to cell A2.
2. Type 2.
3. Press the right arrow key. Excel changes the result in cell A4. Excel adds cell A2 to cell A3 and
the new result appears in cell A4.
4. Move to cell B2.
5. Type 8.
6. Press the right arrow key. Excel subtracts cell B3 from cell B3 and the new result appears in
cell B4.
7. Move to cell C2.
8. Type 4.
9. Press the right arrow key. Excel multiplies cell C2 by cell C3 and the new result appears in cell
C4.
10. Move to cell D2.
11. Type 12.
12. Press the Enter key. Excel divides cell D2 by cell D3 and the new result appears in cell D4.
Align Cell Entries
When you type text into a cell, by default your entry aligns with the left side of the cell. When you type numbers
into a cell, by default your entry aligns with the right side of the cell. You can change the cell alignment. You can
center, left-align, or right-align any cell entry. Look at cells A1 to D1. Note that they are aligned with the left side of
the cell.
EXERCISE 4
Center
To center cells A1 to D1:

1. Select cells A1 to D1.
3. Click the Center button in the Alignment group. Excel centers each cell's content.
Left-Align
To left-align cells A1 to D1:
1. Select cells A1 to D1.
3. Click the Align Text Left button in the Alignment group. Excel left-aligns each cell's content.
Right-Align
To right-align cells A1 to D1:

1. Select cells A1 to D1. Click in cell A1.
3. Click the Align Text Right button. Excel right-aligns the cell's content.
4. Click anywhere on your worksheet to clear the highlighting.
Note: You can also change the alignment of cells with numbers in them by using the alignment buttons.
Perform Advanced Mathematical Calculations
When you perform mathematical calculations in Excel, be careful of precedence. Calculations are performed from
left to right, with multiplication and division performed before addition and subtraction.
EXERCISE 5
Advanced Calculations
1. Move to cell A7.
2. Type =3+3+12/2*4.
3. Press Enter.
Note: Microsoft Excel divides 12 by 2, multiplies the answer by 4, adds 3, and then adds another 3. The answer,
30, displays in cell A7.
To change the order of calculation, use parentheses. Microsoft Excel calculates the information in parentheses
first.
1. Double-click in cell A7.

2. Edit the cell to read =(3+3+12)/2*4.
3. Press Enter.
Note: Microsoft Excel adds 3 plus 3 plus 12, divides the answer by 2, and then multiplies the result by 4. The
answer, 36, displays in cell A7.
Copy, Cut, Paste, and Cell Addressing
In Excel, you can copy data from one area of a worksheet and place the data you copied anywhere in the same or
another worksheet. In other words, after you type information into a worksheet, if you want to place the same
information somewhere else, you do not have to retype the information. You simple copy it and then paste it in the
new location.
You can use Excel's Cut feature to remove information from a worksheet. Then you can use the Paste feature to
place the information you cut anywhere in the same or another worksheet. In other words, you can move
information from one place in a worksheet to another place in the same or different worksheet by using the Cut and
Paste features.
Microsoft Excel records cell addresses in formulas in three different ways, called absolute, relative, and mixed. The
way a formula is recorded is important when you copy it. With relative cell addressing, when you copy a formula
from one area of the worksheet to another, Excel records the position of the cell relative to the cell that originally
contained the formula. With absolute cell addressing, when you copy a formula from one area of the worksheet to
another, Excel references the same cells, no matter where you copy the formula. You can use mixed cell
addressing to keep the row constant while the column changes, or vice versa. The following exercises
demonstrate.
EXERCISE 6
Copy, Cut, Paste, and Cell Addressing
1. Move to cell A9.
2. Type 1. Press Enter. Excel moves down one cell.
5. Move to cell B9.

In addition to typing a formula as you did in Lesson 1, you can also enter formulas by using Point mode. When you
are in Point mode, you can enter a formula either by clicking on a cell or by using the arrow keys.
1. Move to cell A12.
2. Type =.
3. Use the up arrow key to move to cell A9.
4. Type +.
6. Type +.
8. Click the check mark on the Formula bar. Look at the Formula bar. Note that the formula you
entered is displayed there.
Copy with the Ribbon
To copy the formula you just entered, follow these steps:
1. You should be in cell A12.

3. Click the Copy button in the Clipboard group. Excel copies the formula in cell A12.
4. Press the right arrow key once to move to cell B12.
5. Click the Paste button in the Clipboard group. Excel pastes the formula in cell A12 into
cell B12.
6. Press the Esc key to exit the Copy mode.
Compare the formula in cell A12 with the formula in cell B12 (while in the respective cell, look at the Formula bar).
The formulas are the same except that the formula in cell A12 sums the entries in column A and the formula in cell
B12 sums the entries in column B. The formula was copied in a relative fashion.
Before proceeding with the next part of the exercise, you must copy the information in cells A7 to B9 to cells C7 to
D9. This time you will copy by using the Mini toolbar.

Copy with the Mini Toolbar
1. Select cells A9 to B11. Move to cell A9. Press the Shift key. While holding down the Shift key,
press the down arrow key twice. Press the right arrow key once. Excel highlights A9 to B11.
2. Right-click. A context menu and a Mini toolbar appear.
3. Click Copy, which is located on the context menu. Excel copies the information in cells A9 to
B11.
4. Move to cell C9.
5. Right-click. A context menu appears.
6. Click Paste. Excel copies the contents of cells A9 to B11 to cells C9 to C11.

7. Press Esc to exit Copy mode.
Absolute Cell Addressing
You make a cell address an absolute cell address by placing a dollar sign in front of the row and column identifiers.
You can do this automatically by using the F4 key. To illustrate:
1. Move to cell C12.
2. Type =.
3. Click cell C9.
4. Press F4. Dollar signs appear before the C and the 9.
5. Type +.
6. Click cell C10.
8. Type +.
9. Click cell C11.
11. Click the check mark on the formula bar. Excel records the formula in cell C12.
Copy and Paste with Keyboard Shortcuts
Keyboard shortcuts are key combinations that enable you to perform tasks by using the keyboard. Generally, you
press and hold down a key while pressing a letter. For example, Ctrl+c means you should press and hold down the
Ctrl key while pressing "c." This tutorial notates key combinations as follows:
Press Ctrl+c.
Now copy the formula from C12 to D12. This time, copy by using keyboard shortcuts.
1. Move to cell C12.
2. Hold down the Ctrl key while you press "c" (Ctrl+c). Excel copies the contents of cell C12.
3. Press the right arrow once. Excel moves to D12.

4. Hold down the Ctrl key while you press "v" (Ctrl+v). Excel pastes the contents of cell C12 into
cell D12.
5. Press Esc to exit the Copy mode.
Compare the formula in cell C12 with the formula in cell D12 (while in the respective cell, look at the Formula bar).
The formulas are exactly the same. Excel copied the formula from cell C12 to cell D12. Excel copied the formula in
an absolute fashion. Both formulas sum column C.
Mixed Cell Addressing
You use mixed cell addressing to reference a cell when you want to copy part of it absolute and part relative. For
example, the row can be absolute and the column relative. You can use the F4 key to create a mixed cell
reference.
1. Move to cell E1.
2. Type =.
3. Press the up arrow key once.
4. Press F4.
5. Press F4 again. Note that the column is relative and the row is absolute.
6. Press F4 again. Note that the column is absolute and the row is relative.
7. Press Esc.
Cut and Paste
You can move data from one area of a worksheet to another.

1. Select cells D9 to D12
3. Click the Cut button.
4. Move to cell G1.

5. Click the Paste button . Excel moves the contents of cells D9 to D12 to cells G1 to G4.
The keyboard shortcut for Cut is Ctrl+x. The steps for cutting and pasting with a keyboard shortcut are:
1. Select the cells you want to cut and paste.
2. Press Ctrl+x.
3. Move to the upper-left corner of the block of cells into which you want to paste.
4. Press Ctrl+v. Excel cuts and pastes the cells you selected.
Insert and Delete Columns and Rows
You can insert and delete columns and rows. When you delete a column, you delete everything in the column from
the top of the worksheet to the bottom of the worksheet. When you delete a row, you delete the entire row from left
to right. Inserting a column or row inserts a completely new column or row.
EXERCISE 7
Insert and Delete Columns and Rows
To delete columns F and G:

1. Click the column F indicator and drag to column G.
2. Click the down arrow next to Delete in the Cells group. A menu appears.
3. Click Delete Sheet Columns. Excel deletes the columns you selected.
4. Click anywhere on the worksheet to remove your selection.
To delete rows 7 through 12:

1. Click the row 7 indicator and drag to row 12.
2. Click the down arrow next to Delete in the Cells group. A menu appears.
3. Click Delete Sheet Rows. Excel deletes the rows you selected.
To insert a column:
1. Click on A to select column A.
2. Click the down arrow next to Insert in the Cells group. A menu appears.
3. Click Insert Sheet Columns. Excel inserts a new column.

To insert rows:
1. Click on 1 and then drag down to 2 to select rows 1 and 2.
2. Click the down arrow next to Insert in the Cells group. A menu appears.
3. Click Insert Sheet Rows. Excel inserts two new rows.
Your worksheet should look like the one shown here.

Create Borders
You can use borders to make entries in your Excel worksheet stand out. You can choose from several types of
borders. When you press the down arrow next to the Border button , a menu appears. By making the proper
selection from the menu, you can place a border on the top, bottom, left, or right side of the selected cells; on all
sides; or around the outside border. You can have a thick outside border or a border with a single-line top and a
double-line bottom. Accountants usually place a single underline above a final number and a double underline
below. The following illustrates:
EXERCISE 8
Create Borders
1. Select cells B6 to E6.

