Department of Financial Services 1.1. General Information Process Area P2P - Procurement to Payment Process 1. Establishing Encumbrances Workflows 2. Invoice to Voucher 3. Voucher through Payment 4. Vendor Registration (not included) 5. 1099 Reporting (not included) 6. Contracts 7. Travel 8. Due to Due From 9. Direct Load and PCard As of 06/05/2015 1.2. Authors and Contributors Authors Deb Gries, State Process Lead Warren Bone, EY Process Lead Robin Chichester, EY Process Analyst Contributors Department of Environmental Protection Department of Financial Services Fish and Wildlife Commission Department of Agriculture and Consumer Services Department of Health Department of Highway and Safety Motor Vehicles Justice Administrative Commission Department of Management Services Department of Management Services - MFMP Department of State 1.3. Scope The scope of the Florida PALM Procurement to Payment (P2P) process area encompasses the financial management and accounting processes as it related to payment of the state’s financial obligations of which procurement related expenses are a part of. Because the State of Florida has already established an enterprise-wide procurement system known as MyFloridaMarketPlace (MFMP), the scope of the P2P process area in Florida PALM has changed from the Level 1 workgroup and process flows in that it will not include process modeling or descriptions of the procurement cycle that do not in-and-of-themselves create accounting events. Florida PALM will not replace nor duplicate MFMP’s procurement-management functions. The P2P process area will include accounting events and internal controls that accompany the traditional procurement cycle as shown below: Page 1 of 28 Procurement to Payment 06/05/2015 Department of Financial Services Plan Budget Solicit Order Receive Pay The P2P process area includes, but may not be limited to: Establishing Encumbrances Payment: Invoice/Credit to Voucher (includes PCard and Direct Load payments) Voucher to Payment (includes PCard and Direct Load payments) Payment Reconciliation and Escheatment Vendor Management. Contracts Travel Intergovernmental Billing (Due to/Due From) Florida PALM will work with DMS/ MyFloridaMarketPlace (MFMP) to establish integration points. Florida PALM will work with the small number of Florida state agencies which do not utilize MyFloridaMarketPlace provide to integration points and integration standards. These state agencies will then be responsible for integrating their internal systems with Florida PALM. 1.4. Assumptions Vendors will continue to register in MFMP’s Vendor Information Portal (VIP). Information collected in VIP will continue to be used to populate the State’s master file of vendors and payees The State’s master file of vendors and payees will be maintained in Florida PALM Agencies not using MFMP will have integration points established to be able to directly interface with Florida PALM Select agencies will continue to directly interface their direct load payment requests to the State’s accounting system. DFS will continue to establish and apply pre-payment audit criteria and transaction sampling for payment requests Access to confidential records including transactions containing sensitive data elements (e.g., social security numbers, personal/corporate banking information) will continue to be restricted Florida PALM will restrict access to agency specific transactions, etc. (e.g. agencies cannot view another agency’s transactions) The State’s new Purchasing Card system will interface with Florida PALM Florida PALM will provide the capability to consolidate multiple payments from multiple funding sources and multiple agencies to a single vendor while maintaining the ability to provide detailed payment information at the transaction level for 1099 Reporting Page 2 of 28 Procurement to Payment 06/05/2015 Department of Financial Services A very wide variety and large number of users will need to be provided access to various functions of Florida PALM (e.g., inquiries, transaction-level detail, field values, etc.) Florida PALM will provide the capability to pre-encumber Florida PALM will provide the capability of recording multi-year encumbrances and converting a future encumbrance to a current encumbrance at the beginning of a new fiscal year Florida PALM will have the capability of applying payment offsets to eligible vendor payments 1.5. Standardized Process Area Overview Encumbrances will be recorded for purchase orders issued from MFMP, the Contracts Module (FACTS), and agency business systems. Recording of the receipt of goods and approval of services is made by the agency outside the central accounting system. Invoice information may be entered manually or electronically (via live integration with MFMP) or integration with systems for agencies not using MFMP and will populate with the agency’s established workflow for role approvals. Vendor Management criteria will be modified to allow for the review of the vendor’s selected method of payment and request a change to wire payment at the time of invoice submission . The submitted invoice will create an accounting event and then pass agency discretionary budget controls to continue in the payment processing workflow. Agencies will have the ability to schedule payment dates prior to the prompt pay date to obtain prompt payment discounts Florida PALM will automatically schedule payments by the prompt pay date when not amended by the Agencies as per the reference above DFS Auditing will populate into the approval flow to pre-audit invoices based on defined sampling criteria. Upon full approval of the invoice, a voucher is created, encumbrances are reduced (if established) and allotments are reduced. The voucher may be a one-to-one correlation to the invoice and will be in the Scheduling Payment queue awaiting payment. One business day prior to payment the voucher will need to pass cash availability. At fiscal year-end, all open encumbrances will continue to be marked to use Carry Forward budget authority at the beginning of the next fiscal year unless otherwise requested. Payment status information will be maintained to include payments outstanding, those that have cleared the bank (presented and paid by Treasury), cancellations, disputes, etc. Warrants not cashed after 12 months will be subject to the escheatment process. 