Finance Forum
30 May 2012
Welcome & Overview
• David Sturgiss
Finance and Business Services
Overview
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Welcome and Overview
David Sturgiss
OCR and Proposed AP Workflow
Jaya Ganasan
University Banking Arrangements Post NAB
Jaya Ganasan
Finance System Upgrade Update
Eric Li & Leo Lai
Life After Finance & Business Services
Melissa Orr
Afternoon tea
Assets Cost Reconciliation
Lee Jnani
Recap of ARC Reporting
Lorraine Piper
Changes to Living Away From Home Allowances Luke Beckett
Project Updates
Vanessa Quigley
Risk Management & Audit Office
Yoon-Jin Park
OCR and Proposed AP Workflow
• Jaya Ganasan
Reason For Upgrade
• University currently running on V8.8. Oracle Extended
support for PeopleSoft Solutions 8.8 ended in Dec 2011.
• This means that Oracle is not obliged to provide
development support in the form of new features and
fixes including tax and regulatory updates to customers
running 8.8 after that time.
• University is also unable to benefit from the many
enhancements incorporated in the latest release –
version 9.1
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Project Status
• Upgrade project commenced in April 2011.
• Upgrade process involves both technical and functional
staff performing a number of “tests – fixes – retests”
cycles to ensure that the system and financial
processes are performing as they should on the new
version.
• Critical (risk mitigation) decision was made to upgrade
current processes without change, and implement new
functionality as follow-on projects.
• Scheduled for Completion and Go Live in July 2012 as
originally planned.
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Follow On/Concurrent Project - Review all
financial business processes
Objective
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to streamline and remove duplicative and
redundant activities
reduction / elimination of paper based forms.
standardization of financial business
processes across the University.
migration of paper based processes (eg travel
approvals) to on line systems.
achieve administrative efficiencies through
standardization and automation.
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Specific Improvement Opportunities
• Accounts Payable Invoice to Pay Automation
• Accounts Receivable and Miscellaneous Revenue
Collection
• Procurement Processes
• Travel Request and Approval Process and Travel
Related Expense Management
• Corporate Card Expenses Policy Compliance and
Acquittal Process Improvements
• Elimination of earlier modifications by adopting new
functionality
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Accounts Payable Invoice to Pay
Automation – Sept 2012
Use of Optical Character Recognition Scanning and
Peoplesoft Workflow will achieve the following outcomes:
- Reduction/elimination of data entry of Invoice information
- Email approval of scanned invoices
- Digital storage of invoice records (elimination of paper
storage)
- Improved turnaround times from receipt to payment of
invoices
- Complete transparency of AP work process flow
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Accounts Receivable and Miscellaneous
Revenue Collection – Dec 2012
Upgrade to One Stop Cash Receipting system and new
functionality in Peoplesoft will provide:
- opportunities to reduce cash collection points
throughout campus through introduction of web
based options.
- on line approval of invoices and credit notes
- conversion of paper forms to electronic versions
enabling on-line approvals.
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Procurement Processes Initiatives – Sept to
June 2013
• Integration of Chemical Inventory System with
Peoplesoft Procurement Module to eliminate duplicate
processes.
• Explore E- catalogue solution to enable fast search by
product and “side-by-side” product comparison to drive
best value purchasing.
• Mandatory requirement to raise Purchase Orders for
procurement exceeding $5,000 to:
– Simplify invoice processing
– Improve financial reporting and budget management
– Ensure compliance with procurement due diligence requirements
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Travel Request and Approval Process and
Travel Related Expense Management – March
2013
• Integrated on line system for Travel Requests and
Approval.
• Capture of all Travel Related expenses by Travel Event.
• Automatic general ledger account coding (based on
expense category).
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Corporate Card Expenses Policy Compliance and
Acquittal Process Improvements – March 2013
• On line system for Corporate Card Expenditure
Approval.
• Automatic general ledger account coding (based on
expense category).
• Email alerts and automatic escalation for unresolved
transactions.
• On-line forms and system controls to eliminate manual
forms and assist in tax compliance.
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Elimination of earlier modifications by adopting
new functionality
The following modifications will be redundant with the
adoption of new functionality in Peoplesoft Financials
-Corporate Card acquittal “bolt-on” and related AP/HR
integration.
-Accounts Payable Voucher approval modifications. (New
on-line approval workflow defined).
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Joint approach with Colleges to
improve systems
• We need University wide systems
• The Peoplesoft system will drive the
automation & workflow
• Sometimes a College will need extra steps
in a process (but rarely)
• College Finance Staff/
Managers/Academics to be part of the
team determining the best way forward
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QUESTIONS ?