3. Click the down arrow next to the Borders button . A menu appears.
4. Click Top and Double Bottom Border. Excel adds the border you chose to the selected cells.

Merge and Center
Sometimes, particularly when you give a title to a section of your worksheet, you will want to center a piece of text
over several columns or rows. The following example shows you how.
EXERCISE 9
Merge and Center
1. Go to cell B2.
2. Type Sample Worksheet.
3. Click the check mark on the Formula bar.
6. Click the Merge and Center button in the Alignment group. Excel merges cells B2, C2,
D2, and E2 and then centers the content.

Note: To unmerge cells:
1. Select the cell you want to unmerge.
3. Click the down arrow next to the Merge and Center button. A menu appears.
4. Click Unmerge Cells. Excel unmerges the cells.

Add Background Color
To make a section of your worksheet stand out, you can add background color to a cell or group of cells.
EXERCISE 10
Add Background Color

3. Click the down arrow next to the Fill Color button .
4. Click the color dark blue. Excel places a dark blue background in the cells you selected.
Change the Font, Font Size, and Font Color
A font is a set of characters represented in a single typeface. Each character within a font is created by using the
same basic style. Excel provides many different fonts from which you can choose. The size of a font is measured
in points. There are 72 points to an inch. The number of points assigned to a font is based on the distance from the
top to the bottom of its longest character. You can change the Font, Font Size, and Font Color of the data you
enter into Excel.

EXERCISE 11
Change the Font
3. Click the down arrow next to the Font box. A list of fonts appears. As you scroll down the list of
fonts, Excel provides a preview of the font in the cell you selected.
4. Find and click Times New Roman in the Font box. Note: If Times New Roman is your default
font, click another font. Excel changes the font in the selected cells.

Change the Font Size
1. Select cell B2.
3. Click the down arrow next to the Font Size box. A list of font sizes appears. As you scroll up or
down the list of font sizes, Excel provides a preview of the font size in the cell you selected.
4. Click 26. Excel changes the font size in cell B2 to 26.

Change the Font Color
3. Click the down arrow next to the Font Color button .
4. Click on the color white. Your font color changes to white.
Your worksheet should look like the one shown here.
Move to a New Worksheet
In Microsoft Excel, each workbook is made up of several worksheets. Each worksheet has a tab. By default, a
workbook has three sheets and they are named sequentially, starting with Sheet1. The name of the worksheet

appears on the tab. Before moving to the next topic, move to a new worksheet. The exercise that follows shows
you how.
EXERCISE 12
Move to a New Worksheet
 Click Sheet2 in the lower-left corner of the screen. Excel moves to Sheet2.
Bold, Italicize, and Underline
When creating an Excel worksheet, you may want to emphasize the contents of cells by bolding, italicizing, and/or
underlining. You can easily bold, italicize, or underline text with Microsoft Excel. You can also combine these
features—in other words, you can bold, italicize, and underline a single piece of text.
In the exercises that follow, you will learn different methods you can use to bold, italicize, and underline.
EXERCISE 13
Bold with the Ribbon
1. Type Bold in cell A1.
2. Click the check mark located on the Formula bar.
4. Click the Bold button . Excel bolds the contents of the cell.

5. Click the Bold button again if you wish to remove the bold.
Italicize with the Ribbon
1. Type Italic in cell B1.
4. Click the Italic button . Excel italicizes the contents of the cell.
5. Click the Italic button again if you wish to remove the italic.
Underline with the Ribbon
Microsoft Excel provides two types of underlines. The exercises that follow illustrate them.
Single Underline:

1. Type Underline in cell C1.
4. Click the Underline button . Excel underlines the contents of the cell.
5. Click the Underline button again if you wish to remove the underline.
Double Underline
1. Type Underline in cell D1.
4. Click the down arrow next to the Underline button and then click Double Underline. Excel
double-underlines the contents of the cell. Note that the Underline button changes to the
button shown here , a D with a double underline under it. Then next time you click the
Underline button, you will get a double underline. If you want a single underline, click the down
arrow next to the Double Underline button and then choose Underline.
5. Click the double underline button again if you wish to remove the double underline.
Bold, Underline, and Italicize
1. Type All three in cell E1.
4. Click the Bold button . Excel bolds the cell contents.

5. Click the Italic button . Excel italicizes the cell contents.
6. Click the Underline button . Excel underlines the cell contents.

Alternate Method: Bold with Shortcut Keys
1. Type Bold in cell A2.
3. Hold down the Ctrl key while pressing "b" (Ctrl+b). Excel bolds the contents of the cell.
4. Press Ctrl+b again if you wish to remove the bolding.

Alternate Method: Italicize with Shortcut Keys
1. Type Italic in cell B2. Note: Because you previously entered the word Italic in column B, Excel
may enter the word in the cell automatically after you type the letter I. Excel does this to speed
up your data entry.
3. Hold down the Ctrl key while pressing "i" (Ctrl+i). Excel italicizes the contents of the cell.
4. Press Ctrl+i again if you wish to remove the italic formatting.

Alternate Method: Underline with Shortcut Keys
1. Type Underline in cell C2.
3. Hold down the Ctrl key while pressing "u" (Ctrl+u). Excel applies a single underline to the cell
contents.
4. Press Ctrl+u again if you wish to remove the underline.

Bold, Italicize, and Underline with Shortcut Keys
1. Type All three in cell D2.
3. Hold down the Ctrl key while pressing "b" (Ctrl+b). Excel bolds the cell contents.
4. Hold down the Ctrl key while pressing "i" (Ctrl+i). Excel italicizes the cell contents.
5. Hold down the Ctrl key while pressing "u" (Ctrl+u). Excel applies a single underline to the cell
contents.
Work with Long Text
Whenever you type text that is too long to fit into a cell, Microsoft Excel attempts to display all the text. It left-aligns
the text regardless of the alignment you have assigned to it, and it borrows space from the blank cells to the right.
However, a long text entry will never write over cells that already contain entries—instead, the cells that contain
entries cut off the long text. The following exercise illustrates this.

EXERCISE 14
Work with Long Text
1. Move to cell A6.
2. Type Now is the time for all good men to go to the aid of their army.
3. Press Enter. Everything that does not fit into cell A6 spills over into the adjacent cell.
4. Move to cell B6.
5. Type Test.
6. Press Enter. Excel cuts off the entry in cell A6.
7. Move to cell A6.
8. Look at the Formula bar. The text is still in the cell.

Change A Column's Width
You can increase column widths. Increasing the column width enables you to see the long text.

EXERCISE 15
Change Column Width
1. Make sure you are in any cell under column A.
3. Click the down arrow next to Format in the Cells group.
4. Click Column Width. The Column Width dialog box appears.
5. Type 55 in the Column Width field.
6. Click OK. Column A is set to a width of 55. You should now be able to see all of the text.
Change a Column Width by Dragging
You can also change the column width with the cursor.
1. Place the mouse pointer on the line between the B and C column headings. The mouse
pointer should look like the one displayed here , with two arrows.
2. Move your mouse to the right while holding down the left mouse button. The width indicator
appears on the screen.

3. Release the left mouse button when the width indicator shows approximately 20. Excel
increases the column width to 20.
Format Numbers
You can format the numbers you enter into Microsoft Excel. For example, you can add commas to separate
thousands, specify the number of decimal places, place a dollar sign in front of a number, or display a number as a
percent.
EXERCISE 16
Format Numbers
1. Move to cell B8.
2. Type 1234567.
3. Click the check mark on the Formula bar.

5. Click the down arrow next to the Number Format box. A menu appears.
6. Click Number. Excel adds two decimal places to the number you typed.
7. Click the Comma Style button . Excel separates thousands with a comma.
8. Click the Accounting Number Format button . Excel adds a dollar sign to your number.
9. Click twice on the Increase Decimal button to change the number format to four decimal
places.
10. Click the Decrease Decimal button if you wish to decrease the number of decimal places.
Change a decimal to a percent.
1. Move to cell B9.
2. Type .35 (note the decimal point).

3. Click the check mark on the formula bar.
5. Click the Percent Style button . Excel turns the decimal to a percent.
This is the end of Lesson 2. You can save and close your file. See Lesson 1 to learn how to save and close a file.
Lesson 3: Creating Excel Functions, Filling Cells, and Printing
By using functions, you can quickly and easily make many useful calculations, such as finding an average, the
highest number, the lowest number, and a count of the number of items in a list. Microsoft Excel has many
functions that you can use.
Using Reference Operators
To use functions, you need to understand reference operators. Reference operators refer to a cell or a group of
cells. There are two types of reference operators: range and union.
A range reference refers to all the cells between and including the reference. A range reference consists of two cell
addresses separated by a colon. The reference A1:A3 includes cells A1, A2, and A3. The reference A1:C3
includes cells A1, A2, A3, B1, B2, B3, C1, C2, and C3.
A union reference includes two or more references. A union reference consists of two or more numbers, range
referneces, or cell addresses separated by a comma. The reference A7,B8:B10,C9,10 refers to cells A7, B8 to
B10, C9 and the number 10.
Understanding Functions
Functions are prewritten formulas. Functions differ from regular formulas in that you supply the value but not the
operators, such as +, -, *, or /. For example, you can use the SUM function to add. When using a function,
remember the following:
Use an equal sign to begin a formula.