1.6. Process Area Details The tables below describe each step in the processes envisioned to use the functionality of Florida PALM accounting and payment subsystems to support accounting for pre-encumbrances and Page 3 of 28 Procurement to Payment 06/05/2015 Department of Financial Services encumbrances, registering and managing vendors, preparing and posting vouchers, paying vendors/payees, and reconciling payments, approving employee travel and reimbursements, accounting for Purchasing Card payments, Interagency billing and processing Direct Load payments. Nine workflow diagrams illustrate and accompany these standardized process area descriptions. They cover the following broad areas: 1. Establishing Encumbrances 2. Invoice to Voucher 3. Voucher through Payment 4. Vendor Registration (not included) 5. 1099 Reporting (not included) 6. Contracts 7. Travel 8. Due to Due From 9. Direct Load and PCard Workflow Page 1 of 9: P2P – Establishing Encumbrances Swim lanes – Definition Agency Accounting – Agency level accounting Agency Program/Unit Area – Agency program area Process Step ID Process Name Description of Process Governing Laws and Policies P2P 1.1 Agency’s Procurement Office Provides Purchasing Requirements Section 287.057, F.S. Section 255.0525, F.S. FACTS User Manual Appendix – Method of Procureme nt Codes Chapter 60A-1, F.A.C. P2P 1.2 Purchase/Obligation for Utility Payments, Travel, or Small Dollar Purchases Agency procurement personnel, guided by State law and Agency policies, dictate which of several different purchasing processes must be followed for any given purchasing transaction. Competitive quotes and bids may be solicited from vendors. Agencies conduct ITN, RFP, ITB, RFQ, Single Source procurements utilizing processes and systems outside of the Florida PALM. Agencies can also make purchases from existing valid contracts that have previously been competitively sourced, such as: State Term Contracts Alternate Contract Source Agency Contracts PRIDE RESPECT Direct purchases may be made if authorized by law, rule or policy. Utility payments, travel and certain small dollar purchases are exempt from Chapter 287 F.S. Many of these obligations are paid Page 4 of 28 Procurement to Payment • Section 287.057, F.S. • Section 287.058, F.S. • Section 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process through a manual invoicing process, employee reimbursement and/or the State Purchasing Card. P2P 1.3 Encumbrance Need Determined P2P 1.4 Input Encumbrance P2P CP 1.5 Florida PALM Checks Budget P2P 1.6 Passes Budget Check? Page 5 of 28 When the types of financial obligations are determined, the option to encumber all obligations will be available. The goal of DFS is to identify obligations for each agency for current and future years. Agency personnel will be able to enter information needed to establish an encumbrance in Florida PALM (e.g. vendor, encumbrance number, etc.). Encumbrances not created through a PO in MFMP will be created in Florida PALM or via a standardized interface from Agency business systems. The Budget Check will check appropriations for the agency by Budget Entity, Fund, Category, and, depending on the agency’s business rules, will be capable of further checking allotments down to the unit level. The Budget Check involves calculating allotments from appropriations, minus encumbrances, minus disbursements, minus scheduled disbursements, minus payables (not yet approved for payment) to determine the available balance. If available budget balances are sufficient, Florida PALM will encumber the transaction. If not, the agency will determine if a change in accounting or an override is warranted. If accounting codes are allowably and appropriately changed, the transaction is passed through budget check again. If this check is successful, Florida PALM will encumber the transaction. If available budget balances are still not sufficient after accounting code changes (or if accounting codes are not changed) Florida PALM will provide the capability for a duly authorized Agency user to override the available budget within Agency- established or statutorily appropriated limits. For example, in July of each year, allotments Procurement to Payment Governing Laws and Policies 112.061, F.S. • Chapter 60A-1, F.A.C. TBD TBD TBD TBD 06/05/2015 Department of Financial Services Process Step ID Process Name P2P CP 1.7 Override Available Budget P2P AE 1.8 Encumbrance Established P2P 1.9 Need to Adjust Encumbrance? P2P CP 1.10 Adjustment Approved Description of Process may not yet have been entered down to the unit level and a budget check failure may need to be overridden to allow the payment to be authorized. If available budget balances are not sufficient, Florida PALM will not allow the transaction to proceed unless an appropriately authorized position in Agency Accounting overrides the budget check. Note: should the budget check fail at the Appropriations level, direction from the agency’s Budget and Finance Director is needed to move the transaction. Once all prerequisite information has been entered for the transaction and available budget has been checked or overridden, an encumbrance will be created in Florida PALM. Establishment of an encumbrance will result in the following accounting entries in Florida PALM ledgers: DR Encumbrances CR Budgetary Fund Balance Reserved for Encumbrances If a non-PO related encumbrance needs to be adjusted after initial establishment a request will be submitted in Florida PALM via workflow. Note: A PO related encumbrance will be amended based on a change from MFMP and/or Agency Business Systems. Request will go to agency accounting personnel to process the request. Governing Laws and Policies TBD TBD TBD TBD Workflow Page 2 of 9: P2P – Invoice to Voucher Page 6 of 28 Procurement to Payment 06/05/2015 Department of Financial Services Swim lanes – Definition Enterprise Accounting (CFO) – Personnel within the Department of Financial Services (DFS) Bureau of Auditing and Accounting (A&A) responsible for auditing activities Agency Invoice Approver – Agency personnel responsible for final editing and approval of the invoice transaction before DFS Sampling criteria is applied Agency Invoice Reviewer – Agency personnel responsible for initial review and editing of the transaction before the 2nd level/ final approval of the transaction. Agency Program Approver – Agency personnel to authorize approval of the transaction to move to accounting personnel Agency Invoice Processor – Agency personnel to