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University Banking Arrangements Post
NAB
• Jaya Ganasan
Finance System Upgrade Update
• Eric Li & Leo Lai
From Now to Go live
Move to
Production –
Post User
Testing
Performance
Testing
Go live
Move to
Production –
Trial Go Live
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Feedbacks from End User Testing
• Changes on background colour &
navigation
• Tips & technique documentation required
for specific system changes
• No special training is required
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Major System Differences
• AP – Payment Comments
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Major System Differences
• Inventory – Changes on MSR
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Encumbrances Conversion
• Encumbrance balances will start from scratch
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No impacts on historical balances/reports
All open Reqs and POs will be set to ‘Complete’
Open POs over $10,000 will be re-entered centrally
All unapproved encumbrance Jrnls will be deleted
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General Information
• All personal favourites will be migrated into
v9.1
• Run Control IDs are required to be setup
• The log in to ES Financials will be
redirected to new page
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Conversion Strategy
• AP – all Vchrs must be approved and Match Exceptions must be
overridden
• PCard Vchrs – must be approved
• AM – Add/Update access will be removed after Accounting Period 7 (8th
July), no asset transactions should be added or modified
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All Reqs must be built into POs otherwise cancelled
• IV – all MSRs, Picking Plans and Counting Events must be completed
otherwise cancelled
• AR – all Invoices must be approved otherwise cancelled
– all Cancelled Invoices will not be converted
• GL - all Journals must be approved otherwise deleted
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Draft Go-Live Timetable
17th July (Tuesday)
 All ‘Add’ access will be removed
19th July (Thursday)
 All system access will be removed
 All unapproved Bills, Vouchers and Journals will be deleted
 For any unapproved PCard vouchers, the charges will go to
“5890 R Areas ‘510’ Dept or Cardholders Dept”
23rd July (Monday)
 Restricted access may be given to F&BS
24th July (Tuesday)
 System is opened to all finance areas
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Planned Post Implementation Training
• Information session
• Drop-in session will be run twice a day
• Normal help-desk support
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• THE END
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Cost Reconciliation of Capitalised Assets
• Lee Jnani
Outline
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Asset definition
Asset classes
Asset capitalisation procedure
Asset life cycle
Accounting system
Cost reconciliation business process
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Accounting Definition of Asset
AASB 116:
“Recognise the cost of an item or property, plant, equipment
as an asset if, and only if:
• It is probable that future economic benefits associated with
the item, beyond the year of purchase, will flow to the
entity; and
• The cost of the item can be measured reliably.”
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Asset Classes
Cash & Cash
Equivalents
Land, Building,
Infrastructure
Plant, Property
& Equipment
Intangibles
Financial Assets
Non Financial Assets
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PPE Asset Categories
Computer
Equipment
Research
Equipment
Teaching
Equipment
Motor
Vehicles
Musical
Equipment
Other
Equipment
PPE
Assets
Artworks
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Asset Recognition Threshold
Capitalised
Asset
Unit Price
(GST
exclusive)
>/= $5,000
NonCapitalised
Asset
Unit Price
(GST
exclusive)
<$5,000
Capitalised
as PPE in
Balance
Sheet
Expensed in
Income
Statement
Account 31xx
Account 51xx
Recorded in
Asset
Management
System
Recorded in
Portable &
Attractive
Register
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Life Cycle of A Capitalised Asset
Acquisition
• Purchasing
• Capitalisation
Retirement
Management
• Asset Disposal
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Depreciation
Asset Transfer
Cost adjustment
Re-classification
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Life Cycle of a Non-Capitalised Asset
Acquisition
- Expensed
Retirement
Management
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ESP Financials and Subsidiary Ledgers
Accounts
Payable
General
Ledger
Asset
Management
System
Accounts
Receivable
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How to Record Financial Events on Capitalised Assets?
– PeopleSoft (ESP FIN)
General
Ledger
(GL)
Asset
Management
System
(AMS)
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Purpose of Cost Reconciliation on
Capitalised Assets
• For Any Asset Class
• For Any Charging Code
Higher
Risk
GL
AMS
Accumulated
Depreciation
Accumulated
Depreciation
Cost
Cost
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P5 Asset Cost Reconciliation Shows…
GL
AMS
Variance
$293.5
mill
$288.7
mill
$4.8
mill
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Consequences of the Imbalance
GL
AMS
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How to Clear the Imbalance?