Specify the function name.
Enclose arguments within parentheses. Arguments are values on which you want to perform the calculation. For
example, arguments specify the numbers or cells you want to add.
Use a comma to separate arguments.
Here is an example of a function:
=SUM(2,13,A1,B2:C7)
In this function:
The equal sign begins the function.
SUM is the name of the function.
2, 13, A1, and B2:C7 are the arguments.
Parentheses enclose the arguments.
Commas separate the arguments.
After you type the first letter of a function name, the AutoComplete list appears. You can double-click on an item in
the AutoComplete list to complete your entry quickly. Excel will complete the function name and enter the first
parenthesis.
EXERCISE 1
Functions
The SUM function adds argument values.
1. Open Microsoft Excel.
3. Press Enter.
5. Press Enter.

7. Press Enter.
8. Type =SUM(B1:B3) in cell A4.
9. Press Enter. The sum of cells B1 to B3, which is 63, appears.

Alternate Method: Enter a Function with the Ribbon
2. Press Enter.
4. Press Enter.
6. Choose the Formulas tab.
7. Click the Insert Function button. The Insert Function dialog box appears.
8. Choose Math & Trig in the Or Select A Category box.
9. Click Sum in the Select A Function box.
10. Click OK. The Function Arguments dialog box appears.

12. Type C1:C3 in the Number1 field, if it does not automatically appear.
13. Click OK. The sum of cells C1 to C3, which is 300, appears.
Format worksheet
1. Move to cell A4.
2. Type the word Sum.
3. Select cells B4 to C4.
5. Click the down arrow next to the Borders button .
6. Click Top and Double Bottom Border.
As you learned in Lesson 2, you can also calculate a sum by using the AutoSum button .
Calculate an Average
You can use the AVERAGE function to calculate the average of a series of numbers.

1. Move to cell A6.
2. Type Average. Press the right arrow key to move to cell B6.
3. Type =AVERAGE(B1:B3).
4. Press Enter. The average of cells B1 to B3, which is 21, appears.

Calculate an Average with the AutoSum Button
In Microsoft Excel, you can use the AutoSum button to calculate an average.
1. Move to cell C6.
3. Click the down arrow next to the AutoSum button .
4. Click Average.

5. Select cells C1 to C3.
6. Press Enter. The average of cells C1 to C3, which is 100, appears.

Find the Lowest Number
You can use the MIN function to find the lowest number in a series of numbers.
1. Move to cell A7.
2. Type Min.
3. Press the right arrow key to move to cell B7.
4. Type = MIN(B1:B3).
5. Press Enter. The lowest number in the series, which is 12, appears.
Note: You can also use the drop-down button next to the AutoSum button to calculate minimums,
maximums, and counts.
Find the Highest Number
You can use the MAX function to find the highest number in a series of numbers.

.
1. Move to cell A8.
2. Type Max.
4. Type = MAX(B1:B3).
5. Press Enter. The highest number in the series, which is 27, appears.
Count the Numbers in a Series of Numbers
You can use the count function to count the number of numbers in a series.
1. Move to cell A9.
2. Type Count.
5. Click the down arrow next to the AutoSum button .
6. Click Count Numbers. Excel places the count function in cell C9 and takes a guess at which
cells you want to count. The guess is incorrect, so you must select the proper cells.

7. Select B1 to B3.
8. Press Enter. The number of items in the series, which is 3, appears.
Fill Cells Automatically
You can use Microsoft Excel to fill cells automatically with a series. For example, you can have Excel automatically
fill your worksheet with days of the week, months of the year, years, or other types of series.
EXERCISE 2
Fill Cells Automatically
The following demonstrates filling the days of the week:

1. Click the Sheet2 tab. Excel moves to Sheet2.
2. Move to cell A1.
3. Type Sun.
4. Move to cell B1.
5. Type Sunday.
6. Select cells A1 to B1.
8. Click the Bold button . Excel bolds cells A1 to B1.
9. Find the small black square in the lower-right corner of the selected area. The small black
square is called the fill handle.

10. Grab the fill handle and drag with your mouse to fill cells A1 to B14. Note how the days of the
week fill the cells in a series. Also, note that the Auto Fill Options button appears.
Copy Cells
1. Click the Auto Fill Options button. The Auto Fill Options menu appears.

2. Choose the Copy Cells radio button. The entry in cells A1 and B1 are copied to all the
highlighted cells.
3. Click the Auto Fill Options button again.
4. Choose the Fill Series radio button. The cells fill as a series from Sunday to Saturday again.
6. Choose the Fill Without Formatting radio button. The cells fill as a series from Sunday to
Saturday, but the entries are not bolded.
8. Choose the Fill Weekdays radio button. The cells fill as a series from Monday to Friday.
Adjust Column Width
Some of the entries in column B are too long to fit in the column. You can quickly adjust the column width to fit the
longest entry.
1. Move your mouse pointer over the line that separates column B and C. The Width Indicator
appears.
2. Double-click. The Column adjusts to fit the longest entry.
After you complete the remainder of the exercise, your worksheet will look like the one shown here.

Fill Times
The following demonstrates filling time:
1. Type 1:00 into cell C1.
2. Grab the fill handle and drag with your mouse to highlight cells C1 to C14. Note that each cell
fills, using military time.
3. Press Esc and then click anywhere on the worksheet to remove the highlighting.
To change the format of the time:
1. Select cells C1 to C14.
3. Click the down arrow next to the number format box . A menu appears.
4. Click Time. Excel changes the format of the time.

Fill Numbers
You can also fill numbers.
Type a 1 in cell D1.
1. Grab the fill handle and drag with your mouse to highlight cells D1 to D14. The number 1 fills
each cell.
2. Click the Auto Fill Options button.
3. Choose the Fill Series radio button. The cells fill as a series, starting with 1, 2, 3.
Here is another interesting fill feature.
1. Go to cell E1.
2. Type Lesson 1.
3. Grab the fill handle and drag with your mouse to highlight cells E1 to E14. The cells fill in as a
series: Lesson 1, Lesson 2, Lesson 3, and so on.
Create Headers and Footers
You can use the Header & Footer button on the Insert tab to create headers and footers. A header is text that
appears at the top of every page of your printed worksheet. A footer is text that appears at the bottom of every
page of your printed worksheet. When you click the Header & Footer button, the Design context tab appears and
Excel changes to Page Layout view. A context tab is a tab that only appears when you need it. Page Layout view
structures your worksheet so that you can easily change the format of your document. You usually work in Normal
view.
You can type in your header or footer or you can use predefined headers and footers. To find predefined headers
and footers, click the Header or Footer button or use the Header & Footer Elements group's buttons. When you

choose a header or footer by clicking the Header or Footer button, Excel centers your choice. The table shown
here describes each of the Header & Footer Elements group button options.
Header & Footer Elements
Button Purpose
Page Number Inserts the page number.
Inserts the number of pages in the

Number of Pages
document.
Current Time Inserts the current time.
File Path Inserts the path to the document.
File Name Inserts the file name.
Sheet Name Inserts the name of the worksheet.
Picture Enables you to insert a picture.
Both the header and footer areas are divided into three sections: left, right, and center. When you choose a
Header or Footer from the Header & Footer Elements group, where you place your information determines
whether it appears on the left, right, or center of the printed page. You use the Go To Header and Go To Footer
buttons on the Design tab to move between the header and footer areas of your worksheet.
EXERCISE 3
Insert Headers and Footers
1. Choose the Insert tab.
2. Click the Header & Footer button in the Text group. Your worksheet changes to Page Layout
view and the Design context tab appears. Note that your cursor is located in the center section
of the header area.

3. Click the right side of the header area.
4. Click Page Number in the Header & Footer Elements group. When you print your document,
Excel will place the page number in the upper-right corner.
5. Click the left side of the Header area.
6. Type your name. When you print your document, Excel will place your name in the upper-left
corner.
7. Click the Go To Footer button. Excel moves to the footer area.
8. Click the Footer button. A menu appears.
9. Click the path to your document. Excel will place the path to your document at the bottom of
every printed page.
Return to Normal View
To return to Normal view:

1. Choose the View tab.
2. Click the Normal button in the Workbook Views group.

Set Print Options
There are many print options. You set print options on the Page Layout tab. Among other things, you can set your
margins, set your page orientation, and select your paper size.
Margins define the amount of white space that appears on the top, bottom, left, and right edges of your document.
The Margin option on the Page Layout tab provides several standard margin sizes from which you can choose.
There are two page orientations: portrait and landscape. Paper, such as paper sized 8 1/2 by 11, is longer on one
edge than it is on the other. If you print in Portrait, the shortest edge of the paper becomes the top of the page.
Portrait is the default option. If you print in Landscape, the longest edge of the paper becomes the top of the page.
Portrait
Landscape
Paper comes in a variety of sizes. Most business correspondence uses 8 1/2 by 11 paper, which is the default
page size in Excel. If you are not using 8 1/2 by 11 paper, you can use the Size option on the Page Layout tab to
change the Size setting.
EXERCISE 4
Set the Page Layout
1. Choose the Page Layout tab.
2. Click Margins in the Page Setup group. A menu appears.

3. Click Wide. Word sets your margins to the Wide settings.
Set the Page Orientation
2. Click Orientation in the Page Setup group. A menu appears.
3. Click Landscape. Excel sets your page orientation to landscape.

