Why Top Consulting Firms Are Using This Excel AI — Transcript

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1. 0:00What happens when someone gives you a
2. 0:0112-month general ledger in a PDF and
3. 0:04says, "Can you turn this into a
4. 0:05financial model with a 6-month
5. 0:07forecast?" Normally, that means hours of
6. 0:10extracting data, checking transactions,
7. 0:13mapping accounts, and trying to balance
8. 0:15the statements. But what if AI could
9. 0:17take that source document and build the
10. 0:19P&L and the balance sheet, link formulas
11. 0:23back to the underlying transactions, and
12. 0:25show you exactly where every number came
13. 0:27from? And then, turn the finished model
14. 0:29into an interactive forecast app where
15. 0:32stakeholders can adjust assumptions and
16. 0:34immediately see the impact. That's what
17. 0:36I'm testing today with Tracelight.
18. 0:38Tracelight is sponsoring this video, but
19. 0:40I'll be putting it through a practical
20. 0:42financial modeling workflow to see how
21. 0:44far it can really take us. If you'd like
22. 0:46to follow along, there's a code and
23. 0:48links in the description so you can try
24. 0:49Tracelight for free and download the
25. 0:52example file.
26. 0:53The starting point is this general
27. 0:55ledger exported as a PDF. It contains 12
28. 0:58months of transactions from July 2025
29. 1:01through to June 2026 with account codes,
30. 1:04descriptions, debits and credits
31. 1:06spanning 11 pages.
32. 1:09The first challenge is extracting the
33. 1:11data from the PDF, but we also need to
34. 1:13turn it into a model that remains useful
35. 1:15as new transactions are added with
36. 1:17formulas that can be traced back to the
37. 1:19source data. Let's put Tracelight to the
38. 1:21test. You'll find Tracelight in the
39. 1:24Excel add-ins library, and once
40. 1:26installed and signed in, it opens in a
41. 1:28task pane on the right. All right, I can
42. 1:30drag in my PDF and ask it to import the
43. 1:34attached general ledger PDF and convert
44. 1:36it to a clean structured table, preserve
45. 1:38all columns. Where journal identifiers
46. 1:40are available, check that each journal
47. 1:42balances and flag any extraction
48. 1:44ambiguity rather than guessing. Let's
49. 1:46click send and see how it goes. Okay,
50. 1:49it's imported all the data, keeping the
51. 1:51date integrity by using the date
52. 1:53function, so it will properly sort and
53. 1:55filter. The account code is entered as
54. 1:58text so that any leading zeros are
55. 2:00preserved. And if we control shift to
56. 2:03the right, you can see it's also checked
57. 2:05that the debits and credits balance,
58. 2:07which is exactly the kind of control you
59. 2:09want built into a financial modeling
60. 2:11workflow. And that's where Tracelight
61. 2:13feels different from a general purpose
62. 2:14AI tool. It's been built specifically
63. 2:17around the kinds of checks and modeling
64. 2:18tasks finance professionals and
65. 2:20consultants need to perform. Now, you
66. 2:22may have noticed that each cell also has
67. 2:25the purple flag, which documents the
68. 2:27source, making the imported data easier
69. 2:29to trace. And what I really love is the
70. 2:31ability to click on view source and open
71. 2:34the PDF and see the cell that I've
72. 2:36selected highlighted in the PDF in real
73. 2:38time.
74. 2:40Now that we're happy with the data, I'll
75. 2:41start a new chat and ask it to use the
76. 2:44clean general ledger to build a monthly
77. 2:46profit and loss statement and balance
78. 2:48sheet for the year ended 30 June 2026.
79. 2:51Create an account mapping table,
80. 2:53reconcile all outputs to the ledger, and
81. 2:56create a one-page management dashboard
82. 2:58with revenue, gross profit, operating
83. 3:00profit, cash receivables, inventory,
84. 3:03payables, debt, and monthly trends. Use
85. 3:05formulas, structured references, and
86. 3:07dynamic ranges wherever appropriate. Do
87. 3:10not hardcode financial statement values.
88. 3:12The reports must update automatically
89. 3:15when new general ledger rows are
90. 3:16appended to the cleaned ledger table.
91. 3:18Let's send that and see how it goes.
