A Typical Model Audit Approach: Spreadsheet Audit Methodologies in the City of London

Spreadsheet audit and review procedures are an essential part of almost all City of London financial transactions. Structured processes are used to discover errors in large financial spreadsheets underpinning major transactions of all types. Serious errors are routinely found and are fed back to model development teams generally under conditions of extreme time urgency. Corrected models form the essence of the completed transaction and firms undertaking model audit and review expose themselves to significant financial liability in the event of any remaining significant error. It is noteworthy that in the United Kingdom, the management of spreadsheet error is almost unheard of outside of the City of London despite the commercial ubiquity of the spreadsheet.