Set the Paper Size

2. Click Size in the Page Setup group. A menu appears.
3. Click the paper size you are using. Excel sets your page size.
Print
The simplest way to print is to click the Office button, highlight Print on the menu that appears, and then click Quick
Print in the Preview and Print the Document pane. Dotted lines appear on your screen, and your document prints.
The dotted lines indicate the right, left, top, and bottom edges of your printed pages.
You can also use the Print Preview option to print. When using Print Preview, you can see onscreen how your
printed document will look when you print it. If you click the Page Setup button while in Print Preview mode, you
can set page settings such as centering your data on the page.
If your document is several pages long, you can use the Next Page and Previous Page buttons to move forward
and backward through your document. If you check the Show Margins check box, you will see margin lines on your
document. You can click and drag the margin markers to increase or decrease the size of your margins. To return
to Excel, click the Close Print Preview button.
You click the Print button when you are ready to print. The Print dialog box appears. You can choose to print the
entire worksheet or specific pages. If you want to print specific pages, enter the page numbers in the From and To
fields. You can enter the number of copies you want to print in the Number of Copies field.

EXERCISE 5
Open Print Preview
2. Highlight Print. The Preview and Print The Document pane appears.
3. Click Print Preview. The Print Preview window appears, with your document in the center.

Center Your Document
1. Click the Page Setup button in the Print group. The Page Setup dialog box appears.
2. Choose the Margins tab.
3. Click the Horizontally check box. Excel centers your data horizontally.
4. Click the Vertically check box. Excel centers your data vertically.
5. Click OK. The Page Setup dialog box closes.

Print
1. Click the Print button. The Print dialog box appears.
2. Click the down arrow next to the name field and select the printer to which you want to print.
3. Click OK. Excel sends your worksheet to the printer.
This is the end of Lesson 3. You can save and close your file.
Lesson 4: Creating Charts
Previous Page Table of Contents Next Page

In Microsoft Excel, you can represent numbers in a chart. On the Insert tab, you can choose from a variety of chart
types, including column, line, pie, bar, area, and scatter. The basic procedure for creating a chart is the same no
matter what type of chart you choose. As you change your data, your chart will automatically update.

Create a Chart
You select a chart type by choosing an option from the Insert tab's Chart group. After you choose a chart type,
such as column, line, or bar, you choose a chart sub-type. For example, after you choose Column Chart, you can
choose to have your chart represented as a two-dimensional chart, a three-dimensional chart, a cylinder chart, a
cone chart, or a pyramid chart. There are further sub-types within each of these categories. As you roll your mouse
pointer over each option, Excel supplies a brief description of each chart sub-type.
To create the column chart shown above, start by creating the worksheet below exactly as shown.
After you have created the worksheet, you are ready to create your chart.

EXERCISE 1
Create a Column Chart
1. Select cells A3 to D6. You must select all the cells containing the data you want in your chart.
You should also include the data labels.
2. Choose the Insert tab.
3. Click the Column button in the Charts group. A list of column chart sub-types types appears.
4. Click the Clustered Column chart sub-type. Excel creates a Clustered Column chart and the
Chart Tools context tabs appear.
Apply a Chart Layout
Context tabs are tabs that only appear when you need them. Called Chart Tools, there are three chart context
tabs: Design, Layout, and Format. The tabs become available when you create a new chart or when you click on a
chart. You can use these tabs to customize your chart.
You can determine what your chart displays by choosing a layout. For example, the layout you choose determines
whether your chart displays a title, where the title displays, whether your chart has a legend, where the legend
displays, whether the chart has axis labels and so on. Excel provides several layouts from which you can choose.

EXERCISE 2
Apply a Chart Layout
1. Click your chart. The Chart Tools become available.
2. Choose the Design tab.
3. Click the Quick Layout button in the Chart Layout group. A list of chart layouts appears.
4. Click Layout 5. Excel applies the layout to your chart.

Add Labels
When you apply a layout, Excel may create areas where you can insert labels. You use labels to give your chart a
title or to label your axes. When you applied layout 5, Excel created label areas for a title and for the vertical axis.
EXERCISE 3
Add labels
Before After
1. Select Chart Title. Click on Chart Title and then place your cursor before the C in Chart and
hold down the Shift key while you use the right arrow key to highlight the words Chart Title.

2. Type Toy Sales. Excel adds your title.
3. Select Axis Title. Click on Axis Title. Place your cursor before the A in Axis. Hold down the
Shift key while you use the right arrow key to highlight the words Axis Title.
4. Type Sales. Excel labels the axis.
5. Click anywhere on the chart to end your entry.

Switch Data
If you want to change what displays in your chart, you can switch from row data to column data and vice versa.
EXERCISE 4
Switch Data
Before After
3. Click the Switch Row/Column button in the Data group. Excel changes the data in your chart.
Change the Style of a Chart
A style is a set of formatting options. You can use a style to change the color and format of your chart. Excel 2007
has several predefined styles that you can use. They are numbered from left to right, starting with 1, which is
located in the upper-left corner.

EXERCISE 5
Change the Style of a Chart
3. Click the More button in the Chart Styles group. The chart styles appear.
4. Click Style 42. Excel applies the style to your chart.

Change the Size and Position of a Chart
When you click a chart, handles appear on the right and left sides, the top and bottom, and the corners of the
chart. You can drag the handles on the top and bottom of the chart to increase or decrease the height of the chart.
You can drag the handles on the left and right sides to increase or decrease the width of the chart. You can drag
the handles on the corners to increase or decrease the size of the chart proportionally. You can change the
position of a chart by clicking on an unused area of the chart and dragging.
EXERCISE 6
Change the Size and Position of a Chart
1. Use the handles to adjust the size of your chart.
2. Click an unused portion of the chart and drag to position the chart beside the data.
Move a Chart to a Chart Sheet
By default, when you create a chart, Excel embeds the chart in the active worksheet. However, you can move a
chart to another worksheet or to a chart sheet. A chart sheet is a sheet dedicated to a particular chart. By default
Excel names each chart sheet sequentially, starting with Chart1. You can change the name.

EXERCISE 7
Move a Chart to a Chart Sheet
3. Click the Move Chart button in the Location group. The Move Chart dialog box appears.
4. Click the New Sheet radio button.
5. Type Toy Sales to name the chart sheet. Excel creates a chart sheet named Toy Sales and
places your chart on it.
Change the Chart Type
Any change you can make to a chart that is embedded in a worksheet, you can also make to a chart sheet. For
example, you can change the chart type from a column chart to a bar chart.

EXERCISE 8
Change the Chart Type
3. Click Change Chart Type in the Type group. The Chart Type dialog box appears.
4. Click Bar.
5. Click Clustered Horizontal Cylinder.
6. Click OK. Excel changes your chart type.

You have reached the end of Lesson 4. You can save and close your file.
About consolidating data
To summarize and report results from multiple worksheets, you can consolidate data from each worksheet into a
master worksheet. The worksheets can be in the same workbook or other workbooks. When you consolidate data,
you are assembling data so you can more easily update and aggregate it on a regular or ad hoc basis.
For example, if you have a worksheet of expense figures for each of your regional offices, you might use a
consolidation to roll up these figures into a corporate expense worksheet. This master worksheet might contain
sales totals and averages, current inventory levels, and highest selling products for the entire enterprise.
To consolidate data, you use the Consolidate command from the Data menu to display the Consolidate dialog box.
You can use this dialog box in several ways to consolidate your data:
Position Use this approach when the data in all worksheets is arranged in identical order and location.
1. Set up the data to be consolidated on each separate worksheet.
How?
2. Click the upper-left cell of the area where you want the consolidated data to appear in the master worksheet.
NOTE Make sure that you leave enough cells to the right and below this cell for the consolidated data. The Consolidate command populates the area as needed.
3. On the Data menu, click Consolidate.
4. In the Function box, click the summary function that you want Microsoft Office Excel to use to consolidate the data.
5. If the worksheet is in another workbook, click Browse to locate the file, and then click OK to close the Browse dialog box.
The file path is entered in the Reference box followed by an exclamation point.
6. Type the name that you gave the range, and then click Add. Repeat this step for each range.
7. Decide how you want to update the consolidation. Do one of the following:
 To set up the consolidation so that it updates automatically when the source data changes, select the Create links to source data check box.
IMPORTANT You can only select this check box if the worksheet is in another workbook. Once you select this check box, you won't be able to change which cells and ranges are included in the consolidation.