key invoice into Florida PALM Agency Receiver or Approver – Agency personnel receiving goods at the unit level Process Step ID Process Name Description of Process P2P 2.1 Receive Goods/ Approve Services Evidence of proper receipts of goods and approvals of services will continue to be recorded by the Agency and/or in MFMP by the “Agency Receiver or Approver” and are used as the basis to approve payment of an invoice. P2P 2.2 Authorized Invoice/Credit Received P2P AE 2.3 Invoice/Credit Submitted Invoices are received by agency business units/ appropriate billing locations and authorized for payment according to current rule, statute and agency policy manually and/or through MFMP. These invoices are then submitted to agency personnel (referred to as an Invoice Processor) for manual entry into Florida PALM. Note: If a need to issue payment by wire has been identified, the justification statement must be included with the invoice. An Invoice “Processor” will be able to enter information from the vendor invoice to create an invoice in Florida PALM as well as select information (e.g. vendor, encumbrance number (if established) PO#, etc. and be able to enter comments, add attachments, etc. Upon submission, the Florida PALM invoice will populate with an approval flow (additional approvers can be added) to issue payment to the vendor. The invoice submission creates an accounting event on the General Ledger as follows: Page 7 of 28 Procurement to Payment Governing Laws and Policies • Section 215.422(1) – (3), F.S. • Section 215.86, F.S. • Section 216.181(16), F.S. TBD TBD 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process P2P 2.4 Program Approver P2P CP 2.5 Florida PALM Checks Budget P2P 2.6 Review Invoice P2P 2.7 Passes Budget Check? Page 8 of 28 DR (Accrued Expense) CR (Payable ) The appropriate program level personnel will review the transaction. If approved, the transaction will move to the Budget Check. If disapproved, the transaction stays with the approver for resolution. Upon approval by the Agency Program Approver the transaction moves through to Budget Check. The Budget Check will check appropriations for the agency by Budget Entity, Fund, Category, and, depending on the agency’s business rules, will be capable of further checking allotments down to the unit level. The Budget Check involves calculating allotments from appropriations, minus encumbrances, minus disbursements, minus scheduled disbursements, minus payables (not yet approved for payment) to determine the available balance. The results of this Budget check will populate on the transaction and move the transaction through to the Agency Invoice Reviewer. The Invoice Reviewer identified for the Agency’s accounting office will review the transaction as to form, completeness (including required attachments), corrections and results from the budget check. If available budget balances are sufficient, Florida PALM will encumber the transaction. If not, the agency will determine if a change in accounting or an override is warranted. If accounting codes are allowably and appropriately changed, the transaction is passed through budget check again. If this check is successful, Florida PALM will encumber the transaction. If available budget balances are still not sufficient after accounting code changes (or if accounting codes are not changed) Florida PALM will provide the capability for a duly authorized Agency user to override the available budget within Agency- established or statutorily appropriated limits. Procurement to Payment Governing Laws and Policies TBD TBD TBD TBD 06/05/2015 Department of Financial Services Process Step ID Process Name P2P CP 2.8 Override Available Budget P2P 2.9 Invoice Approver Review Page 9 of 28 Description of Process For example, in July of each year, allotments may not yet have been entered down to the unit level and a budget check failure may need to be overridden to allow the payment to be authorized. If available budget balances are not sufficient, Florida PALM will not allow the transaction to proceed unless an appropriately authorized position in Agency Accounting overrides the budget check. Note: should the budget check fail at the Appropriations level, direction from the agency’s Budget and Finance Director is needed to move the transaction. The Invoice Approver is the Agency’s final level of approval from the Agency’s accounting office and will have final authority to formally initiate the transaction for disbursement. This role will have the permissions to modify the transaction if needed. If a transaction contains a request for wire transfer and justification appears sufficient, the Invoice Approver will approve the wire transfer request. Based on the invoice dates entered into the system the prompt pay date and payment due date (n compliance with FS 215.422) is automatically entered at the point of approval (allows the state to earn interest but remain in compliance with prompt pay requirements). Payment will not be made until the prompt pay date unless the agency has cause to modify the date, e.g. vendor has provided a discount for early payment. As long as the invoice meets all the appropriate requirements to pay, the Invoice Approver will approve the transaction. If the invoice is deficient, the Invoice Approver can disapprove/deny the transaction and will include comments on the transaction that outlines the deficiencies. This will return the transaction to the Program Approver for further action. Procurement to Payment Governing Laws and Policies TBD TBD 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process P2P 2.10 Select Audit Sample Certain transactions are selected for audit by the DFS Bureau of Auditing based on a set of DFS-defined audit criteria, such as transaction value thresholds specific vendor name/ID specific object codes specific account codes If the transaction does not meet DFS audit criteria, the transaction moves through for voucher creation. P2P CP 2.11 DFS Audits Transaction If a transaction meets DFS Audit Criteria, the workflow will direct the transaction to the role of DFS Auditor and the transaction moves to that queue for the DFS auditor to review. The approval flow will be populated to display the transaction status. Should the DFS auditor require additional documentation the auditor will return the transaction to the Invoice Approver. P2P AE 2.12 Create Voucher P2P 2.13 Invoice Approver Review P2P AE Invoice