FMS-Rollout
Journal Entry& Reporting(JER)
October 2012
In the service of Kapamilya
SMOM System
ABS-CBN Interactive
and MMOG
• To document the as-is and to-be process of
ABS-CBN Interactive and MMOG
• To implement SAP system
• To identify additional activities/scenarios that
needs to be addressed
In the service of Kapamilya
SMOM System
Objectives
Definition of Terms
Shared Service Center – refers to the Finance group of ABS-CBN
Shared Service Center Pte., Ltd - ROHQ. It is a convergence
and streamlining of the ABS-CBN and its Subsidiaries to
ensure efficient and effective provision of certain services to
the organization.
In the service of Kapamilya
SMOM System
SAP (Systems, Applications and Products in Data Processing) –
system to be used for order processing, order fulfillment,
invoicing until payment collection and application
FMS Process Overview
Budgeting & Margin
Analysis
Financial Asset
Management
(Treasury)
In the service of Kapamilya
Journal Entry
Order to Cash
Accounting &
Reporting
Fixed Asset
Management
SMOM System
Order to Cash
Requisition to
Payment
Journal Entry and Reporting
As-Is Process Overview
SSC-GL
Post Journal
Entries
Accrual Entries
Prepares Reversal
Entries
Encoding of
Entries
Post Sales Register
Peachtree
Prepares Adjusting
Journal Entries
Prepares Monthly
Schedule
Bank
Reconciliation
Check Balances
Generate and
Print Trial Balance
and Financial
Reports
Consolidate FS
Management
Reporting
Yes
Errors?
Post Cash Receipts
No
In the service of Kapamilya
Statutory Reports
SMOM System
ABSI and MMOG
As-Is: Master Data Maintenance
The following are the master data currently being maintained in
Peachtree by General Accounting group.
• Chart of Accounts (COA) – GL account
•Profit Centers
In the service of Kapamilya
SMOM System
• Cost Centers/IO
As-Is: Master Data Creation
(ABSI and MMOG)
ABSI & MMOG Finance Officer
SSC GL Finance Analyst
Start
Review and verify
request
SSC GL Functional Manager
Yes
No
Complete
?
Notes:
Account description
Nature of account
Maintain COA (GL
Account)
Associate Center
Group to COA
End
Email completion
of request
In the service of Kapamilya
Approve creation
of new account
 GL Account code
 Account classification
 Report Group (IS or BS)
 Account’s normal balance
(dr/cr)
 Center Group
SMOM System
Email Request
Business Process Gap Analysis
Request for new and to
change Master Data (GL
account and cost centers)
are done through email or
verbally.
Risk/Impact
• Prone to human error
• Possibility of longer
processing time due to
incomplete information
provided.
• Since the approval are made
either in email or verbally,
there was no tracking who
requested and who approve
the request.
The Company is not using
Difficulties in manual mapping
the Chart of Accounts of the of accounts for consolidation
Parent Company.
purposes.
In the service of Kapamilya
Proposed Solution
On-line GL Master Data
Maintenance request and
approval
The Company shall use the chart
of accounts of the Parent
Company. Necessary accounts
not yet existing will be created
in SAP.
SMOM System
Issues/Concern
As-Is: Journal Entry
Manual (ABSI)
ABSI Finance Analyst
ABSI Finance Officer
SSC GL Finance Analyst
Start
Forward to FO for
approval
No
Approve?
Note: Includes
Adjustments
Accruals
Translists Recording
Yes
Verbally inform FA
good for posting
Forward to SSC GL
for posting
In the service of Kapamilya
Post journal
entries
End
SMOM System
Prepare Journal
Entry in Excel
As-Is: Journal Entry
Manual (MMOG)
MMOG Finance Officer
SSC GL Finance Analyst
Start
Forward to SSC GL
for posting
Post journal
entries
End
Note: Includes
Adjustments
Accruals
Translists Recording
In the service of Kapamilya
SMOM System
Prepare Journal
Entry in Excel
As-Is: Month-end / Year-end
Closing
I.
Ensure completeness of transactions for the period
(general journal books, sales book, cash receipts book and cash disbursement
books)
II.
