Version 1 - Louisiana Presentation.pdf · Version 1.0. Internal Orders. FI-CO-002 August 19, 2008...

Version 1.0

Internal OrdersFI-CO-002

August 19, 2008

Internal OrdersInternal OrdersFIFI--COCO--002002

August 19, 2008August 19, 2008

LaGOVLaGOV

2

Agenda

Logistics, Ground Rules & Introduction

Project Timeline

Workshop Objectives

Business Process Review– Process overview– AS-IS process flow– Current system alignment– Process improvement opportunities– SAP terms glossary– SAP concepts & functionality – Business process flow– Leading practices– Enterprise readiness challenges

Next Steps – Action items

Questions

3

Before we get started ...

Logistics

4

Ground Rules

Has everybody signed in?

Everybody participates – blueprint is not a spectator sport

Silence means agreement

Focus is key – please turn off cell phones and close laptops

Challenge existing processes and mindsets

Offer suggestions and ideas

Think Enterprise

Ask questions at any time

One person at a time please

Timeliness – returning from break

Creativity, cooperation, and compromise

5

Introduction

Roles

Process Analyst and Functional Consultant – lead and facilitate the discussions and drive design decisions

Documenter – take detailed notes to support the formal meeting minutes to be sent by the Process Analyst to all participants for review and feedback

Team Members – provide additional support for process discussions, address key integration touch points

Subject Matter Experts – advise team members on the detailed business process and participate in the decisions required to design the future state business process

Round the Room IntroductionsName

PositionAgency

6

Project Phases

Five Key Phases

• Strategy & Approach Defined• Project Team Training

• Business Process Definition• Development Requirements

• Development & Unit Testing• Integration Testing• End-User Training Materials

• User Acceptance• Technical Testing• End-User Training• Conversion

• Go-Live Support• Performance Tuning

Proj

ect

Prep

arat

ion

Bus

ines

s B

luep

rint

Rea

lizat

ion

Go

Live

an

d Su

ppor

t

Fina

l Pr

epar

atio

n

7

Functionality Tentative Implementation Date

Budget Prep October 2009

DOTD February 2010

Core Modules All Agencies July 2010

Additional Modules January 2011

Tentative Project Timeline

Tentative implementation dates are planned as follows:

Project Start-Up

May – June 2008 July 2008 August – Dec 2008 January 2009

Blueprint

Phased deployment will be

confirmed/updated before completion

of Blueprint activities!

8

Finance LeadsBeverly Hodges – Finance LeadDrew Thigpen – Finance LeadMary Ramsrud – Consulting Lead

Logistics LeadsBelinda Rogers – Logistics LeadJack Ladhur – Logistics LeadBrad Denham – Consulting Lead

Linear Assets LeadsMark Suarez – Agile Assets LeadCharles Pilson – Consulting Lead

General Ledger

Accts Receivable

Cost Accounting

Grants Mgt

Asset Accounting

Real Estate Management

Linn McNaryPatrick JohnsonAbdulla Meer

Accounts Payable

Cash Management

Funds Management

Project Systems

Budget Prep

Project Organization - Functional Teams

Grantor

9

Blueprint Objectives

Review and discuss the current or As-Is business processes• Which helps to drive out the Business requirementsBusiness requirements• As well as the integration pointsintegration points with other processes

Define Master Data• Address key integration points• Support organizational requirements• Consistent and appropriate use of data fields

Define Future or To-Be business processes based on:• Best Practices inherent in SAP• Intellectual capital from other SAP implementations• State business requirements

Identify development requirements • Which could result in the need for a form, report, interface,

conversion, enhancement, or workflow (FRICE-W)

Understand and communicate any organizational impacts / Enterprise Readiness challenges

Gather system security authorizations and district-wide training requirements

10

Controlling WorkshopsSession ID Date Business Process Goals

FI-CO-001 08/05/08 Cost Centers - Intro to SAP Finance & Controlling- Intro to Cost Centers - Cost Center Numbering Schema- As-Is Processes for Cost Centers- To-Be Processes for Cost Centers: Master Data Maintenance & Settlement