 To set up the consolidation so that you can update the consolidation manually by changing the included cells and ranges, clear the Create links to source data check box.
8. Leave the boxes under Use labels in blank. Excel does not copy the row or column labels in the source ranges to the consolidation. If you want labels for the consolidated data, copy them from one of the source ranges or enter
them manually.
Category Use this approach when each worksheet organizes the data differently, but has the same row and
column labels, which you can use to match the data.
1. Set up the data to be consolidated on each separate worksheet.
How?
2. Click the upper-left cell of the area where you want the consolidated data to appear in the master worksheet.
NOTE Make sure that you leave enough cells to the right and below this cell for the consolidated data. The Consolidate command populates the area as needed.
3. On the Data menu, click Consolidate.
4. In the Function box, click the summary function that you want Excel to use to consolidate the data.
5. If the worksheet is in another workbook, click Browse to locate the file, and then click OK to close the Browse dialog box.
The file path is entered in the Reference box followed by an exclamation point.
6. Type the name you gave the range, and then click Add. Repeat this step for each range.
7. Decide how you want to update the consolidation. Do one of the following:
 To set up the consolidation so that it updates automatically when the source data changes, select the Create links to source data check box.
IMPORTANT You can only select this check box if the worksheet is in another workbook. Once you select this check box, you won't be able to change which cells and ranges are included in the consolidation.
 To set up the consolidation so that you can update the consolidation manually by changing the included cells and ranges, clear the Create links to source data check box.
8. Select the check boxes under Use labels in that indicate where the labels are located in the source ranges: either the Top row, the Left column, or both.
3-D formulas Use this approach when the worksheets do not have a consistent pattern you can rely on. You can
create formulas that refer to cells in each range of data that you're combining. Formulas that refer to cells on
multiple worksheets are called 3-D formulas.
1. On the master worksheet, copy or enter the column or row labels that you want for the consolidated data.
2. Click a cell that you want to contain consolidated data.
3. Type a formula that includes a cell reference to the source cells on each worksheet or a 3-D reference that contains data that you want to consolidate. Regarding cell references, do one of the
following:
If the data to consolidate is in different cells on different worksheets
 Enter a formula with cell references to the other worksheets, one for each separate worksheet. For example, to consolidate data from worksheets named Sales (in cell B4), HR (in cell F5), and
Marketing (in cell B9), in cell A2 of the master worksheet, you would enter the following:
Tip To enter a cell reference, such as Sales!B4, in a formula without typing, type the formula up to the point where you need the reference, click the worksheet tab, and then click the cell.
If the data to consolidate is in the same cells on different worksheets
 Enter a formula with a 3-D reference that uses a reference to a range of worksheet names. For example, to consolidate data in cells A2 from Sales through Marketing inclusive, in cell A2 of the master
worksheet you would enter the following:
NOTE If the workbook is set to automatically calculate formulas, a consolidation by formula always updates automatically when the data in the separate worksheets change.

Performance Management
Why performance management is important
In their definitive text upon which this factsheet is based, Armstrong and Baron define
performance management as 'a process which contributes to the effective management of
individuals and teams in order to achieve high levels of organisational performance. As
such, it establishes shared understanding about what is to be achieved and an approach
to leading and developing people which will ensure that it is achieved'. They go on to
stress that it is 'a strategy which relates to every activity of the organisation set in the
context of its human resource policies, culture, style and communications systems. The
nature of the strategy depends on the organisational context and can vary from
organisation to organisation.'
In other words performance management should be:
* Strategic - it is about broader issues and longer-term goals
* Integrated - it should link various aspects of the business, people management, and
individuals and teams.
It should incorporate:
* Performance improvement - throughout the organisation, for individual, team and

organisational effectiveness
* Development - unless there is continuous development of individuals and teams,

performance will not improve
* Managing behaviour - ensuring that individuals are encouraged to behave in a way

that allows and fosters better working relationships.
Armstrong and Baron stress that at its best performance management is a tool to ensure
that managers manage effectively; that they ensure the people or teams they manage:
* know and understand what is expected of them
* have the skills and ability to deliver on these expectations
* are supported by the organisation to develop the capacity to meet these expectations
are given feedback on their performance

* have the opportunity to discuss and contribute to individual and team aims and
objectives.
It is also about ensuring that managers themselves are aware of the impact of their own
behaviour on the people they manage and are encouraged to identify and exhibit positive
behaviours.
So performance management is about establishing a culture in which individuals and

groups take responsibility for the continuous improvement of business processes and of
their own skills, behaviour and contributions. It is about sharing expectations. Managers
can clarify what they expect individual and teams to do; likewise individuals and teams can
communicate their expectations of how they should be managed and what they need to
do their jobs. It follows that performance management is about interrelationships and
about improving the quality of relationships - between managers and individuals, between
managers and teams, between members of teams and so on, and is therefore a joint
process. It is also about planning - defining expectations expressed as objectives and in
business plans - and about measurement; the old dictum is 'If you can't measure it, you
can't manage it'. It should apply to all employees, not just managers, and to teams as
much as individuals. It is a continuous process, not a one-off event. Last but not least, it is
holistic and should pervade every aspect of running an organisation.
The Importance of Performance Management
Redundancies are common place, globalisation is the norm, change is constant and jobs are
not for life. Employees along with their skills and knowledge move more frequently from one
competitor to another. Organisations ignore the adage “people are a company’s best asset” at
their peril.
Recognising, valuing and developing individuals’ input encourages strong performance, thus
leading to profitability for the organisation. Performance Management processes, implemented
effectively, address both the needs of the organisation and those of the employee.
Sadly so many attempts at performance management have resulted in managers and staff
resenting the process. It’s viewed as too complicated or too bureaucratic or a tool to beat poor
performers with!
The philosophy is to keep the processes, tool and systems as simple as possible thus
optimising their effectiveness. The organisation receives the management information it needs
to progress and individuals realise the value of their participation in the process.
Essentially Performance Management can be broken down on to three key elements:

These 3 areas can be broken down further to describe the types of tools and processes MaST
provides for each element of Performance Management.
Performance Management
Maximising Performance

Talent Management
What you will gain from Performance Management
 Employee alignment to company/ departmental / team strategy
 Increased capability
 Cost efficiency
 Competitive in the market place
 Flexibility to move with change
 Motivated workforce
 Higher level of staff retention
 Valuable management information

The individual benefits from using Performance Management
 Extrinsic reward i.e. financial
 Intrinsic reward i.e. praise
 Self development
 Career opportunities
 Involvement
 Clarity
 Sense of purpose

Underlying principles
Because performance management is (or should be) so all-pervasive, it needs structures

to support it. These should provide a framework to help people operate, and to help them
to help others to operate. But it should not be a rigid system; there needs to be a
reasonable degree of flexibility to allow people freedom to operate.
Performance management is a process, not an event. It operates as a continuous cycle.
Corporate strategic goals provide the starting point for business and departmental goals,
followed by agreement on performance and development, leading to the drawing up of
plans between individuals and managers, with continuous monitoring and feedback
supported by formal reviews.
Tools of performance management
It is impossible to go into details of each of the tools used by performance management,

so the following paragraphs simply provide an outline.
Performance and development reviews

Many organisations without performance management systems operate 'appraisals' in
which an individual's manager regularly (usually annually) records performance, potential
and development needs in a top-down process - see our factsheet on performance
appraisal for more information on this topic.
It can be argued that the perceived defects of appraisal systems (that line managers
regarded them as irrelevant, involving form-filling to keep the personnel department
happy, and not as a normal process of management) led to the development of more
rounded concepts of performance management. Nevertheless, organisations with
performance management systems need to provide those involved with the opportunity to
reflect on past performance as a basis for making development and improvement plans,
and the performance and development review meeting (note the terminology; it is not
appraisal) provides this chance. The meeting must be constructive, and various
techniques can be used to conduct the sort of open, free-flowing and honest meeting
needed, with the reviewed doing most of the talking.
Learning and development

Employee development is the main route followed by most organisations to improved
organisational performance, which in turn requires an understanding of the processes and
techniques of organisational, team and individual learning. Performance reviews can be
regarded as learning events, in which individuals can be encouraged to think about how
and in which ways they want to develop. This can lead to the drawing up of a personal
development plan (PDP) setting out the actions they propose to take (with the help of
others, not least their managers) to develop themselves. To keep development separate
from performance and salary discussions, development reviews may be held at other
times, for example, on the anniversary of joining an organisation.
Increasing emphasis on talent management also means that many organisations are re-
defining performance management to align it to the need to identify, nurture and retain

talent. Development programmes are reflecting the needs of succession plans and
seeking to foster leadership skills. However, too much of an emphasis on talent
management may be damaging to overall development needs and every effort needs to
be made to ensure that development is inclusive, accessible and focused on developing
organisational capability.
Coaching
Coaching is an important tool in learning and development. Coaching is developing a
person's skills and knowledge so that their job performance improves, leading to the
achievement of organisational objectives. Coaching is increasingly recognised as a
significant responsibility of line managers, and can play an important part in a PDP. They
will take place during the review meetings, but also and more importantly should be
carried out throughout the year. For some managers coaching comes naturally, but for
many they may not and training may be needed to improve their skills. See our factsheet
on coaching for more information.
Objectives and performance standards

Objectives (some organisations prefer to use 'goals') describe something to be
accomplished by individuals, departments and organisations over a period of time. They
can be expressed as targets to be met (such as sales) and tasks to be completed by
specified dates. They can be work-related, referring to the results to be attained, or
personal, taking the form of developmental objectives for individuals. Objectives need to
be defined and agreed. They will relate to the overall purpose of the job and define
performance areas - all the aspects of the job that contribute to achieving its overall
purpose. Targets then need to be set for each performance area, for example, increase
'sales by x per cent', 'reduce wastage by y per cent' …
Alongside objectives are performance standards. They are used when it is not possible to
set time-based targets, or when there is a continuing objective which does not change
significantly from one review period to the next and is a standing feature of the job. These
should be spelled out in quantitative terms if possible, for example, speed of response to
requests or meeting defined standards of accuracy.
Competences and competencies

Some organisations, but by no means all, use competences and competencies as
components of performance management. Competences describe what people need to
be able to do to perform a job well (the descriptions in National Vocational Qualifications
are examples of competences). Competencies (more helpfully, 'behavioural
competencies') are defined as the dimensions of behaviour that lie behind competent
performance. Though the language used does not help in making the distinction, to
perform well it is necessary both to be able to do a job at a technically competent level and
to have behaviours that reinforce those technical skills; an obvious example of behaviour
is the surgeon who needs a good bedside manner and to be able to communicate with
colleagues, in addition to surgical skills. There are various techniques for measuring
competence (some organisations prefer to use 'capability') and once an analysis has been
made, it provides a tool for measuring performance and, of course, for providing
development activities to help people meet the required standards. For more information,
see our competencies factsheet.

