Spreadsheets: A Shackle to the Appraisal Profession?
Excerpts: How can spreadsheet software hinder the profession? A Wall Street Journal article, and a presentation at the Appraisal Institute National Conference have similar stories. One addresses accountants, the other is about appraisers.
The 2015 AI meetings presentation: Will Appraisers Have to Learn to Use Real Analytics Software? was given by George Dell. The main point was that accountant’s software was primarily developed for record-keeping, mimicking paper columns and rows, with analysis a later goal. Other points are:
- Validating and tracking data is difficult.
- No built-in audit trails, nor tracking of changes.
- Regulatory compliance is difficult to accomplish.
- Susceptible to trivial human errors ETC.
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My comment: Read this article. I totally agree. I started using spreadsheets in 1981 for financial analysis. When I started my appraisal business in 1986, commercial appraisers were using spreadsheets for Discounted Cash Flow. I knew the many problems with spreadsheets’ reliability.
They are particularly unsuitable for statistics as they are not statistics programs. In my MBA program in 1979, I used SPSS for multiple regression analysis, connecting to a large computer.