FI-CO-002 08/19/08 Account Code Structure – Internal Orders

- Intro to Internal Orders: True Orders & Statistical Orders- Internal Orders Numbering Schema - As-Is Processes for Internal Orders- To-Be Processes for Internal Orders: Master Data Maintenance - Integration with FI-GL & FM

FI-CO-003 08/26/08 Time Entry Postings - Intro Time Entry Postings- Explore options for using Time Entry Postings- As-Is Processes for Time Entry Postings - To-Be Processes for Time Entry Postings

FI-CO-004 09/17/08 – 09/18/08

Inter-Agency Transfers - Intro Inter-Agency Transfers- As-Is Processes for Inter-Agency Transfers - To-Be Processes for Inter-Agency Transfers- Funds Management & FI-GL Impacts

FI-CO-005 09/30/08-10/02/08

Periodic Processing/Cost Allocations

- Periodic Processing & Cost Allocations - Overview- Statistical Key Figures & Activities- As-Is Processes for Cost Allocations - To-Be Processes for Cost Allocations

FI-CO-006 10/16/08 Management Reporting - Intro to Management Reporting - Reporting Requirements- Controlling Standard Reports

FI-CO-Validation 11/17/08-11/18/08

CO Validation - Review CO Blueprint Design & Documentation- Validate CO Blueprint Design & Documentation

11

Work Session Objectives

Session Topics:

Discuss Purpose of Finance (FI), Funds Management (FM) and Controlling (CO)

Review Last Session on: Cost Centers

Introduce CO Master Data: Cost Elements

Introduce CO Master Data: Internal Orders & Internal Order Types?

“As-Is”: What Legacy AFS and DOTD Finance account code objects map to SAP Internal Orders?

“As is”: Current Processes Related to Internal Orders

Numbering Scheme for Internal Orders

“To Be”: Future Processes for Internal Orders Master Data Maintenance

Action Items & Next Steps

12

SAP Glossary

Settlement – Process used to allocate costs collected in an Internal Order to one or more Cost Centers. CO.

Cost Center - A Cost Center is an organizational unit within a controlling area that represents a revenue and cost collector for more permanent activities or areas of responsibility. CO.

Cost Element - Cost Element is a Master Data object used in CO to classify and record costs. CO.

Internal Order - Master Data object used to collect and monitor the actual costs of discrete, short- term tasks. Costs collected in Internal Orders can be allocated to one or more Cost Centers. CO.

13

Financial Accounting

FIFI

General Ledger

Fixed Assets

Bank Accounting

Accounts Receivable

Accounts Payable

14

Funds Management

FMFM

Fund Accounting

Budgetary Controls

Budget Execution

Budgetary Basis Reporting

Commitment Accounting

15

COCO

Cost Center Accounting (CCA)

Cost Element Accounting (G/L Accounts P&L)

Internal Orders (IO)

Allocations, assessments, and distributions

Controlling

Financial AccountingCodes

Cost AccountingCodes

Budgetary ControlCodes

Mid-Level Accountability

High-Level Reporting

Detailed Visibility

11/12/2008

SAP Integration

FI

FM CO

17

A Cost Center is an organizational unit within a controlling area that represents a revenue and cost collector for more permanent activities or areas of responsibility.

A cost center can be linked to a company code, a business area, a functional area, a fund, and a fund center allowing all these codes to be automatically defaulted when a user enters a cost center in a document.

A standard hierarchy of cost centers is required for the controlling area and is used by drill-down reports. Each level or node of the standard hierarchy is a cost center group. In addition Cost Centers may optionally belong to additional alternative hierarchies that can also be used by drill-down reports.

Field Length: 10

Controlling (CO) Master Data

Cost Center

18

Cost Centers: State of Louisiana Proposed Numbering Convention

W-I-P

(1) (2) (3) (4) (5) (6) (7) (8) (9) (10)

(1) – (3)

Business Area =

Agency

(4) – (5)

Program

(6) – (7)

AFS Division

or

DOTD District

or Section

(8) – (10)

AFS Section

or

(8) – (10)

DOTD (see note)

Note:

Last 3 digits of the cost center number is still being finalized for DOTD.