92. 3:21While we wait for Tracelight to process
93. 3:22that prompt, it's a good time to mention
94. 3:24the user instructions feature, which is
95. 3:26useful for longer prompts that you might
96. 3:28use repeatedly. Clicking on this icon,
97. 3:31we can go into manage instructions,
98. 3:33which lets you save your prompts as
99. 3:35skills or workflows.
100. 3:37Then you can run the same process again
101. 3:39by typing the forward slash and
102. 3:41selecting it from the list without
103. 3:42rewriting the instructions each time.
104. 3:45Okay, Tracelight has inserted four new
105. 3:47sheets, starting with the mapping table
106. 3:49for the accounts that classifies them
107. 3:50into balance sheet or profit and loss.
108. 3:53Then it classified them into categories
109. 3:55and subcategories. Now obviously you'd
110. 3:57review the mapping to ensure it aligns
111. 3:59with your business reporting rules.
112. 4:01Okay, let's look at the P&L. First
113. 4:03impressions are great. It's nicely
114. 4:05formatted making it easy to read and
115. 4:08there's a reconciliation check at the
116. 4:09bottom. It's used some IFS formulas
117. 4:12linked to the general ledger and the
118. 4:13month headers. So new transactions are
119. 4:15going to flow into the existing
120. 4:16reporting periods and the model can be
121. 4:18extended easily as new months are added.
122. 4:21It's also added gross margin, EBITDA
123. 4:24margin, and net margin, which are useful
124. 4:26additions that show Tracelight
125. 4:28understands the financial context, not
126. 4:30just the data.
127. 4:32Next, the balance sheet. It follows the
128. 4:34same link structure with the formulas
129. 4:36pulling from the ledger and a
130. 4:38reconciliation check confirming the
131. 4:40model or balances.
132. 4:42The dashboard has the key metrics I
133. 4:43asked for at the top including debt
134. 4:46ratios and more. Then we have the
135. 4:48monthly trend data
136. 4:50and the charts below. The dashboard
137. 4:52gives us a useful management view
138. 4:54straight away and a solid base for
139. 4:56forecasting, but when AI has built the
140. 4:58model, you still need to be able to
141. 5:00understand and verify the logic behind
142. 5:02the numbers.
143. 5:03Let's take one of the cells and use
144. 5:05Tracelight's trace feature to see
145. 5:07exactly how it's been calculated. With
146. 5:09the cell selected, go to the trace tab
147. 5:12and then click trace C13. It shows the
148. 5:15formula like you'd see in the formula
149. 5:17bar and at the bottom I've got a plain
150. 5:19English explanation of what the formula
151. 5:21is calculating. You can click on values
152. 5:24to see how the components evaluate
153. 5:26and label shows you how Tracelight has
154. 5:28interpreted the meaning of each
155. 5:30reference from the surrounding row and
156. 5:32column labels. Use your arrow keys to
157. 5:34navigate through the formula arguments
158. 5:37and press enter to drill down into a
159. 5:39reference. And this ability to instantly
160. 5:41navigate to the precedents while also
161. 5:44inspecting the formula is super handy
162. 5:46for auditing.
163. 5:47Okay, so far Tracelight has taken a PDF
164. 5:50general ledger and turned it into linked
165. 5:52financial statements and a dashboard for
166. 5:54understanding what's already happened.
167. 5:56But, you know the next task your boss is
168. 5:58going to request is a forecast.
169. 6:01I'll start a new chat
170. 6:02and ask Tracelight to convert the
171. 6:04management dashboard into an interactive
172. 6:06spreadsheet app with a monthly forecast
173. 6:09from July to December 2026.
174. 6:11Use the latest actual monthly results as
175. 6:14the forecast baseline, add editable
176. 6:16assumptions for revenue growth, gross
177. 6:18margin, payroll growth, operating
178. 6:20expense growth, inventory purchasing,
179. 6:23debtor days, creditor days, capital
180. 6:25expenditure, and loan repayments.
181. 6:27Allow users to adjust these assumptions
182. 6:29and see the forecast P&L, cash balance,
183. 6:32working capital, and key dashboard
184. 6:33charts update instantly. Clearly
185. 6:36separate actuals from forecast, show the
186. 6:38assumptions panel prominently, and
187. 6:40include a base case scenario by default.
188. 6:43Let's send that and see how it goes.