Approver Once the transaction has been fully approved and scheduled for payment, a voucher is created, the encumbrance is reduced (if one established) and allotments are reduced. The following accounting events occur at this point: DR (Expenditures) CR (Payable/Due To) And if payment was made against an encumbrance, the following accounting events occur: DR (Budgetary Fund Balance Reserved for Encumbrances) CR (Encumbrances) Final recording of approval moves the Voucher into the Payment Processing queue. Upon receipt of the transaction from the DFS Auditor, the Invoice Approver will obtain the additional documentation, attach the additional documentation to the transaction, and return it to the DFS Auditor. Should the Invoice Approver be unable to obtain the additional documentation required Page 10 of 28 Procurement to Payment Governing Laws and Policies • Section 17.03, F.S. • Chapter 69I-24, F.A.C • Chapter 69I-40, F.A.C. • DFS Reference Guide for State Expenditures • Section 17.03, F.S. • Chapter 69I-24, F.A.C • Chapter 69I-40, F.A.C. • DFS Reference Guide for State Expenditures • Section 215.422 (1)(3), F.S. • Chapter 69I-40.002, F.A.C. TBD TBD 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process 2.14 Rejects Transaction by the DFS auditor, they will deny the transaction which will automatically return it to the Program Approver. The Program Approver will be notified of the disapproval via email notification. The rejection of this transaction will result in the reversal of the previous GL entries that were made in P2P AE 2.3. Note: The transaction will remain in the system in order to document that the invoice was received, and to record the status of payment. Governing Laws and Policies Workflow Page 3 of 9: P2P – Voucher to Payment Swim lanes – Definition Treasury – Department of Financial Services (Treasury) Enterprise Accounting (CFO) – Personnel within the Department of Financial Services (DFS) Bureau of Auditing and Accounting (A&A) Agency Accounting – Personnel responsible for changes to cash at the agency level Process Step ID Process Name Description of Process P2P 3.1 Identify Items for Payment Verify Cash Nightly payment processing begins selecting payments with criteria for disbursement. P2P CP 3.2 P2P 3.3 Notify Agency P2P 3.4 Agency Resolves P2P CP 3.5 Treasury Wire Transfer Review Page 11 of 28 Before payment can be issued, Florida PALM will confirm the paying agency’s Treasury cash balance has sufficient cash balance to cover transactions. If cash is not sufficient, Florida PALM will automatically send notification to the Agency via workflow. Once sufficient verified cash has been confirmed the transaction passes to payment offsets. The agency may need to divest to make cash available and the transaction to go back through Verify Cash. Wire requests will workflow to the Treasury queue for review and where Treasury will reject by exception. (No action permits wire payments to be processed.) Procurement to Payment Governing Laws and Policies TBD TBD TBD TBD TBD 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process P2P CP 3.6 Payment Offsets P2P 3.7 P2P CP 3.8 Calculate Offset to Creditor and Available Balance to Vendor Paying Agency Approval Payment offsets may be deducted from the payment if the vendor has a delinquent debt owed to the State. ARB will post a daily file that Florida PALM will check against to determine vendors eligible for offset (e.g. there are no exemptions for their offset). DOR Levies will be processed in accordance with their policy. IRS Levies: If a request has been received by DFS to impose a levy, Vendor Relations will flag the vendor in the statewide vendor file. Backup Withholding: If a vendor is subject to backup withholding, the vendor will indicate through the registration portal, or Vendor Relations will flag the vendor in the statewide vendor file. The transaction will be work flowed to the Invoice Approver for validation that that the IRS Levy offset is still in force. The agency will attach supporting documentation if the IRS Levy is no longer in force. Otherwise, the agency will annotate to move forward with the calculation of the IRS Levy offset. If an offset is indicated, Florida PALM will calculate the amount of the offset due to the creditor and the remaining balance of the payment (if any) due to the vendor. P2P 3.9 Vendor and Page 12 of 28 The transaction will be workflowed to the agency approver For the offset to be applied to the payment, the paying agency will need to approve the revised payment amount. Should the paying agency approve the offset, the reduction in the payment amount due to the vendor will be made. Should the paying agency have an exemption to not apply the offset, they will need to document the exemption on the transaction and not approve the offset. Full payment as originally submitted will be processed to the vendor. Only by the paying agency approving the Procurement to Payment Governing Laws and Policies •Section 215.422 (1)(3), F.S. • Section 17.075, F.S. • Section 17.076, F.S. TBD TBD TBD 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process Benefitting Agency Notified P2P 3.10 Issue Payment P2P 3.11 Payment Settled? P2P 3.12 Payment Reconciliation P2P 3.13 Cancel Payment and Reissue? P2P 3.14 ACH Return? Page 13 of 28 offset will an automatic notification be transmitted to the benefitting agency and the affected vendor of the offset amount applied to this payment. ARBs daily offset file will be updated to include the amount of offset applied and other payment details as determined needed by them. Payment is made by one of the following methods: Wire Transfer (See above.) Journal Transfer (JT): Transfer of funds between agencies Physical Warrant: State issued financial instrument to pay the vendor. Electronic Funds Transfer (EFT): Electronically transferring funds from a state bank account to a vendor/payee’s designated account. As payments are issued, transaction records will be simultaneously updated to reflect the date of issuance and method of payment. Treasury will provide Florida PALM confirmation if and when issued payments have actually settled, i.e., been “paid” by the State’s bank When confirmation of settlement is received from the Treasury, Florida PALM will update transaction records to record the date and amount of payment and the transaction is marked as reconciled. Records of settled transactions are passed to several other process