19

Example: Dept of Justice, Office of Attorney General

Office Of Attorney GeneralAgency

(141)

Administrative Program

(1000)

Civil Program

(2000)

Admin. Services Division

(1)

Civil Division

(1)

Public Protection Division

(2)

Finance Section

(1)

Gov. Litigation Section

(1)

Tobacco Section

(1)

Property/Rec/FleetSection

(2)

Budget & Accountability

Section(3)

Public Finance & ContractSection

(2)

Equal OpportunitySection

(2)

Agency Program Division Section

Administrative Services Program

Admin. Services Division1410101001 Finance 141 01 01 0011410102002 Property/Rec/Fleet 141 01 02 0021410103003 Budget & Acct. 141 01 03 003

Civil Program

Civil Division1410201001 Gov. Litigation 141 02 01 0011410201002 Public Fin. & Contract 141 02 01 002

Public Protection Division1410201001 Tobacco 141 02 01 0011410201002 Equal Opportunity 141 02 01 002

Organizational Structure Cost Center Number

20

Controlling(CO)

Financial Accounting(FI)

Funds Management(FM)

Cost Center Funds Center Business Area

Finance Integration

21

Cost Elements are used to classify and record costs in CO.

Several Cost Elements can be grouped into a “Cost Element Group” for reporting.

Two Types of Expense Cost Elements:

Primary Cost Elements

Secondary Cost Elements


Cost Elements

22

Primary Cost Elements represent expenditure accounts in CO. They are linked to P&L type GL accounts on a one-for-one basis and have the same number and description. Primary cost elements will be set up for all P&L GL accounts.

Expense Accounts in FI-GL will correspond to Primary Cost Elements in CO

Examples:

– Assets: 100000-199999– Liabilities: 200000-299999– Fund Balance: 300000-399999– Expenses: 500000-599999


Primary Cost Elements

23

Secondary Cost Elements are used for internal allocations within a Controlling Area, such as overhead. These Cost Elements are not directly linked to a nominal GL account.

Secondary Cost Elements are exclusively used in CO for:

Assessment

Overheads

Internal Activity Allocation

Internal Order Settlement

Examples:

– Secondary Costs: 900000-999999


Secondary Cost Elements

24

Revenue Elements are used to record revenues in CO.

Revenue Accounts in FI-GL will correspond to Revenue Elements in CO.

Example:

– Revenues: 400000-499999


Revenue Elements

25

Controlling(CO)




Finance Integration

Cost Element Commitment Item G/L Account

26

CO Master Data objects used to collect and monitor the actual costs of discrete, short-term tasks. Costs collected in Internal Orders can be allocated to one or more Cost Centers.

Typically, Special projects that are short-term and/or finite in nature that are not handled by SAP’s Project System (SAP-PS) module are set up as Internal Orders.

Examples: Katrina, Rita, National Fisheries Conference

Internal Orders can also be used to monitor revenues.


Internal Order

27

Internal Orders can be linked to a company code and a business area allowing them to be automatically defaulted when a user enters an Internal Order in a document.

Internal Orders can be grouped together as “Internal Order Group”.

Internal Orders are two kinds:

True Internal Orders

Statistical Internal Orders


Internal Order (contd.)

28

FI Postings are made either to a Cost Center or a True Internal Order.

Postings made to a True Order can be “settled” to other Cost Objects, such as: one or more Cost Centers.

Example Scenario: Unexpected Special Project “Katrina” warrants spending State Resources. Funding situation for Katrina is available but it not clearly defined by Cost Center. State Administrators decide to mobilize resources.

Katrina is set up as a True Internal Order. When expense postings occur, they are charged to “Internal Order Katrina”.

When funding situation is clear (or periodically), costs are allocated to appropriate Cost Centers where funding is available.


True Orders

29

Statistical orders are secondary cost objects; any postings to a statistical order, must also be posted to a real CO object . Used by individual agencies/departments to meet their reporting and evaluation needs.