Reviews JV of other sections.
IV. Generation of Trial Balance in Peachtree
V.
Generate TB-General Ledger Report and TB-Account code from Peachtree
VI. Computes and post Provision for Impairment Loss.
VII. Computes and update income tax computation for the period.
VIII. Prepares Financial reports (Parent reporting requirement).
IX. Prepares statutory reports
In the service of Kapamilya
SMOM System
III. Ensure completeness of reversing entries in the accrual module.
As-Is: Reporting
Reports & Schedules (Peachtree):
• BS Account Schedules
• Financial Statements
In the service of Kapamilya
SMOM System
• Asset Lapsing schedules
Business Process Gap Analysis
Risk/Impact
Manual preparation • Manual processing is time
of balance sheet
consuming and
schedules and
susceptible to errors
reconciliations
• Increase in manpower cost
 Bank recon
 Accounts
Receivable
 Payables
 Due to/from
accounts
Verbal approval of
requests
•Since the approval are made
either in email or verbally,
there was no tracking who
requested and who approves
the request.
In the service of Kapamilya
Proposed Solution
• Balance Sheet report will be generated
in SAP
• AR balance report and other revenue
streams can be generated from SAP
• Invoice and OR details will be
generated from SAP
• Maintain manual preparation of bank
reconciliation if the bank/s can’t
provide us the required upload
• Online approval using Lotus Notes
SMOM System
Issues/Concern
SMOM System
To-be Process
In the service of Kapamilya
Process Overview - JER
Capture/Process
Financial
Transactions
(Daily Processing)
Month-end/
Year-end
Process
Financial
Reporting
OBJECTIVES:
• Ensure proper and consistent recording of financial transactions
• Provide timely and relevant reports showing financial position of the subsidiary
as well as addressing statutory requirements.
In the service of Kapamilya
SMOM System
Maintain
GL Master Data
(Chart of
Accounts)
To-be Process Overview
Collection
Application of AR
Master Data
Maintenance
Capture
transactions
Set-up of
Payables
Journal
Entries
Books of
Accounts/
Subs. Ledger
Month-end
Processing
Trial Balance
Financial
Reports
Upload to
Cognos-Controller
Management
Reporting/
Consolidation
In the service of Kapamilya
Audit Schedules
Balance Sheet
Recon Accts.
SMOM System
Set-up of Sales
& Revenue
Objectives- Journal Entry and
Reporting
Objectives
Master Data Maintenance (COA,
IO/CC/PC)
• To maintain single Chart of Accounts, IO,CC and PC
• To ensure consistent application and treatment of GL
accounts
Capture Financial Transactions
• To ensure proper capture of transactions consistent with
ABS-CBN parent
• To minimize number of manual journal entries/adjustments
Month-end/Year-end Closing
• To reduce month-end activities and spread-out GL
processing throughout the month
• To decrease manual processes
Financial Reporting and consolidation
• To simplify financial reporting and decrease manual
processes
• To eliminate manual process of financial consolidation with
other companies
In the service of Kapamilya
SMOM System
JER Sub-Processes
To-be: Master Data Maintenance
JER SUB-PROCESSES:
Capture Financial
Transactions
Month-end/
Year-end Closing
Financial
Reporting
KEY PERFORMANCE INDICATORS (KPIs):
• Accuracy of month-end reports
• Turnaround time from time request is received to account activation in GL Master Data.
1 hour
In the service of Kapamilya
SMOM System
Master
Data
Maintenance
To-be: Master Data Maintenance
ACTIVITIES:
Maintain
Primary &
Secondary
Cost Elements
Maintain GL
Master Data
Maintain
Financial
Statement
Versions
• Single Chart of Accounts , IO,CC and PC for ABS-CBN parent and subsidiaries
• On-line GL Master Data Maintenance request and approval.
• New GL accounts that are unique for ABSI/MMOG be created.