areas, including Projects, Grants, Assets and Cash as applicable. Stopped or canceled payments can be reissued if needed (e.g., lost or stolen warrant). ACH Returns occur when a Treasury ACH payment is transmitted to a vendor’s designated bank account, cannot be deposited by the Bank, and is returned via ACH to the State’s bank account. Most ACH Returns occur because vendors Procurement to Payment Governing Laws and Policies TBD TBD • Section 17.26, F.S. TBD TBD 06/05/2015 Department of Financial Services Process Step ID P2P 3.15 P2P 3.16 P2P 3.17 Process Name Description of Process Returned/ Unsettled Warrant Resolution and Reconciliation Escheatment Unclaimed Property have closed a bank account and failed to update their bank account information in the Vendor Master File. Transaction-level data for ACH Returns are sent to the DFS Bureau of Vendor Relations, which works with the paying agency and vendor to resolve the issue. Agency resolves any issues regarding a returned or unsettled warrant A warrant that has not been cashed and the State holds the warrant for one year. The transfer of funds happens in Unclaimed Property. The state follows unclaimed property processes to maintain amounts and resolve. Governing Laws and Policies TBD TBD TBD Workflow Page 6 of 9: P2P - Contracts Swim lanes – Definition Enterprise DFS A&A – Personnel within the Department of Financial Services (DFS) Bureau of Auditing and Accounting (A&A) Agency Program Approver and Contract Manager Agency personnel to authorize approval of the transaction Agency Contract Staff – Contract staff at the agency level Process Step ID Process Name Description of Process P2P 6.1 Enter Contract Terms and Conditions Agency contract staff inputs contract data (some data will be prepopulated from master vendor records) Executing Agency Vendor/Grantor Vendor/Grantor Address Minority Designation Vendor ID Type of Agreement Contract/Grant # Commodity/Service Type Description of Purchase Short Contract Title Long Contract Title Page 14 of 28 Procurement to Payment Governing Laws and Policies TBD 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process Governing Laws and Policies P2P AE 6.2 Generate FY Allotments P2P AE 6.3 Generate FY Encumbrance P2P CP 6.4 P2P 6.5 Program Review Manage Contract Page 15 of 28 Contract Status Date of Execution Start and End Date Statutory Authority Recipient/Vendor Method of Procurement Outsourcing/ Capital Improvements Original Contract Amount Non-Recurring Budget Recurring Budget Amount by fiscal year Changes/ Amendments Accounting Information Deliverables Deliverable Price Method of Payment Performance Metrics Financial Consequences Other information deemed necessary to track contract/ grant information (e.g., renewals) Supporting documents are uploaded and associated with the contract as necessary If the agency requires FY allotments by contract number, this is indicated by the agency on the contract and automatically established in Florida PALM. (Future FY amounts will be created for the agency July 1 of each FY). The allotment will undergo a budget check: if passed, will be established; if failed, the agency will take appropriate action for the GL. If the agency requires FY encumbrances by contract number, this is indicated by the agency on the contract and automatically established in Florida PALM. (Future FY amounts will be created for the agency July 1 of each FY). The allotment will undergo a budget check: if passed, will be established; if failed, the agency will take appropriate action for the GL. The Program Approver reviews and approves entries made in Florida PALM The Contract Manager is the liaison between Procurement to Payment TBD TBD TBD TBD 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process P2P 6.6 Perform Contract Review P2P IP 6.7 Finalize and Upload Audit Report with Agency Changes to Contract? P2P 6.8 P2P 6.9 Are Changes Needed to Closeout? P2P CP 6.10 Contract Complete the department and the vendor, and minimally, performs duties and responsibilities for the contract as outlined by the agency and timely processes invoices. DFS A&A performs a contract review/ contract management review based on established thresholds as identified with Florida Statute and Comptroller Memorandums. DFS A&A prepares and presents a report of audit findings to the agency and uploads the report from the CAS system in Florida PALM If a contract change/amendment (including termination) is required, the action will return to steps P2P 6.1 through 6.3 for appropriate adjustments If a contract change is required for closeout, the action will return to steps P2P 6.1 through 6.3 for appropriate adjustments. The contract manager needs to assess if there are financial changes associated with the closeout, such as unused funds or the final invoice being reduced for financial consequences or a balance in the Major Maintenance Funds, etc. If so the action will move through P2P 6.1 through P2P AE 6.3 (if appropriate) and P2P AE 6.4 to liquidate the reduce the allotments and/or encumbrance. When the term of the contract has been completed/ all services rendered, etc. the contract needs to be managed for closeout activities with the vendor and in Florida PALM. Governing Laws and Policies TBD TBD TBD TBD TBD Workflow Page 7 of 9: P2P – Travel Swim lanes – Definition Page 16 of 28 Agency Leadership – Leadership of agencies for approval Agency Program Approver/Direct Supervisor – Agency personnel to authorize approval of the transaction to move to accounting personnel Agency Staff – Employees requesting approval to travel Procurement to Payment 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process P2P 7.1 Submit Travel Authorization Request Agency staff completes, then submits the online Travel Authorization request form in Florida PALM. Submission of the online document creates a unique identification number. Documentation of costs must be attached when available (e.g. registration fee, conference hotel room charge, etc.) and if an advance is requested (80% of total costs may be approved), a justification statement of the financial hardship must be included on the form. Governing Laws and Policies TBD P2P CP 7.2 Review Travel Request Submission of the Travel Authorization request will move through the approval flow to the Agency’s Program Approver and/or the employee’s direct supervisor to Approve or Deny. TBD P2P 7.3 Travel Advance Requested? If request is not