Costs collected in Statistical Orders are not settled to any other Cost object.

Example Scenario: “Cost Center” ABC has several short-term activities going on, including a “Special Project” XYZ. Funding for all activities comes from Cost Center ABC’s budget. Director of the Cost Center wants to track and report on revenues and expenses incurred towards the Special Project XYZ.

We will set up Cost Center ABC and Statistical Internal Order XYZ in SAP-CO.

When expense postings for Special Project XYZ occur, they are charged to Cost Center “ABC” and Secondary Internal Order “XYZ” simultaneously. For all other postings, only Cost Center ABC is charged.

Costs incurred for the Special Project XYZ are responsibility of the Cost Center ABC; however, Management Reports clearly identify all revenues and expenses associated with Special Project “XYZ”. No further settlement of cost expenses occurs.


Statistical Orders

30

Controlling(CO)




Finance Integration

Cost Element Commitment Item G/L Account

Internal Order FM Object

As Is – Internal Orders

Determined that in some cases, the following AFS objects may be candidates for replacement by Internal Orders (other SAP object will be used as well):

– Sub-Object & Sub-Revenue Source– Reporting Category– Activity

Definitions:

Object Usage Technical

Sub-Object & Sub- Revenue Source

•Used as a more detailed breakdown for revenue and expense•Free-form entry, No validation when referencing this field•Each agency defines this field and utilizes for its own purpose

Length: 2Format: AlphanumericApprox. #: Unknown

Reporting Category

•Collects revenue & expenditure data for a grant or special project•Set up and controlled independently by each agency •Validated by system

Length: 4Format: AlphanumericApprox. #: 43,000

Activity Code •Tracks costs of a specific activity•Defined statewide (not specific for an individual agency)•Examples – TECH, KATR, RITA

Length: 4Format: AlphanumericApprox. #: 3

Sample Usage – Sub-ObjectDEPT OF WILDLIFE AND FISHERIES:

For DWF, these Sub-Objects apply to all Objects

WB

WH

TD

TC

SF

OW

OR

OJ

NF

LC

LR

LA

LD

IS

GC

ED

BS

BC

AC

SubObject Code

White Boot Brigade

Washington Hill

Tourism Day

Tales of the Cocktails

Seafood Festival

Oyster Week

Oyster Reception

Oyster Jubilee

National Fisheries Conference (NFI)

Louisiana Seafood Cookoff

Louisiana Restaurant Expo

Louisiana Alive

Legislative Day

International Shellfish Sanitation Conference

Great American Seafood Cookoff

Education Day

Boston Seafood Show

Bonne Crevette

Alligator Cookoff

Event

WB

WH

TD

TC

SF

OW

OR

OJ

NF

LC

LR

LA

LD

IS

GC

ED

BS

BC

AC

SubObject Code

White Boot Brigade

Washington Hill

Tourism Day

Tales of the Cocktails

Seafood Festival

Oyster Week

Oyster Reception

Oyster Jubilee

National Fisheries Conference (NFI)

Louisiana Seafood Cookoff

Louisiana Restaurant Expo

Louisiana Alive

Legislative Day

International Shellfish Sanitation Conference

Great American Seafood Cookoff

Education Day

Boston Seafood Show

Bonne Crevette

Alligator Cookoff

Event

Sample Usage – Sub-Revenue SourceDEPT OF WILDLIFE AND FISHERIES:

For DWF, Sub-Revenue Sources can be unique to a

given Revenue Source

ATTORNEY GENERAL’S OFFICE: Sample Usage – Reporting Category

Breakdown of Expense Objects– Object 3650 Other Charges, use Reporting Category

7136 for “Court Filing Fees”

Inter-Agency Agreements– There are 15 agreements and 1 object and 1 org– Use reporting category to define which agreement– Ex., 0017 – SG – Office of Risk Management