What to measure
To improve performance, you need to know what current performance is. Measurement
provides the basis for providing and generating feedback, and thus can build the platform
for further success or identify where things are going less well so that corrective action can
be taken. But what gets measured? Measure the wrong things, perhaps simply because
they are easy to measure, and an entire performance management system can fall into
disrepute. Use too many measures and you can't see the wood for the trees. For
measuring performance, the achievement of objectives, levels of competency, standards
of performance, and work outputs are used but the emphasis varies according to
categories of staff - for example, a senior manager would be mainly measured by meeting
objectives, but a production worker mainly by achieving outputs. Increasingly
organisations are using more sophisticated measuring techniques such as balanced
scorecards or ROI (return on investment).
Individual and team performance needs to be capable of being linked in an

understandable manner to organisational performance, and there are various approaches
to this. They include the 'balanced scorecard', a set of measures that looks at the business
from customer, internal, learning and financial perspectives; the European Foundation for
Quality Management, which indicates that customer satisfaction, employee satisfaction,
and impact on society are achieved through leadership; and other economic measures,
including traditional financial measures. Measures used will depend on the organisation;
for example, public service organisations are likely to use different measures from private
companies.
What is a target
A target is a commitment to achieve a specific quality, or level of service. Setting them

enables service delivery to be focused and measured, leading to continuous
improvement. The commitment to apply a target sends a clear message of where an
organisation is focusing its resources and where it intends to improve its performance. The
development and monitoring of targets is an integral part of planning for the future.
Targets can be both long and short term. Long-term targets are specific statements of
where an organisation wants to be in, say, ten to 20 years time. Short-term targets, or mile
stone targets, underpin these and represent the steps an organisation may take to
achieve the long-term targets. A target is a threshold which identifies the scale of change
to be derived from policies over a specific time period.
SMART targets
Targets must be realistic and achievable within the time period specified. To this end,
organisations should adopt the ‘SMART’ approach of Specific, Measurable, Achievable,
Realistic and Time-bound targets wherever practicable.
Targets focus attention on the kind of service that is needed, making it clear to staff,
stakeholders and the public what level of service, and what actions are expected.

They can help:
 front line managers focus effort and resources on priorities
 organisations to develop a culture of continuous improvement
 put national performance standards into a local context
 the public and service users to see whether services are being delivered
efficiently and effectively and to hold the authority to account for performance
 organisations to know when and how to adjust services and resources according
to policy priorities
 provide a route for involving the public in planning services
Target setting should not be viewed as a statistical or administrative process carried out by
bureaucratic number crunching organisations. It is a key plan making tool, which should
be used by everyone responsible for developing and implementing policy. Targets help to
clearly focus on what is important
However, the number of targets set is also important. Setting targets just to tick boxes can
be counter-productive and lead to ‘target fatigue’. Too few can mean that attention is too
focussed on a few targets at the expense of other areas of work. Getting the balance right
so that the correct numbers of targets are set which reflect the priorities of the services
involved needs to be managed carefully.
The priorities of an organisation should be clearly set out in its strategic plan through its
vision statement (Bowman 2006), aims and objectives. However effective these are at
communicating the strategic agenda of an organisation, it is without doubt that the focus of
the plan is communicated through its policies. These policies should be written as specific
and measurable actions with clear links to a specified target. This ultimately drives budget
allocations for projects and programmes, and measures the performance of the plan on
the ground. It can be argued that the clear setting of SMART targets to reflect the
priorities of an organisation communicates clearly what an organisation’s intended short
and long-term actions will be to other organisations and stakeholders. If this is the case,
and organisations can be made aware of each other’s intended actions over the short and
long-term from a single strategic policy document, it surely enables organisations to
communicate and coordinate actions.
According to English Heritage a plan making system should, among other things, be
properly resourced, evidence based, fully integrated, clearly prioritised, adequately
monitored and regularly reviewed. The use of targets in a plan should have purpose and
strengthen the document, rather than be seen as an add-on or an obligation. Targets must
be derived from a common goal or vision (Keeney et al 1976), and measurable attributes
(targets) are attached to sub-objectives, and a specific policy instrument (action) is
proposed to meet the target (Black et al 1983). There is potential for harmonising
information collection practices and monitoring frameworks across regions and sectors.
Key policy actors need to break away from their silos to establish linkages across different
sectors, across different spatial scales, with other actors in order to enhance and develop
their monitoring capacity “social and intellectual capital” could be built up to achieve
“institutional coherence” through which shared problems about the way regional space is
organised can be collectively addressed (Baker & Wong 2005).

An initial evaluation of 109 strategic plans from the UK, Scotland and Highlands and
Islands regional level (Bowman 2006) showed that very few plans (10) made use of
SMART targets. It is clear that target use is little understood and undervalued.
To clarify the situation further a more in depth study was carried out on 26 strategic
plans from the Highlands and Islands region of Scotland. This list of plans includes
the regional economic development plan (Highland and Islands Enterprise), the River
Spey Catchment Management Plan, the Cairngorm National Park Plan (draft at the
time of evaluation), 5 council structure plans, 5 local transport strategies, 5 Area
Waste Plans, 5 Community Planning Partnership Plans, a SNH Natural Heritage
Futures document relevant to the area, one forest and woodland strategy, one
cycling strategy and one council corporate plan. The 5 council areas included in the
Highlands and Islands are Highland Council, Argyll and Bute Council, Western Isles
Council, Shetland Isles Council and Orkney isles Council.
Skills practice
Week 2 – Day 5 – 9th February 2009
Targets flow
Balanced scorecard
Governance, Risk, and Compliance or "GRC" is an increasingly recognized term that

reflects a new way in which organizations can adopt an integrated approach to these three
areas. However, this term is often positioned as a single business activity, when in fact; it
includes multiple overlapping and related activities within an organization, e.g. internal

audit, compliance programs like SOX, enterprise risk management (ERM), operational
risk, incident management, etc.
Balanced Scorecard Basics
The balanced scorecard is a strategic planning and management system that is used
extensively in business and industry, government, and non-profit organizations worldwide
to align business activities to the vision and strategy of the organization, improve internal
and external communications, and monitor organization performance against strategic
goals. It was originated by Drs. Robert Kaplan (Harvard Business School) and David
Norton as a performance measurement framework that added strategic non-financial
performance measures to traditional financial metrics to give managers and executives a
more 'balanced' view of organizational performance. While the phrase balanced
scorecard was coined in the early 1990s, the roots of the this type of approach are deep,
and include the pioneering work of General Electric on performance measurement
reporting in the 1950’s and the work of French process engineers (who created the
Tableau de Bord – literally, a "dashboard" of performance measures) in the early part of
the 20th century.
The balanced scorecard has evolved from its early use as a simple performance
measurement framework to a full strategic planning and management system. The “new”
balanced scorecard transforms an organization’s strategic plan from an attractive but
passive document into the "marching orders" for the organization on a daily basis. It
provides a framework that not only provides performance measurements, but helps
planners identify what should be done and measured. It enables executives to truly
execute their strategies.
This new approach to strategic management was first detailed in a series of articles and
books by Drs. Kaplan and Norton. Recognizing some of the weaknesses and vagueness
of previous management approaches, the balanced scorecard approach provides a clear
prescription as to what companies should measure in order to 'balance' the financial
perspective. The balanced scorecard is a management system (not only a measurement
system) that enables organizations to clarify their vision and strategy and translate them
into action. It provides feedback around both the internal business processes and external
outcomes in order to continuously improve strategic performance and results. When fully
deployed, the balanced scorecard transforms strategic planning from an academic
exercise into the nerve centre of an enterprise.
Kaplan and Norton describe the innovation of the balanced scorecard as follows:
"The balanced scorecard retains traditional financial measures. But financial measures tell
the story of past events, an adequate story for industrial age companies for which
investments in long-term capabilities and customer relationships were not critical for
success. These financial measures are inadequate, however, for guiding and evaluating
the journey that information age companies must make to create future value through
investment in customers, suppliers, employees, processes, technology, and innovation."

Adapted from The Balanced Scorecard by Kaplan & Norton
Perspectives
The balanced scorecard suggests that we view the organization from four perspectives,
and to develop metrics, collect data and analyze it relative to each of these perspectives:
The Learning & Growth Perspective
This perspective includes employee training and corporate cultural attitudes related to both
individual and corporate self-improvement. In a knowledge-worker organization, people --
the only repository of knowledge -- are the main resource. In the current climate of rapid
technological change, it is becoming necessary for knowledge workers to be in a
continuous learning mode. Metrics can be put into place to guide managers in focusing
training funds where they can help the most. In any case, learning and growth constitute
the essential foundation for success of any knowledge-worker organization.
Kaplan and Norton emphasize that 'learning' is more than 'training'; it also includes things
like mentors and tutors within the organization, as well as that ease of communication
among workers that allows them to readily get help on a problem when it is needed. It also
includes technological tools; what the Baldrige criteria call "high performance work
systems."
The Business Process Perspective
This perspective refers to internal business processes. Metrics based on this perspective
allow the managers to know how well their business is running, and whether its products
and services conform to customer requirements (the mission). These metrics have to be
carefully designed by those who know these processes most intimately; with our unique
missions these are not something that can be developed by outside consultants.