Sample GL Accounts for creation:
GL Accounts
Bank Accounts:
 Main Bank
 Deposit Clearing
 Payment Clearing
 Suspense Clearing
In the service of Kapamilya
Account Nature
To capture balances of bank accounts. A set of 4 GL
accounts are to be created for each bank account
maintained by the company
SMOM System
Design Highlights:
To-be: Master Data creation
SSC GL Finance Analyst
ABSI & MMOG Finance Analyst
Review/Approved
Request
YES
Approved?
ABSI & MMOG Finance Officer
Forward request to
accounting staff
Create/change GL
master data
Notify requestor of
disapproval
Notify requestor of
completion of the
request.
NO
Review/Approved
Request
Type of Requests:
 Add GL Account
 Update GL Account
 Block GL Account
 Delete GL Account
In the service of Kapamilya
Reason/Justification for
denial is indicated
SMOM System
Fill-out On-line
Request Form in LN
SSC GL Functional Manager
To-be: Capture Financial
Transactions
JER SUB-PROCESSES:
Capture Financial
Transactions
KEY PERFORMANCE INDICATORS (KPIs):
• Accuracy of month-end reports
• Number of manual journal entries per month
In the service of Kapamilya
Month-end/
Year-end Closing
Financial
Reporting
SMOM System
Master
Data
Maintenance
To-be: Capture Financial
Transactions
Design Highlights
• Capture transactions at source
• Minimize journal entries by interfacing from external systems, using upload GL
program for voluminous transactions, using SAP templates, variants and recurring
entries
• On-line journal adjustment request form after closing cut-off
• Parking of documents before actual posting.
• Fewer transactions requiring controller’s approval.
In the service of Kapamilya
SMOM System
• Sub-ledgers to be owned by unit who owns the transactions
To-be: Capture Financial
Transactions
ACTIVITIES:
Integrate with other SAP
Module/
Components
SMOM System
Create Journal Entries/
Adjustments
In the service of Kapamilya
To-be: Capture Financial
Transactions
Fill-out On-line
Request Form in LN
ABSI & MMOG Finance Officer
SSC Financial Reporting
SSC GL Financial Reporting Manager
Review/
Approved
Request
Approved
Request
Transaction requiring 2nd
Level Approval:
− Major Accruals
− Write-offs
− Consolidation Entries
− Income Tax Related Entries
− Adjustment resulting from
reconciliation and analysis
Review/Approved
Request
Note:
– Request form will be obtained via Lotus Notes
– SSC-GL will indicate SAP doc number in request
form
– All request form will be kept on file for reference
– Any A/R & A/P request for adjustments will be
forwarded to SSC AR/AP for booking
In the service of Kapamilya
2nd
Level
Approv
al
NO
YES
Forward to
Controller
Transaction
requiring 2nd
SSC Controller
Level Approval:
− Major Accruals
− Write-offs
− Consolidation Entries YES
Approved
− Income
Tax Related Entries
− Adjustment resulting from
reconciliation and analysis
NO
Reason/justification
for denial must be
indicated
No
Notify Requestor
of disapproval
Forward request to
GL-SSC
No
Encode and Post
Journal
Adjustments
SMOM System
ABSI & MMOG Finance Analyst
To-be: Month-end/ Year-end
Closing
JER SUB-PROCESSES:
Capture Financial
Transactions
KEY PERFORMANCE INDICATORS (KPIs):
• Accuracy of month-end reports
•Number of Manual journal entries per month
In the service of Kapamilya
Month-end/
Year-end Closing
Financial
Reporting
SMOM System
Master
Data
Maintenance
To-be: Month-end/ Year-end
Closing
ACTIVITIES:
Reconciliation of
GL and SL
balances
Review of
clearing of
accounts
Applicable to yearend closing only
Generate Trial
balances and /
schedules
Consolidate and
Generate
Consolidated FS
Open/Close
Posting Period
Applicable to ABS-CBN Financial
Reporting-SSC sub-process
In the service of Kapamilya
Carry forwards
balances
SMOM System
Integrate with
other SAP Module/
Components
To-be: Month-end/ Year-end
Closing
Design Highlights
•
Remove as part of the process the reconciliation of Due to/Due from Accounts for
company codes in SAP
•
Spread-out processing of transactions:
 Amortization of prepayments (e.g. insurance, rent) will be set-up up-front by
Accounts Payable via recurring entries
•
Centralized control for opening/closing posting periods
•
Auto-reversal of accruals/deferrals to avoid double charging (Optional)
In the service of Kapamilya
SMOM System
Month-End and Year-End Closing
• Remove as part of the process the reconciliation of GL and SL balances of A/R and A/P.