Grants

Division of Administration: Sample Usage – Sub Revenue Source

HOUSING AUTHORITY - BERWICKSGBVH05

HOUSING AUTHORITY - BOGALUSASGBUH04

HOUSING AUTHORITY - ALEXANDRIASGBTH03

HOUSING AUTHORITY - COLFAXSGBSH02

HOUSING AUTHORITY - ABBEVILLESGBRH01

BOARD OF EXAMINERS - SANITARIANSSGBPB53

BOARD OF EXAMINERS - CHIROPRACTORS- DHHSGBOB06

BOARD OF HEARING AID DEALERS SGBNB33

BOARD OF EXAMINERS - WHOLESALE DISTRIBUTORSSGBMB36

HOUSING AUTHORITY - HAYNESVILLESGBLH86

BOARD OF VETERINARY MEDICINE SGBKB34

BOARD OF BARBER EXAMINATION SGBJB46

BOARD OF PLUMBERS SGBIB16

COMMISSION - TAX FREE SHOPPING SGBHA40

HOMELAND SECURITY & EMERGENCY PREPAREDNESSIAT8D111

DIVISION OF ADMINISTRATION - STATE REGISTERIATFH107

DIVISION OF ADMINISTRATIONIAT02107

MENTAL HEALTH ADVOCACYIAT01103

INDIAN AFFAIRSIAT6B101

EXECUTIVE OFFICEIAT6A100

AGENCY NAMETYPESUB REVAGCY
































































IAT = Inter-Agency TransferSG = Self Generated

Sub-Revenue Sources don’t change across Revenue Sources

Division of Administration: Sample Usage – Reporting Category

Used heavily to track revenues and expenditures for grants

– Ex.

CDBG FFY '08 TECHNICAL ASSIST08TA

CDBG FFY '08 PROGRAM INCOME08PI

CDBG FFY '08 PUBLIC FACILITIES08PF

CDBG FFY '08 LASTEP08LS

CDBG FFY '08 HOUSING08HS

CDBG FFY '08 ECONOMIC DEVELOP08ED

CDBG FFY '08 DEMONST NEEDS08DN

CDBG FFY '08 COMMUNITY CENTERS08CC

CDBG FFY '08 ADMIN COST08AD

DescriptionReportingCategory

CDBG FFY '08 TECHNICAL ASSIST08TA

CDBG FFY '08 PROGRAM INCOME08PI

CDBG FFY '08 PUBLIC FACILITIES08PF

CDBG FFY '08 LASTEP08LS

CDBG FFY '08 HOUSING08HS

CDBG FFY '08 ECONOMIC DEVELOP08ED

CDBG FFY '08 DEMONST NEEDS08DN

CDBG FFY '08 COMMUNITY CENTERS08CC

CDBG FFY '08 ADMIN COST08AD

DescriptionReportingCategory

Division of Administration: Sample Usage – Reporting Category (cont’d)

Used to track Inter-Agency billings for building usage, payroll, & projects

– Ex.

OIS- PC/LAN SOFTWAREBL75

OIS- PC/LAN HARDWARE-EXCL PRNTBL71

OIS-TCP/IP APPLICATIONS SUPPTBL70

OTM / BILLINGAN07

PAYROLL EXPENDITURE CLEARING8888

ARSENAL1374

WOODDALE TOWER1373

DescriptionReporting Category

OIS- PC/LAN SOFTWAREBL75

OIS- PC/LAN HARDWARE-EXCL PRNTBL71

OIS-TCP/IP APPLICATIONS SUPPTBL70

OTM / BILLINGAN07

PAYROLL EXPENDITURE CLEARING8888

ARSENAL1374

WOODDALE TOWER1373

DescriptionReporting Category

38

As Is – Additional Information

Leading Practices

Enter transactions at the lowest level to meet all reporting requirements

Use a standardized, intelligent numbering scheme to facilitate reporting

Centralized maintenance of master data to ensure numbering scheme and derivation strategy are properly maintained

Consist of the necessary level of detail to meet the various reporting requirements of an organization

Field design should accommodate current design as well as allow for future growth

Process Improvement Opportunities

Streamline Business Processes and Standardize usage of Cost & Revenue Object codes and other Master Data – across the State…..

…..while still providing the agencies the flexibility they need for their internal reporting.

Make sure the system provides good visibility and detail needed for the agencies.