Summary by
Budget Unit
• Asset Class 1 – Variance 1
• Asset Class 2 – Variance 2
• Asset Class 3 – Variance 3
Detailed
Analysis by
Asset Class
• Charging Code A – Variance A
• Charging Code B – Variance B
• Charging Code C – Variance C
Task Table
• Recommended Actions
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ESP Version 9…
• Training programs
• Feedback welcome
• Acknowledgement
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Finance Forum
Afternoon Tea Break
Life After Finance & Business Services
• Melissa Orr
Journey from the dark side……
The story of one person’s life after F&BS into the
“real world”
F&BS positives
• Mentoring from CA/CPAs
• Exposure to University wide financial
transactions/processes
– Assets, SPF
• Understanding of importance of F&BS
deadlines and tasks
– FBT, AFS
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College benefits
• Working with other areas – HR, students,
research office
• You are the finance expert – your
Dean/GM rely on your advice
• Working with academics (a benefit?) but
makes life interesting
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The future
• For career advancement, consider all
finance positions – at F&BS, Colleges,
service divisions
• Get away from an “us and them” mentality
• Projects for finance professionals to work
together
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Recap of ARC Reporting
• Lorraine Piper
2011 ARC End-of-Year Reports
• Carry forward codes on Yes/No forms
• Written carry forward requests are an ARC
requirement
• ARC EOY 2011 Report
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2011 ARC End-of-Year Reports
• Maternity leave/reimbursement from LSL pool
for Fellowship holders
– LSL pool automatic 20 weeks @80% of salary only
– ARC claim 14 weeks @ ARC funded salary + 28%
oncosts
– Difference between 14 weeks ARC & 14 weeks LSL
pool funded amount will be calculated manually and
returned to LSL pool by journal (SPF team)
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2011 ARC End-of-Year Reports
• Salary Shortfall Calculations
– Issues with charging of superannuation on salary gap
for Laureates to original R code base pay source
– Accruals on split funding
– Manual journals required through the year or at end of
year
– On-line balance enquiry may be unreliable for
available funds determination
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2011 ARC End-of-Year Reports
• Deadlines
– ARC EOY reports are due to be submitted by
31 March each year – not changed in the
recent past
– Plan ahead: Written requests for carry forward
can be prepared in December before CIs take
leave
– Central Research Office reviews before
sending to ARC – they need time as well
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2011 ARC End-of-Year Reports
• Ineligible Expenditure
– Clean reports enable deadlines to be met
– Download a transaction listing using the ARC Fund Attributes
during Nov/Dec and journal out obvious ineligible expenditure
• Relocation Costs
– Maternity leave & relocation costs are no longer reported on the
End-of-Year reports. Claims must be submitted through the year
to the ARC through your Research Admin teams
– Time limit on when relocation costs can be claimed – action
claim quickly once reimbursement is paid to the academic
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2011 ARC End-of-Year Reports
• Transfers/Relinquishments during
January/February
– Calculation of figures cannot be done until after
effective date of transfer/relinquishment
– Encourage your Research Admin teams to notify SPF
early where possible: prior to preparation of 31
December statement so that any adjustments can be
incorporated into both statements
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QUESTIONS
?
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Living Away From Home Allowance
• Luke Beckett
Living Away From Home Allowance
• Rules regarding living away from home allowances are
changing.
• Government announced initial change in The Mid-Year
Economic and Fiscal Outlook (MYEFO).
• More details in the 2012/2013 Commonwealth Budget.
• Draft Legislation was released on 15 May 2012.
• Effect of changes is to limit tax exemption from 1 July 2012.
Living Away From Home Allowance
Existing Arrangements
1. Non-Residents
No longer tax free
from 1 July 2012
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Living Away From Home Allowance
Existing Arrangements
2. Residents
• Existing Arrangements will remain unaffected from 1 July 2012 and will cease
at latest 1 July 2014.
• Any changes to the arrangements (employment or LAFHA) will mean new
rules apply.
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Living Away From Home Allowance
• Changes
– Allowances paid to employees will be taxed as
ordinary income
– Deduction for accommodation and food will be
allowed against allowance
– Employees need to substantiate expenses
– Food amounts will need to be greater than $110
– Food amount below a limit (unknown) won’t need
to be substiated.
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Living Away From Home Allowance
• New LAFHA rules from 8 May 2012
– Applies to both residents and non-residents
– Must maintain 2 houses in Australia
– Maximum LAFHA deduction period of 12 months
at one site
– Taxable allowance will be subject to on-costs
(super, workers comp & payroll tax) for ANU
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Living Away From Home Allowance
• Not Changing
– Where the employer pays the expenses directly
or reimburses on a receipt, the amount will
remain a fringe benefit
– Requirements for an exempt benefit will be in line
with new allowance rules
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Questions
Contact: Luke Beckett
X58739
taxunit@anu.edu.au
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Project Updates
• Vanessa Quigley
Project Updates
Uniforum Benchmarking
Collaborative forum for Universities to benchmark their support services
cost and resourcing and understand the drivers of difference
ANU is participating with Uni Adelaide, Flinders Uni, Victoria Uni Wellington
and Uni of Otego with the Uni of Auckland sharing their data with us.