approved, the Request may be modified and resubmitted. The reasons for the original denial will remain permanently attached to the request. The Request may be abandoned, retaining a permanent record of the request and the reasons for rejection attached to the denied request. TBD P2P CP 7.4 Review Travel Advance If a travel advance was included on the Travel Authorization request, while in the approval flow, the request for advance will be reviewed. TBD P2P 7.5 Resolve and Resubmit Submission of the Travel Advance request will move through the approval flow to the Agency’s Program Approver and/or the employee’s direct supervisor to Approve or Deny. If approved, the Travel Request, with the request for advance, will continue through the process. If the request for advance is denied, the traveler may resubmit the Travel Request without the request for advance. TBD Page 17 of 28 Procurement to Payment 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process P2P 7.6 Require Leadership Approval? P2P CP 7.7 P2P 7.8 Leadership Reviews Request Encumber Travel Request? Encumber Travel Request If the Travel Authorization request included Out of State Travel or a conference, additional review and approval is required. Agency executive level approval is granted or denied at this step. P2P AE 7.9 P2P 7.10 P2P 7.11 Process Travel Advance? Travel Completed P2P 7.12 Submit Approved Travel Advance Request Advances via Agency Business Systems P2P IP 7.13 P2P AE 7.14 Submit Travel Expense Report/ Reimbursement Request P2P CP 7.15 Review Expense Report/ Reimbursement Request Page 18 of 28 Governing Laws and Policies TBD TBD The Request will create an encumbrance if indicated, otherwise it will proceed. TBD The Travel Request will be encumbered at this point. The encumbrance will include the ability to establish separate encumbrances if multiple travelers are included on the Authorization Request. If a Travel Advance needs to be processed, it will be submitted. TBD The approved request for a travel advance is submitted for payment. It is processed as an invoice (see P2P 2.3). Data from Agency business systems for advance requests are uploaded for processing to P2P AE 2.3. TBD Data from Agency business systems for advances are submitted for processing to P2P AE 2.3 At the conclusion of the travel the Agency staff completes, then submits the on-line Travel Reimbursement request form in Florida PALM for approval, with documentation of actual costs (e.g. invoices, receipts). DR (Accrued Expense) CR (Payable) Note: The Expense Report / Reimbursement Request should include the Travel Authorization number and if applicable, the encumbrance number Submission of the Travel Expense Report/Reimbursement request will move through the approval flow to the Agency’s Program Approver and/or the employee’s direct supervisor to Approve or Deny. If approved, the Travel reimbursement, with the request for advance, will continue TBD Procurement to Payment TBD TBD TBD TBD 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process P2P IP 7.16 Expense Report/Reimbursement via Agency business systems Governing Laws and Policies through the process. If the expense/reimbursement request is denied, the traveler may resubmit the Travel reimbursement without the request for advance. If approved an invoice is created (see P2P AE 2.3). If not approved the request is returned to the agency staff for correction and resubmission. Any unexpended travel advance owed by the employee, will be settled by the expense report process. TBD Data from Agency business systems for Reimbursement requests are submitted for processing to P2P AE 2.3 Workflow Page 8 of 9: P2P – Due To Due From Swim lanes – Definition Agency Program Approver – Agency personnel to authorize approval of the transaction to move to accounting personnel “Due From” Agency (Paying Agency) – The agency that is paying “Due To” Agency (Billing Agency) – The agency that is billing Process Step ID Process Name Description of Process P2P 8.1 Inter-agency Due To/ Due From Shared View Update P2P 8.2 Acknowledge AR Invoice P2P 8.3 Appears Billed Correctly? P2P 8.4 Return for Additional Page 19 of 28 The “Due to” agency (the billing agency) will post the created receivable in Florida PALM. We envision a “shared view”** for the billing agency and the “Due From” agency (the paying agency). Governing Laws and Policies TBD TBD The “Due From” agency will acknowledge that the “Due To” agency has billed them, but this is acknowledging receipt of the receivable only and not approval. TBD This is to determine if there is sufficient detail to know that the invoice belongs to the “Due From” agency. TBD If the answer to P2P 8.3 is no, but it is not evident that the AR invoice does not belong Procurement to Payment 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process Information? P2P 8.5 P2P 8.7 Notify Due To Agency that Additional Information is Needed Acknowledge Request for Additional Information Update Receivable P2P 8.8 Reject Receivable P2P 8.9 Acknowledge Rejected AR Invoice Update Receivable with Rejection Correct Due From Agency Number P2P 8.6 P2P 8.10 P2P 8.11 TBD TBD The “Due To” (billing agency) will input acknowledgement and take action to correct. The requested documentation is uploaded to the receivable. Note: For unpaid invoices, workflow will provide the ability to send notifications to the “Due From” agency triggered by elapsed time configurations. Workflow will allow for rejection with comments. The “Due To” acknowledges rejection. TBD The receivable is removed from the Due From agency’s shared view. TBD If the rejection was due to the invoice being billed to the wrong agency, the “Due To” agency will update the receivable to bill the correct agency. If the AR invoice received from the Due To agency is deemed legitimate by the agency user monitoring the shared view, workflow will be created to assign to an internal Program Approver. The Agency Program Approver will have the final review and if determined appropriate will edit the transaction to indicate approval to workflow to payment. Upon edit by the Program Approver, Florida PALM will automate conversion of the Due To invoice to a Due From AP invoice and will enter at P2P AE 2.3. TBD P2P 8.12 Assign to Program Approver P2P CP 8.13 Program Approver Review and Edit P2P 8.14 AR/AP Invoice Flip Page 20 of 28 to the agency, the billing agency needs to provide additional information. Workflow