Another example is an IT manager who wants to budget for multiple projects, each of which will incur consulting, hardware, and software expenses, or a marketing manager who wants to budget by marketing campaign. These are the tip of the iceberg. There are as many examples of differences between how budget managers and accountants think as there are people frustrated by the corporate budgeting process. Yet in most cases, the managers have to create their "real budget" offline and then map it to the corporate budget template.

Do most line managers have the Excel skills necessary to create a budget in their own terms and then map it to finance's budget template? According to our survey, the answer is no. The survey pinpointed four everyday tasks in Excel that a manager should be able to do in order to put together an accurate and meaningful budget. Then we asked respondents what proportion of line managers within their organization can perform those tasks without creating an error. The tasks: creating a formula that references an absolute column but a relative row, linking a formula in one spreadsheet to a number in another spreadsheet in the same workbook, inserting a subtotal and properly adjusting the grand total formula, and copying and pasting a value instead of a formula. The finance managers who responded to our survey were not optimistic about their line managers' Excel skills (see exhibit 2).

Here's one simple example of the spreadsheet savvy that someone might need in order to put together a budget from the ground up: Suppose an HR manager wants to budget for five training and development programs over the course of a year. Each program will incur some outside professional fees, some facilities charges, and some other meeting expenses. Each of these expenses is represented by an account within the budget, but since the budget input form has just one line for each account, my HR manager will need to take the following actions before entering his budget numbers. He'll start by opening a new spreadsheet in the budget workbook. He'll type in a name for each of the five training programs. He'll enter, under each training program heading, the name of every account for which the program will have a budgeted expense, along with the budgeted amount. He'll create a subtotal for each training program. Then, to create a grand total for the budget line item Outside Professional Fees, he'll write a formula that looks something like:

=C7+C15+C23+C31+C39

This is a very simple exercise, but only 18 percent of the finance professionals we surveyed think the majority of nonfinance managers in their company could perform it without making a mistake.

If my HR manager totals his consulting costs without making a mistake, he'll need to create grand totals for the remaining two accounts. The easiest way to do that will be to use the "fill, down" command on Excel's "edit" menu -- but how many HR managers do you know who can use the "edit, fill, down" procedure? Assuming my HR manager is well-versed in Excel and correctly totals all three accounts without an error, he will then need to click on the cell that contains the grand total for the Outside Professional Fees account, select "copy" from the "edit" menu, navigate to the cell in the original budget that contains the Outside Professional Fees expense line, and select "paste, special." There are multiple radio buttons on the submenu that pops up; near the bottom is a button marked "paste link." When my HR manager clicks that button, he will have successfully completed one portion of his budget.

Simple summing of disparate numbers in Excel and linking from one spreadsheet to another are second nature for most finance people, but many nonfinance managers struggle with this type of task. Just 17 percent of the people we surveyed think that most nonfinance managers in their company can link a formula in one spreadsheet to a number in another spreadsheet in the same workbook without creating an error or omission.

The most popular solution that finance managers devise to overcome line managers' lack of Excel competence is to lock down the input form. They allow budget managers to enter their account data only in specific fields, and they write calculations into the spreadsheet as unalterable formulas. This approach does prevent certain types of mechanical errors in the final budget, but it may introduce other errors by forcing managers to work outside the system to develop their budgets. Locking down the input form doesn't make the complex process of coming up with the budget numbers for each account any easier. Is it surprising, then, that 40 percent of budgets still contain errors or omissions?