Data is from 1 January 2011 – 31 December 2011
Project Updates
Uniforum Benchmarking
– Staff Activity survey
• To be completed by Wed 5 June 2012
– Contractors analysis
• For completion by Fri 7 June 2012
– Scaling factors
• Completed
Project Updates
Accounts structure
A review of all accounts to better define how we capture information to
facilitate better reporting.
Includes
• Ledger codes (R, Q, S, T)
• School/Centre codes
• project codes
• business activities (teaching, research, admin)
• natural accounts
Project Updates
Accounts structure
• Developing a framework with defined rules for allocating account codes
• To be used to allow for both internal and external reporting requirements
• Looking at unique, consecutive codes for projects and centres, schools
with a hierarchy governed by mapped trees rather than trying to use
common linking numbers as done now.
• Trying to capture activities such as research and teaching without having
additional centres or natural accounts to capture the information
• Must interact with feeder systems and be consistent with other areas of
the University such as HR, stats and students
• Subject to greater discussion and will not happen overnight….but it will
happen
Project Updates
Reporting
• Enhanced reporting using TM1/Cognos including traffic light
reporting
• Suite of standard reports with consistent data at the high
and low level
• Adding to the work already done in iMIS
• Integrated reports, students, staff, finances
• More meaningful period reporting including using ARIES
data and recording out year encumbrances
Project Updates
Grant Budget Template
• To try to create a University wide tool to complete grant
budgets
• Modifications for specific funds providers integrated into the
one tool
• Advice on overheads being sought which will be integrated
• If you have tools in use I’m more than happy to steal your
good ideas!
Risk Management & Audit Office Reviews
• Yoon-Jin Park
• Internal Audit of Grant Management Framework
Preparation and Revision of Grant and Consultancy Budgets
• Pre-audit process
Development of Grant Income and Expenditure Monitoring
Process
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Internal Audit of Grant Management Framework
Introduction
• A review and evaluation of the body of work undertaken
through the internal audit program on the topic of grant
management framework to gain assurance of the ANU
compliance with grant sponsoring entities’ requirements.
• Three aspects of the framework which have not been covered
by internal audit and that have been given a medium residual
risk rating as follows:
– Grant budget preparation including overheads and in-kind contributions
during the pre-award grant application stage;
– Grant budget revision during the pre-award grant acceptance stage;
– Variations to grant/consultancy (e.g. budget or milestones) during the
post-award stage.
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Internal Audit of Grant Management Framework
The objectives and scope
• Evaluate procedures associated with the grant budget
preparation including overheads and in-kind contributions
during the pre-award grant application stage;
• Assess grant budget revision processes during the pre-award
grant acceptance stage; and
• Evaluate processes used to obtain variations to
grant/consultancy (e.g. budget or milestones) during the postaward stage.
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Internal Audit of Grant Management Framework
Next step
• A sample of grants and consultancies across all Colleges:
– Pre-award budget preparation including overheads and
cost of in-kind contribution;
– Pre-award grant acceptance revisions to budget per
sponsor communicated commitment; and
– Post-award variations to budget or milestones practices.
• Fieldwork to be commenced: June 18 2012
– Donna.Webster@anu.edu.au (6125 2505)
– Yoonjin.Park@anu.edu.au (6125 8365)
– Nguyen.Dang@anu.edu.au (6125 0961)
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Pre-audit Process
Introduction
• Purpose: To develop an adequate income and expenditure
(including payroll) monitoring process for Colleges and
Divisions that own grants/projects to be audited.
• Associated benefits:
– Better managed grants (e.g. budget monitoring and appropriateness of
expenses)
– Reduced workloads related to rework involved at the last minute
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Pre-audit Process
Next step
• RMAO is developing a descriptive monitoring process map for
a grant management framework in cooperation with the area
provided voluntary supports.
• Challenge: efficient and effective monitoring process
• Any input/comment and voluntary assistance
– Yoonjin.Park@anu.edu.au (6125 8365)
– Nguyen.Dang@anu.edu.au (6125 0961)
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Questions?
Next Finance Forum
27 August 2012
Finkel Lecture Theatre (Here)
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