The Customer Perspective
Recent management philosophy has shown an increasing realization of the importance of

customer focus and customer satisfaction in any business. These are leading indicators: if
customers are not satisfied, they will eventually find other suppliers that will meet their
needs. Poor performance from this perspective is thus a leading indicator of future decline,
even though the current financial picture may look good.
In developing metrics for satisfaction, customers should be analyzed in terms of kinds of

customers and the kinds of processes for which we are providing a product or service to
those customer groups.
The Financial Perspective
Kaplan and Norton do not disregard the traditional need for financial data. Timely and
accurate funding data will always be a priority, and managers will do whatever necessary
to provide it. In fact, often there is more than enough handling and processing of financial
data. With the implementation of a corporate database, it is hoped that more of the
processing can be centralized and automated. But the point is that the current emphasis
on financials leads to the "unbalanced" situation with regard to other perspectives. There
is perhaps a need to include additional financial-related data, such as risk assessment and
cost-benefit data, in this category.
Strategy Mapping
Strategy maps are communication tools used to tell a story of how value is created for the
organization. They show a logical, step-by-step connection between strategic objectives
(shown as ovals on the map) in the form of a cause-and-effect chain. Generally speaking,
improving performance in the objectives found in the Learning & Growth perspective (the
bottom row) enables the organization to improve its Internal Process perspective
Objectives (the next row up), which in turn enables the organization to create desirable
results in the Customer and Financial perspectives (the top two rows).
Balanced Scorecard Software
The balanced scorecard is not a piece of software. Unfortunately, many people believe
that implementing software amounts to implementing a balanced scorecard. Once a
scorecard has been developed and implemented, however, performance management
software can be used to get the right performance information to the right people at the
right time. Automation adds structure and discipline to implementing the Balanced
Scorecard system, helps transform disparate corporate data into information and
knowledge, and helps communicate performance information

A Balanced Scorecard approach generally has four perspectives:
1. Financial
2. Internal business processes
3. Learning & Growth (human focus, or learning and development)
4. Customer
Each of the four perspectives is inter-dependent - improvement in just one area is not necessarily a
recipe for success in the other areas.

Balanced scorecard – factors examples
Department Areas
Finance Return On Investment

Cash Flow
Return on Capital Employed
Financial Results
(Quarterly/Yearly)
Internal Business Number of activities per function

Processes Duplicate activities across
functions
Process alignment (is the right
process in the right
department?)
Process bottlenecks
Process automation
Learning & Growth Is there the correct level of

expertise for the job?
Employee turnover
Job satisfaction
Training/Learning opportunities
Customer Delivery performance to

customer
Quality performance for
customer
Customer satisfaction rate
Customer percentage of market
Customer retention rate

Once an organization has analysed the specific and quantifiable results of the above, they should be ready to
utilise the Balanced Scorecard approach to improve the areas where they are deficient.
The metrics set up also must be SMART (commonly, Specific, Measurable, Achievable, Realistic and Timely) - you
cannot improve on what you can't measure! Metrics must also be aligned with the company's strategic plan.

Success factors
What are critical success factors

Critical Success Factors (CSF’s) are the critical factors or activities required for ensuring
the success your business/operating unit. The term was initially used in the world of data
analysis, and business analysis. Most smaller and more pragmatic
businesses/organisations can still use CSF’s but we need to take a different, more
pragmatic approach.
Critical Success Factors have been used significantly to present or identify a few key
factors that organizations should focus on to be successful.
As a definition, critical success factors refer to "the limited number of areas in which
satisfactory results will ensure successful competitive performance for the individual,
department, or organization”.
Identifying CSF's is important as it allows firms to focus their efforts on building their
capabilities to meet the CSF's, or even allow firms to decide if they have the capability to
build the requirements necessary to meet Critical Success Factors (CSF's).
Academic Background/ History
The idea of identifying critical success factors as a basis for determining the information needs of
managers was proposed by RH Daniel (1961 Harvard Business Review - HBR) as an interdisciplinary
approach with a potential usefulness in the practice of evaluation within library and information units but
popularized by F Rockart (1979 Harvard Business Review - HBR). In time many academics have
applied the methodology increasingly outside the educational establishment.
The idea is very simple: in any organization certain factors will be critical to the success of that
organization, in the sense that, if objectives associated with the factors are not achieved, the
organization will fail - perhaps catastrophically so.
The following as an example of generic CSF's:
* New product development,
* Good distribution, and
* Effective advertising
These factors remain relevant today for many organizations.

Types of critical success factors
There are four basic types of CSF's
They are:
1. Industry CSF's resulting from specific industry characteristics;
2. Strategy CSF's resulting from the chosen competitive strategy of the business;
3. Environmental CSF's resulting from economic or technological changes; and
4. Temporal CSF's resulting from internal organizational needs and changes.
Things that are measured get done more often than things that are not measured.
Each CSF should be measurable and associated with a target goal. You don't need exact
measures to manage. Primary measures that should be listed include critical success
levels (such as number of transactions per month) or, in cases where specific
measurements are more difficult, general goals should be specified (such as moving up in
an industry customer service survey).
Five key sources of Critical Success Factors

MAIN ASPECTS OF Critical Success Factors
CSF's are tailored to a firm's or manager's particular situation as different situations (e.g.
industry, division, individual) lead to different critical success factors. Rockart and
Bullen presented five key sources of CSF's:
1. The industry,
2. Competitive strategy and industry position,
3. Environmental factors,
4. Temporal factors, and
5. Managerial position (if considered from an individual's point of view). Each of
these factors is explained in greater detail below.

The Industry Industry: There are some CSF's common to all companies
operating within the same industry. Different industries will have
Critical success unique, industry-specific CSF's
factor
An industry's set of characteristics define its own CSF's Different
industries will thus have different CSF's, for example research
into the CSF's for the Call centre, manufacturing, retail, business
services, health care and education sectors showed each to be
different after starting with a hypothesis of all sectors having their
CSF's as market orientation, learning orientation, entrepreneurial
management style and organizational flexibility.

In reality each organization has its own unique goals so while thee
may be some industry standard - not all firms in one industry will
have identical CSF's.
Some trade associations offer benchmarking across possible
common CSF's.
Competitive Competitive position or strategy: The nature of position in the

strategy and marketplace or the adopted strategy to gain market share gives
industry position rise to CSF's Differing strategies and positions have different
Critical success CSF's
factor
Not all firms in an industry will have the same CSF's in a
particular industry. A firm's current position in the industry
(where it is relative to other competitors in the industry and also
the market leader), its strategy, and its resources and capabilities
will define its CSF's
The values of an organization, its target market etc will all impact
the CSF's that are appropriate for it at a given point in time.
Environmental Environmental changes: Economic, regulatory, political, and

Factors demographic changes create CSF's for an organization.
Critical success These relate to environmental factors that are not in the control of
factor the organization but which an organization must consider in
developing CSF's Examples for these are the industry regulation,
political development and economic performance of a country,
and population trends.
An example of environmental factors affecting an organization
could be a de-merger.

Temporal Factors Temporal factors: These relate to short-term situations, often

crises. These CSF's may be important, but are usually short-lived.

Temporal factors are temporary or one-off CSF's resulting from a
specific event necessitating their inclusion.
Critical success
factor Theoretically these would include a firm which "lost executives as
Critical success a result of a plane crash requiring a critical success factor of
factor rebuilding the executive group".
Critical success Practically, with the evolution and integration of markets globally,
factor one could argue that temporal factors are not temporal anymore as

they could exist regularly in organizations.
For example, a firm aggressively building its business
internationally would have a need for a core group of executives
in its new markets. Thus, it would have the CSF of "building the
executive group in a specific market" and it could have this every
year for different markets.
Managerial Managerial role: An individual role may generate CSF's as

Position performance in a specific manager's area of responsibility may be
deemed critical to the success of an organization.
Critical success
factor Managerial position. This is important if CSF's are considered
Critical success from an individual's point of view.
factor
For example, manufacturing managers who would typically have
the following CSF's: product quality, inventory control and cash
control.
In organizations with departments focused on customer
relationships, a CSF for managers in these departments may be
customer relationship management.
How to write a good Critical Success Factor - CSF's
In an attempt to write good CSF's, a number of principles could help to guide writers.
These principles are:
* Ensure a good understanding of the environment, the industry and the company – It
has been shown that CSF's have five primary sources, and it is important to have a good
understanding of the environment, the industry and the company in order to be able to
write them well. These factors are customized for companies and individuals and the
customization results from the uniqueness of the organization.
* Build knowledge of competitors in the industry – While this principle can be

encompassed in the previous one, it is worth highlighting separately as it is critical to have
a good understanding of competitors as well in identifying an organization's CSF's
Knowing where competitors are positioned, what their resources and capabilities are, and

what strategies they will pursue can have an impact on an organization's strategy and also
resulting CSF's
* Develop CSF's which result in observable differences – A key impetus for the
development of CSF's was the notion that factors which get measured are more likely to
be achieved versus factors which are not measured. Thus, it is important to write CSF's
which are observable or possibly measurable in certain respects such that it would be
easier to focus on these factors. These don't have to be factors that are measured
quantitatively as this would mimic key performance indicators; however, writing CSF's in
observable terms would be helpful.
* Develop CSF's that have a large impact on an organization's performance – By

definition, CSF's are the "most critical" factors for organizations or individuals. However,
due care should be exercised in identifying them due to the largely qualitative approach to
identification, leaving many possible options for the factors and potentially results in
discussions and debate. In order to truly have the impact as envisioned when CSF's were
developed, it is important to thus identify the actual CSF's, i.e. the ones which would have
the largest impact on an organization's (or individual's) performance.
Finding information for writing Critical Success Factors (CSF's)
For the organization following the CSF method, the foundation for writing good CSF's is
a good understanding of the environment, the industry and the organization In order to do
so, this requires the use of information that is readily available in the public domain.
Externally, industry information can be sourced from industry associations, news articles,
trade associations, prospectuses of competitors, and equity/analyst reports to name some
sources. These would all be helpful in building knowledge of the environment, the industry
and competitors. Internally, there should be enough sources available to management
from which to build on their knowledge of the organization. In most cases, these won't
even have to be anything published as managers are expected to have a good
understanding of their organization Together, the external and internal information already
provides the basis from which discussion on CSF's could begin.
The information mentioned above can largely be accessed through the internet. Other
sources which would be helpful, and not necessarily accessible through the internet, are
interviews with buyers and suppliers, industry experts and independent observers.