will be utilized to identify additional information needed. Governing Laws and Policies Procurement to Payment TBD TBD TBD TBD TBD 06/05/2015 Department of Financial Services Workflow Page 9 of 9: P2P – Direct Load and PCard Payment Swim lanes – Definition Enterprise (DFS Financial Reporting) – Personnel within the Department of Financial Services (DFS) Bureau of Auditing and Accounting (A&A) Agency Invoice Approver – Agency personnel responsible for final editing and approval of the invoice transaction Agency Invoice Processor – Agency personnel to key invoice into Florida PALM Process Step ID Process Name Description of Process P2P 9.1a. Direct Load Warrant Data (DOR, DEO, AHCA, DCF, DFS, DMS, …) PCard Payment Data For a certain type of payments, approved invoice payment requests are uploaded to PALM. For payments made to the state’s PCard provider. TBD P2P CP 9.2 Format Edits/ Data Validity Agency uploads undergo data format and validity edits. TBD P2P AE 9.3 Invoice/ Credit Submitted TBD P2P CP 9.4 Florida PALM Checks Budget The invoice submission creates an accounting event on the General Ledger as follows: DR (Accrued Expense) CR (Payable ) The Budget Check will check appropriations for the agency by Budget Entity, Fund, Category, and, depending on the agency’s business rules, will be capable of further checking allotments down to the unit level. The Budget Check involves calculating allotments from appropriations, minus encumbrances, minus disbursements, minus scheduled disbursements, minus payables (not yet approved for payment) to determine the available balance. If available budget balances are sufficient, Florida PALM will encumber the transaction. If not, the agency will determine if a change in accounting or an override is warranted. If accounting codes are allowably and appropriately changed, the transaction is passed through budget check again. If this check is successful, Florida PALM will encumber the transaction. TBD P2P 9.1b. P2P 9.5 Passes Budget Check? Page 21 of 28 Procurement to Payment Governing Laws and Policies TBD TBD 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process Governing Laws and Policies P2P 9.6 Approve Invoice P2P CP 9.7 Override Available Budget P2P CP 9.8 P2P AE 9.9 Direct Load Warrant Approver Create Voucher If available budget balances are still not sufficient after accounting code changes (or if accounting codes are not changed) Florida PALM will provide the capability for a duly authorized Agency user to override the available budget within Agency- established or statutorily appropriated limits. For example, in July of each year, allotments may not yet have been entered down to the unit level and a budget check failure may need to be overridden to allow the payment to be authorized. The Invoice Approver is the Agency’s final level of approval from the Agency’s accounting office and will have final authority to formally initiate the transaction for disbursement. This role will have the permissions to modify the transaction if needed. If available budget balances are not sufficient, Florida PALM will not allow the transaction to proceed unless an appropriately authorized position in Agency Accounting overrides the budget check. Note: should the budget check fail at the Appropriations level, direction from the agency’s Budget and Finance Director is needed to move the transaction. TBD DFS approval of direct load payments. TBD Once the transaction has been fully approved and scheduled for payment, a voucher is created, the encumbrance is reduced (if one established) and allotments are reduced. The following accounting events occur at this point: DR (Expenditures) CR (Payable/Due To) And if payment was made against an encumbrance, the following accounting • Section 215.422 (1)(3), F.S. Chapter 69I40.002, F.A.C. Page 22 of 28 TBD Procurement to Payment 06/05/2015 Department of Financial Services Process Step ID Process Name Description of Process Governing Laws and Policies events occur: DR (Budgetary Fund Balance Reserved for Encumbrances) CR (Encumbrances) Final recording of approval moves the Voucher into the Payment Processing queue. 1.7. Integration Points Integration ID P2P IP 1 P2P IP 2 P2P IP 3 P2P IP 4 P2P IP 5 P2P IP 6 P2P IP 7 P2P IP 8 FFMIS or Key System MFMP and Agency Business Systems Agency Business Systems MFMP CFO Transparency Portal Agency Business Systems Agency Business Systems Agency Business Systems Agency Business Systems Integration Description Upload encumbrance data to establish encumbrance. Upload approved invoices for voucher creation. These are subject to audit selection. Upload invoice for voucher creation. Upload contract data to transparency portal. Placeholder for Vendor Registration integration point. Upload allotments and/or encumbrances. Upload warrant payment files for data validation, budget edits and payment processing. Upload PCard payment files for data validation, budget edits and payment processing. 1.8. Control Points Control Pt. ID P2P CP 1 P2P CP 2 P2P CP 3 P2P CP 4 Page 23 of 28 Control Point Description Upon upload from agency business systems and MFMP, data format and validity edits in addition to a budget check are applied prior to establishing an encumbrance. This will ensure sufficient funds exist to allocate funds. Upon upload from agency business systems, data format and validity edits in addition to a budget check are applied prior to voucher creation. Upon upload from MFMP, data format and validity edits in addition to a budget check are applied prior to voucher creation. Upon upload from agency business systems, data format and validity edits in addition to a budget check are applied prior to establishing an Procurement to Payment 06/05/2015 Department of Financial Services Control Pt. ID P2P CP 5 Control Point Description allotment/encumbrance. This will ensure sufficient funds exist to allocate funds. Upon upload from agency business systems, data format and validity edits in addition to a budget check are applied prior to establishing an encumbrance. This will ensure sufficient funds exist to allocate funds. 1.9. Accounting Events Accounting Events are captured inflow. 