Make it easy for addressing CAFR and other Reporting needs of the State.

41

Example:

Z10 - True Internal Orders

Z20 - Statistical Internal Orders

Internal Order Types (W-I-P)

Classification used to identify Internal Orders for different purposes

Q: What are the Internal Order Types that make sense for LaGov?

42

SAP Numbering Considerations

(1) (2) (3) (4) (5) (6) (7) (8)

What’s the logical breakdown of the Data that will be represented as Internal Orders? And Internal Order Types?

Does this breakdown support both budgeting and actuals Reporting?

How will the breakdown for AFS and DOTD Finance be aligned?

Does the numbering scheme support FM Derivations?

Does the numbering scheme bring Standardization & Consistency?

43

Internal Orders: State of Louisiana Proposed Numbering Convention

W-I-P

(1) (2) (3) (4) (5) (6) (7) (8)

(1)– (2)

IO Type

(3)– (8)

Internal Order Number

• Other Internal Order Types can be created as needed; room for expansion.• IO Master Record

• Will store Agency information (Business Area).• Has provision to store other key data as needed:

• Cost Center• FM Object (Funded Program)

Z10 – True Internal Orders

8 digit internal numbering (System generates the number).

The first 2 digits indicate Internal Order Type: True Internal Order– 10: True Internal Order

Last 6 digits sequentially generated by the system when the Orders are created.

For True Orders: “Business Area” and “External Order Number” fields could be mandatory and may contain Agency and the relevant Legacy account code. May also have the FM Object needed to control the Budget (i.e. Funded Program) on the master record. “Cost Center” field may be “Optional”(TBD).

The

10000000 to 109999999Number Range:

Z20 – Statistical Internal Orders

8 digit internal numbering (System generates the number).

The first 2 digits indicate Internal Order Type: Statistical Internal Order– 20: Statistical Internal Order

Last 6 digits sequentially generated by the system when the Orders are created.

For Statistical Orders: “Business Area” field would be mandatory and will contain Agency number. “External Order Number” and “Cost Center” fields may be “Optional” and will contain Legacy account code and Cost Center respectively (TBD).

20000000 to 209999999Number Range:

Business Process Flow (W-I-P)

State of LouisianaProcess: Create New Internal Orders

OP

BD

epar

tmen

t/Age

ncy

OS

RA

P

New requirement identified for new

Internal Order

Start

Complete Master Data Request

Form

Email completed form to Internal Order Creation

mailbox

Email request received

Is request valid? Is new Internal Order

necessary?

Decline request and notify requestor

Code entries to existing Internal

Order

NO

YES

Create Internal Order in SAP

Notify Budget for Funds

Management Object creation

Create Funds Management Object in FM

Update FM and GM Derivation

Strategies

Code entries to new

Internal Order

Post entries to Cost Center End

Post budget for new FM Object

Is budget control necessary for this

Internal Order?

YesNo

47

Business Process Flow (W-I-P)O

PBO

SRAP

Dep

artm

ent/

Agen

cy

48

SME & end-user education on Internal Order Concepts, Numbering and proper usage.

Sorting through all Sub-Objects and other legacy data elements and identifying valid Internal Orders and Order Types.

Acceptance and Change Management of the new To-Be Process.

Training on new Internal Order creation and maintenance process.

Enterprise Readiness Challenges

49

Prepare and send out meeting minutes to invitees; ensure all to-do’s are appropriately documented.

Follow up on action items identified during the workshop.

Plan follow on workshops, as required.

Schedule off-line meeting(s) to discuss areas of special interest by Agency/Department as needed.

Identify all Internal Orders by Type.

Finalize IO Numbering Scheme.

Prepare Draft Design Document.

Plan validation workshop.

Validate Design Document.

Next Steps

Questions?

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51

Thank You for

Your Participation!

Version 1 - Louisiana Presentation.pdf · Version 1.0. Internal Orders. FI-CO-002 August 19, 2008...

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Transcript of Version 1 - Louisiana Presentation.pdf · Version 1.0. Internal Orders. FI-CO-002 August 19, 2008...