189. 6:46Tracelight's [snorts] inserted a new
190. 6:47sheet for the forecast with formulas
191. 6:49that extrapolate 6 months into the
192. 6:51future and adjustable assumptions I can
193. 6:54tweak to run various scenarios. Plus, in
194. 6:56the task pane we can see a preview of
195. 6:58the interactive dashboard it's built. We
196. 7:00can expand it here or open it in the
197. 7:02browser. Let's do that.
198. 7:04First impressions are excellent. It's
199. 7:07nicely laid out and formatted. We've got
200. 7:09key headline figures at the top, and on
201. 7:12the left I can use the sliders to adjust
202. 7:14the assumptions and the dashboard
203. 7:16dynamically updates. Hovering over
204. 7:18points in the chart brings up the
205. 7:20tooltips, and I can click the legend
206. 7:22items to temporarily remove them.
207. 7:24Now, the spreadsheet app calculations
208. 7:26run in the browser, so changes you make
209. 7:28here aren't written back to the original
210. 7:30Excel file. And rather than emailing a
211. 7:32full Excel workbook around, I can share
212. 7:35the link to the interactive app with
213. 7:36stakeholders.
214. 7:38That takes care of the planning side
215. 7:39with a model that people can interact
216. 7:41with without changing the underlying
217. 7:43formulas.
218. 7:44But, building a model is only part of
219. 7:46the job. You also need to be able to
220. 7:48check what changed between versions and
221. 7:50spot issues before they become problems.
222. 7:52So, next I want to look at two more
223. 7:54practical features, comparing workbooks
224. 7:57to identify differences and the audit
225. 7:59tool for checking the integrity of the
226. 8:01model. Let's [snorts] start with
227. 8:02auditing. I've made a few sneaky changes
228. 8:05to the model in this workbook now, so
229. 8:06let's test it out. Go to the audit tab
230. 8:09and click run the error check.
231. 8:12You can specify which sheets to check
232. 8:14and give it some instructions. Let's go
233. 8:16ahead and run the error check.
234. 8:19Tracelight [snorts] has found three high
235. 8:21severity errors, which it has documented
236. 8:24in the task list below. Clicking on the
237. 8:26green links takes you to the problem
238. 8:27cell and we can see here the formula has
239. 8:29been multiplied by 1.05,
240. 8:32which results in an imbalance of 3775.
241. 8:35And I can click here to fix it or I can
242. 8:37continue to review the other errors and
243. 8:40then get Tracelight to fix them all.
244. 8:42Once I'm done there, click the back
245. 8:43button. And here you'll find the compare
246. 8:46tool. Click on that
247. 8:48and it opens Tracelight in the online
248. 8:50app, where you can import two Excel
249. 8:51workbooks and have it find the
250. 8:53differences. I'll upload my files and
251. 8:56click find differences. And let's see if
252. 8:59Tracelight finds any.
253. 9:01In almost [snorts] no time, Tracelight
254. 9:02gives me a summary of the changes. The
255. 9:05green items are all clickable, quickly
256. 9:07navigating you to the relevant cell or
257. 9:09range. If we look at the sheet tabs at
258. 9:11the bottom, you can see they're
259. 9:13annotated and the cells with differences
260. 9:15are color-coded. Clicking on the cell
261. 9:17gives you the before value in red and
262. 9:20that after value in green, so you have
263. 9:21all the information to hand.
264. 9:23And if we go to the forecast sheet and
265. 9:25switch on computed changes, you can see
266. 9:27the cells that are impacted by the
267. 9:29upstream changes. This makes it much
268. 9:31quicker to identify what changed,
269. 9:33understand the impact and decide what
270. 9:35needs attention. What I really liked is
271. 9:38Tracelight is not just giving you an
272. 9:39answer and expecting you to trust it. It
273. 9:42creates a working file that's designed
274. 9:44to be traceable and auditable, where you
275. 9:46can inspect the formulas, check
276. 9:49underlying transactions, and see how the
277. 9:50model has been built. And that makes it
278. 9:52particularly useful for finance
279. 9:54professionals and consultants who spend
280. 9:56a lot of time building and reviewing
281. 9:58Excel models. Tracelight is live with
282. 10:00seven of the 10 largest management
283. 10:02consulting firms, as well as PE funds
284. 10:04and asset managers with more than 600
285. 10:07billion in AUM. There's a code in the
286. 10:10description if you'd like to try
287. 10:11Tracelight for free at tracelight.ai.
288. 10:14Thanks for watching. I'll see you in the
289. 10:16next one.