CSF as an activity statement:
A “good” CSF begins with an action verb and clearly and concisely conveys what is
important and should be attended to. Verbs that characterize actions: attract, perform,
expand, monitor, manage, deploy, etc. (“poor CSFs” start with: enhance, correct, up-
grade”)
Examples: “monitor customer needs and future trends”
CSF as a requirement:
After having developed a hierarchy of goals and their success factors, further analysis will
lead to concrete requirements at the lowest level of detail
CSF as a key influence factor:
Some CSFs might influence other CSFs or factors such as markets, technologies, etc.
Such CSFs could be rephrased into “key influence factors” For example: “physical size” or
“trained staff”
Key Performance Indicators (KPI's) V Critical Success factors

A critical success factor is not a key Performance Indicator (KPI). Critical success factors
are elements that are vital for a strategy to be successful. KPI's are measures that quantify
objectives and enable the measurement of strategic performance.
For example:
* KPI = number of new customers/ response time
* CSF = installation of a call centre for providing quotations
Examples of Critical Success factors

Statistical research into CSF’s on organizations has shown there to be seven key areas.
These CSF's are:
1. Training and education
2. Quality data and reporting
3. Management commitment, customer satisfaction
4. Staff Orientation
5. Role of the quality department
6. Communication to improve quality, and
7. Continuous improvement

These were identified when Total Quality was at its peak, so as you can see have a bias
towards quality matters. You may or may not feel that these are right or indeed critical for
your organization.
The Critical Success Factors we have identified and use are captured in the mnemonic
PRIMO-F
1. People - availability, skills and attitude
2. Resources - People, equipment, etc
3. Innovation - ideas and development
4. Marketing - supplier relation, customer satisfaction, etc
5. Operations - continuous improvement, quality,
6. Finance- cash flow, available investment etc
Following is a sample list of the more common success factors.
This list should serve only as a guide to get you started. Some of these factors will be
irrelevant in a particular industry or competitive situation; others may need to be added, as
appropriate.
The factors are grouped into three categories of organizational competency, you will use
your own differentiators.
Examples of Success Factors:
Understanding of Market:
* Sensitivity to changing market needs
* Understanding of how and why customers buy
* Innovative response to customer needs
* Consumer loyalty
* Linkage of technology to market demand
* Link marketing to production
* Investment in growth markets
* Knowing when to shift resources from old to new products
* Long-term view of market-development and resources
* Ability to target and reach segments of market

* Identify and exploit global market
* Product-line coverage
* Short time to market for new products
* Lack of product-line overlap
* Identification and positioning to fulfil customer needs
* Unique positioning advantage
* Strong brand image and awareness
* Understanding of competitors' capabilities and decision rules
* Sensitivity to cues for co-operation
* Prevention of price wars
* Aggressive commitment when required
* Willingness to form intercompany coalitions
* Maximizing payback from marketing response to resources
Marketing Variables:
* Distribution coverage, delivery speed, and prominence
* Co-operative trade relations
* Advertising budget and copy effectiveness
* Promotion magnitude and impact
* Sales force size and productivity
* Customer service and feedback
* High product quality
* Patent protection
* Low product cost
* Ability to deliver high value to user
* Large marketing resource budget

Decision making:
* Marketing research quality
* Information system power
* Analytic support capability
* Develop human resources
* Attract the best personnel
* Managerial ability and experience
* Quick decision and action capability
* Organizational effectiveness
* Learning systematically from past strategies
Skills practice
Class work
Case Study
You have been given a variance report for the month of Jun 10. Prepare a HAIR
report highlighting the results of your analytical review and potential issues, risks
and actions that you would like to carry out.
Discuss the issues arising from the task
Differences in control procedures in a manual and a computer

environment
 Ability to carry out 100% checks on gross profit.

 Ability to do more checking because internal audit checks can be done
faster.
 Ability to do a TB check at any time
 Ability to do control account checks at any time
 Ability to take backups that can be stored in remote locations ( showing
last transaction number)

 Ability to prepare a Fraud dashboard
 Ability to prepare a HAIR report faster
 Look at many areas in unison ( number of journals raised, number of
credit notes raised issued, number of credit notes received) and so spot
complicated frauds easier
 Control access through access rights and the ability to see who posted
what
 Reduced staff requirement for regular duties and so making available more
staff for audit.
 Ability to do more random checks
Appendix – Definitions & Resources
Resources
ACCA - http://www.accaglobal.com/
ICAEW- http://icaew.com
AIA - www.aiaworldwide.com/
Accounting web - http://www.accountingweb.co.uk/
Sage – www.sage.co.uk
Tally - http://www.tallysolutions.com/
About.com - http://compreviews.about.com/od/storage/a/eSATA.htm

Basic Computer Skills - web sites
This page provides some useful links if you are new to computers.
www.bbc.co.uk/webwise/abbeg/abbeg
www.bbc.co.uk/webwise/course/
.shtml
This is part of the Webwise site. An online beginner's The Webwise Online Course, an updated version of
guide to those new to keyboard, mice and windows. the old Becoming Webwise package provided by the
BBC.
www.bbc.co.uk/webwise/learn/ www.bbc.co.uk/webwise/
A step-by-step online learning package created by the "The internet made simple by the BBC".
BBC. Can link in with local college courses for A basic introduction, plus articles on current issues
accredited qualifications. relating to the internet.
www.webopedia.com

Definitions Related to Computer Skills
Glossary of computer terms - http://www.sharpened.net/glossary/

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Auditing and Accounting in

ALL CONTENTS COPYRIGHT © 2004-2009 H&H ASSOCIATES 1

Introduction of computers in the department........................................10

Computer Skills Joke.........................................................................11

The impact of ICT on economic growth and trade................................11

ICT policy review framework for the information economy....................14

What computers can do for you..........................................................14

What computers can’t do for you........................................................15

Lesson 1: Entering Text and Numbers................................................17

The Microsoft Excel Window..............................................................17

The Microsoft Office Button................................................................18

The Quick Access Toolbar.................................................................18

The Title Bar......................................................................................18

The Formula Bar...............................................................................19

The Status Bar..................................................................................20

Move Around a Worksheet.................................................................20

ALL CONTENTS COPYRIGHT © 2004-2009 H&H ASSOCIATES 2

Delete a Cell Entry.............................................................................30

Lesson 2: Entering Excel Formulas and Formatting Data.....................30

Set the Enter Key Direction................................................................30

Perform Mathematical Calculations....................................................32

Perform Automatic Calculations.........................................................37

Align Cell Entries...............................................................................38

Perform Advanced Mathematical Calculations....................................40

Copy, Cut, Paste, and Cell Addressing...............................................41

Insert and Delete Columns and Rows.................................................48

Merge and Center.............................................................................53

Add Background Color.......................................................................54

Change the Font, Font Size, and Font Color.......................................55

Move to a New Worksheet.................................................................58

Bold, Italicize, and Underline..............................................................59

Work with Long Text..........................................................................62

Change A Column's Width.................................................................63

Lesson 3: Creating Excel Functions, Filling Cells, and Printing.............67

Using Reference Operators................................................................67

Fill Cells Automatically.......................................................................74

Create Headers and Footers..............................................................78

Set Print Options...............................................................................81

ALL CONTENTS COPYRIGHT © 2004-2009 H&H ASSOCIATES 3

Apply a Chart Layout.........................................................................88

Change the Style of a Chart...............................................................90

Change the Size and Position of a Chart.............................................92

Move a Chart to a Chart Sheet...........................................................92

Change the Chart Type......................................................................93

Why performance management is important.......................................95

The Importance of Performance Management....................................96

What you will gain from Performance Management.............................98

The individual benefits from using Performance Management.............99

Tools of performance management....................................................99

Targets flow........................................................................................... 104

Balanced scorecard – factors examples............................................108

Case Study............................................................................................ 117

Differences in control procedures in a manual and a computer environment117

Appendix – Definitions & Resources.......................................................118

ALL CONTENTS COPYRIGHT © 2004-2009 H&H ASSOCIATES 4

ALL CONTENTS COPYRIGHT © 2004-2009 H&H ASSOCIATES 5

THE BENEFITS OF USING A COMPUTER AT WORK

ALL CONTENTS COPYRIGHT © 2004-2009 H&H ASSOCIATES

Introduction of computers in the department

How computers can help you at work

Computer Skills Joke

ALL CONTENTS COPYRIGHT © 2004-2010 H&H ASSOCIATES 10