To-be: Month-end/ Year-end
Closing
Reconciliation of GL/SL
Reconciliation will have to be done for the following accounts:
Comment
Bank Reconciliation
This will require reconciliation with the
balances per bank. Bank reconciliation will be
performed by SSC GL.
Due to/Due From
Reconciliation is required if direct crosscompany posting is not allowed for all
transactions within the ABS-CBN group.
In the service of Kapamilya
SMOM System
Transaction
To-be: Month-end/ Year-end
Closing
Review of Clearing Accounts
GL Account
Comment
Bank Reconciliation Clearing Accounts
• Bank – Deposit Clearing
• Bank Clearing – Payment Clearing
• Bank – Suspense Clearing
These reconciliation accounts are set-up for
each bank account subject to reconciliation
Inter-Company Clearing Account
Inter-Company transactions will be initially
posted to this account and closed to the Due
To/Due From accounts upon reconciliation.
In the service of Kapamilya
SMOM System
The following clearing accounts will have to be set-up in the system and have to be
reviewed at month-end to ensure that the account has a zero balance.
To-be: Month-end/ Year-end
Closing
Generate Trial Balance & Schedules
Trial Balance
Use standard BS/PL report
Expense Schedules
Use standard SAP
Users will process the adjustment in GL, A/R or A/P of the concerned period.
ABSI and MMOG-Financial Reporting will provide formats of existing reports/schedules which need to
be used other than the standard & customized reports currently available in SAP.
If needed ABSI and MMOG will be given a customized reports/schedules based on their existing
format. These reports will be considered unique for the company.
In the service of Kapamilya
SMOM System
The following reports will be generated to facilitate review of interim Financial Statements:
To-be: Month-end/ Year-end
Closing
Consolidation
• Download actual balances of all companies in SAP to Cognos - Controller
SMOM System
• Consolidation will be done in Cognos - Controller
In the service of Kapamilya
To-be: Month-end/ Year-end
Closing
Opening/Closing of Financial Posting Periods
• SSC-Financial Reporting in ABS-CBN Parent will control closing period in SAP: General Ledger, Customer
Ledger, Vendor Ledger, Inventory Ledger
•Calendar year will be maintained as the GL posting periods
Posting Period
These posting periods correspond to the calendar month. These will
capture the regular monthly transactions
13
This posting will be used to capture adjustments resulting from
investments in subsidiaries
14
This posting period will be used to capture External Auditor
adjustments
Policy on closing of period - All modules will be closed by end of day of the second working day of the
new month. Only one period will be kept open at any time; however during the period closing, the GL
module will be kept open until the 5th working day of the new month (target closing period). Reopening of closed period shall be subject to approval of ABS-CBN CFO.
In the service of Kapamilya
SMOM System
1 – 12
Description
To-be: Financial Reporting
JER SUB-PROCESSES:
Capture Financial
Transactions
Month-end/
Year-end Closing
KEY PERFORMANCE INDICATORS (KPIs):
• Accuracy of month-end reports
• Reduction in number of ad-hoc requests for management reports
In the service of Kapamilya
Financial
Reporting
SMOM System
Master
Data
Maintenance
To-be: Financial Reporting
Generate
Financial
Statements
The following basic financial reports will be generated for each company under the
ABS-CBN group of companies:
• Income Statement
• Cash Flow
• Details of Receivables and Payables
• Details of Due to/from Affiliates
Other SAP generated reports:
• Aging of Accounts Receivable
• Aging of Accounts Payable
In the service of Kapamilya
SMOM System
• Balance Sheet
Next Steps
Implementation of SAP based on the To-be process
Conversions
BIR Requirements
Go-live of SAP system
SMOM System
•
•
•
•
In the service of Kapamilya
End of
Presentation