1.10. Reports Report No. Description P2P R 1 Upload encumbrance error report Pending Credits by Vendor P2P R 2 Frequency and Triggering Event On Demand, Periodic On Demand, Periodic P2P R 3 Invoices Pending Approval On Demand, Periodic P2P R 4 Vouchers not Approved for Payment AP Aging Report On Demand, Periodic Payments made within 40 days of receipt of invoice Payments not made within 40 days of receipt of invoice Transactions approved for payment for a given day On Demand, Periodic P2P R 5 P2P R 6 P2P R 7 P2P R 8 Page 24 of 28 On Demand, Periodic On Demand, Periodic On Demand, Periodic Audience(s) Classification Governing Laws and Policies Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Accounting Staff, DFS Operational, Management TBD Operational, Management TBD Operational, Management TBD Operational, Management TBD Operational, Management TBD Operational, Management TBD Operational, Management TBD Agency Accounting Staff, DFS Operational TBD Procurement to Payment 06/05/2015 Department of Financial Services Report No. Description P2P R 9 Payment transactions processed for a given day Discounts taken P2P R 10 P2P R 11 Frequency and Triggering Event On Demand, Periodic Audience(s) Classification Governing Laws and Policies Agency Accounting Staff, DFS Operational, Management TBD On Demand, Periodic Agency Accounting Staff, DFS Agency Accounting Staff, DFS Operational, Management TBD Operational, Management TBD Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Accounting Staff, DFS Management TBD Operational, Management TBD Operational, Management TBD Operational, Management TBD Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Accounting Staff, DFS Operational, Management TBD Operational, Management TBD Operational, Management TBD Agency Staff, DFS Operational, Management TBD AP activity against allotments and encumbrances Average number of days for payment Offsets Processed On Demand, Periodic P2P R 14 Number of wire requests pending On Demand, Periodic P2P R 15 Number of wire warrants/ACH payments produced Outstanding Warrants On Demand, Periodic P2P R 17 Average daily clearance On Demand, Periodic P2P R 18 1099 Reconciliation Report (Placeholder for Vendor Registration) Open Contracts On Demand, Periodic P2P R 12 P2P R 13 P2P R 16 P2P R 19 Page 25 of 28 On Demand, Periodic On Demand, Periodic On Demand, Periodic On Demand, Periodic Procurement to Payment 06/05/2015 Department of Financial Services Report No. Description P2P R 20 Contract Allotments Frequency and Triggering Event On Demand, Periodic P2P R 21 Open Contract Encumbrances On Demand, Periodic P2P R 22 Number of contracts being audited by DFS Contract Changes / Renewals Contracts Ready to Close On Demand, Periodic Number of pending travel authorization requests Open/Unapprove d Travel Requests Travel Advance Requests On Demand, Periodic Out of State/Conference Travel Travel Requests not submitted for Reimbursement Time between Travel and Submitted Travel Reimbursement Request Time to approve Advance/ On Demand, Periodic P2P R 23 P2P R 24 P2P R 25 P2P R 26 P2P R 27 P2P R 28 P2P R 29 P2P R 30 P2P R 31 Page 26 of 28 On Demand, Periodic On Demand, Periodic On Demand, Periodic On Demand, Periodic On Demand, Periodic On Demand, Periodic On Demand, Periodic Audience(s) Classification Governing Laws and Policies Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Staff, DFS Operational, Management TBD Operational, Management TBD Operational, Management TBD Agency Staff, DFS Agency Accounting Staff, Agency Staff, DFS Agency Staff, DFS Operational, Management Operational, Management TBD Operational, Management TBD Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Accounting Staff, DFS Operational, Management TBD Operational, Management TBD Management TBD Operational, Management TBD Management TBD Agency Accounting Management TBD Procurement to Payment TBD 06/05/2015 Department of Financial Services Report No. P2P R 32 P2P R 33 P2P R 34 Description Reimbursement Request Unpaid Advance/ Reimbursement Requests Time to pay Reimbursement Request Direct load/PCard load report Frequency and Triggering Event Audience(s) Classification Governing Laws and Policies Operational, Management TBD Management TBD Operational, Management TBD Staff, DFS On Demand, Periodic On Demand, Periodic On Demand, Periodic Agency Accounting Staff, DFS Agency Accounting Staff, DFS Agency Accounting Staff, DFS 1.11. Key Performance Indicators/Measures Measure Relevance Receipt of Invoice to payment cycle time Overly prompt payment (without prompt pay discounts) adversely impacts Treasury cash management performance Untimely payments accrue interest Number, value of payments not paid by prompt due date Percentage of invoice line items Accuracy that are matched the first time Efficiency Cycle time in days to resolve an Efficiency invoice error Cycle time in days to approve Efficiency and schedule T&E Compliance reimbursements Cycle time in days from receipt Efficiency of invoice until payment is transmitted Number of FTEs for the process Efficiency "process accounts payable" per $1 billion purchases Page 27 of 28 Data Elements Needed to Generate Measure Standard pay-by date Actual pay date Number of payments not paid by prompt due date Value of payments not paid by prompt due date Invoice data Processing time Processing time, Volume Processing time FTE data Procurement to Payment 06/05/2015 Department of Financial Services Measure Relevance Total cost to perform the process "process accounts payable" per invoice processed Average cycle Time in days for an invoice to pass budget check for an invoice Average cycle time from Submitting a “Travel Authorization Request” to approval Average cycle time in days to approve and schedule T&E reimbursements Average cycle time to approve an invoice Percentage of invoice line items that are matched the first time Efficiency Data Elements Needed to Generate Measure Overhead, TBD Efficiency Invoice data, processing time Efficiency Invoice data, processing time Efficiency Compliance Invoice data, processing time, approved reimbursements Efficiency Compliance Accuracy Efficiency Invoice data, processing time Average cycle time in days to resolve an invoice error Average cycle time in days from receipt of invoice until payment is transmitted Percentage of disbursements that are first time error free Percentage of invoices which are manually keyed into the financial system Efficiency Invoice data, processing time, dispute data Invoice data, processing time, payment data Efficiency Compliance Accuracy Efficiency Accuracy Invoice data Processing time, payment data Invoice data, processing time 1.12. Future Enhancements TBD Page 28 of 28 Procurement to Payment 06/05/2015