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Copyright © 2012, Oracle and/or its affiliates. All rights reserved. Insert Information Protection Policy Classification from Slide 131

Improving Statewide Reporting & Performance Data Analysis: Success Stories

Keith Johnson, Director, State and Local Government, OracleRobert Sabo, Executive Director, Public Sector Solutions, OracleAlan Skelton, State Accounting Officer, Georgia


Welcome and Introductions

Moderator:R. Kinney PoynterExecutive Director

NASACT

Robert SaboExecutive Director

Public Sector SolutionsOracle

Keith JohnsonDirector

State and Local GovernmentOracle

Alan SkeltonState Accounting Officer

Georgia


Intentionally Left Blank


Program Agenda

Welcome and Introductions

Public Sector Challenges

Shifting Gears: Manual to Automatic – Statewide

Financial Reporting and Performance Data Analysis

State of Georgia Success Story

Questions and Answers


Public Sector Challenges

Keith JohnsonDirector, State and Local Government Oracle


The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions. The development, release, and timing of any features or functionality described for Oracle’s products remains at the sole discretion of Oracle.


Things are changing!

“The picture is pretty bleak, gentlemen….The world’s climate

Is changing, the mammals are taking over, and we all have a brain

about the size of a walnut.”



Economic/budget crisis– Fewer resources – same or

bigger job

Internet savvy citizens demand more

– Demand “commercial” like access to government

Demands for transparency– What is my government

doing?



Demands for Efficiency– Performance Management

– How well is my government doing its job?

New Regulations– GASB, Federal, Bond Agencies

– Faster, more frequent reporting ( CAFR other)

– Federal Data Act

New technology options– Cloud – Next Gen Web – Social

Networking


DATA – Digital Accountability and Transparency Act

What does it do?

Point Point

Creates Federal Accountability & Spending

Transparency Commission (FAST)

Requires recipients of federal fundsto report use of funds at least

quarterly to FAST

Requires single electronic platform to track federal spending

Amends FFATA - Federal Funding Accountability and Transparency

Act

What is it? Bi-partisan support in both House

and Senate

Purpose: Accountability andtransparency in federal spending,

including grants

Similar to ARRA reportingbut significantly expanded

In Process– Last hearing wasJuly 17,2012


SEC Report on Municipal Market

Report issued July 31, 2012 Recommendations

– SEC would set issuer disclosure requirements

– SEC would establish form and content of financial statements

– SEC would enforce compliance with continuing disclosure obligations


More cost effective delivery of services

A higher quality and level of services to citizens

Greater focus on outcomes and results

Effective use of personnel and technology

Deliver High Performance

What Must Government Do?


Provide financial and other information faster

Deliver more and better usable information to citizens, elected officials and all stakeholders

Use technology and data to support better decisions

Provide Insight and Transparency

What Must Government Do?


What can a high performance system do for your organization? – Reporting

Manage complex consolidation of organization/component units reports

• Eliminate multiple spreadsheets

• Provide detail audit trail to source entries

• CAFR, Budget Statement and other report book creation

• Streamline entire CAFR process

• Integrated to Desktop


What can a high performance system do for your organization? – Budgeting and Planning

Provide detailed control over the entire process– Workflow

– Approval Rules

– Configurable forms

– Role Based Security

– Decision Packages

Analytic Capabilities– Multi year forecasts using complex formulas

– Real-time budget and scenario analysis

– Complex compensation modeling


What can a high performance system do for your organization? – Performance Management

Support Performance Based Budgeting Models– Goal Setting

– Tie budget and expenditures to targets

– Manage action


Summary

Things are changing – having to do more with less

Performance management (Transparency, Accountability and Timeliness) is at the forefront

Public Sector entities can successfully address these issues


Financial Reporting Survey Results and Solution Overview

Bob SaboExecutive Director, Public Sector Solutions, Oracle

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Topics

• Survey Findings• Beyond ERP• Transparency• Enterprise Performance Management and Financial

Reporting

20

Survey Results24 States Responded

Self Grade - Ability to deliver timely, useful financial reports to management

71% - budget reductions have had an impact on their ability to support financial reporting requirements and demand.

21

Survey Results - Timing

•75 percent of the states note that it takes four to six months to complete and finalize the CAFR

•None of the states surveyed can complete the report in three months or less.

•However, two thirds of states note that they would like to complete and finalize the CAFR in fewer than 120 days.

Is the bottleneck component units? Systems? Necessity?

22

Survey Results – Efficiency

33 % - CAFR process is extremely or somewhat inefficient

4% - four percent say that CAFR generation is completely automated.

71% - percent of the states noted that 25 percent to 50 percent of their financial staff’s time is spent on moving data or maintaining in-house developed routines to support the financial consolidation and reporting process.

States are acting!

23

Survey Results – Data Analysis

25% - Of states surveyed note that inefficient manual processes pose the biggest challenge for analyzing data

25% - Not able to gain sufficient insight from their data and make use of it to drive actions or contribute to overall performance improvements

21% - Say their challenges divert time, money and resources from citizen programs or make it difficult to get timely information to managers who make decisions about funding and planning for these programs

24

Charting a Path

• Examine current processes – define and develop organization-wide priorities and strategies that include information architecture and transition timelines

• Evaluate technology options – choose flexible financial management technology tools that enable states to start small and add new functionality when they need it

• Open doors – select open, standards-based solutions that enable integration between disparate systems and data sources

• Think analytically – invest in business intelligence solutions that provide financial managers with the timely information they need to make more effective decisions

• Partner for success – work with trusted technology providers that can help define information management strategies and architecture requirements to capture, secure, analyze, use and share data effectively and in real-time across the organization

25

Topics


Reporting

26

100% Custom – Fortran/Cobol – Punch Cards, COTS? ERP? What’sThat?

A Brief History of Business Applications

1970’s

1980’s

1990’s

2000’s…

Internal (MIS only) – Mysterious peopleIn cold rooms behind closed doors.Mainframe rules.

First COTS/ERP Apps (GL/AP) but still mostly custom – End user terminals (green screen) appear

Internal (MIS with some end useraccess.) Mainframe still rules but Mid range (and yes the PC) appears.

ERP grows – Many more applications – PC/Client Server gives birth to “Super User”COTS takes the lead. Y2k a major driver

Departmental – MIS no longer rules. Business users gain. StillInternally focused to organization

Internet changes everything –Tremendous productivity gains/cost savings. Data for analysis, not just recordkeeping. Transparency is a major requirement.

External Focus – Move outsideOrganization. Citizens, clients,vendors have access

FOCUS

27

COTS – Commercial Off the Shelf Software

Systems Issues

• Old custom systems still around– UI systems average 22 years old

(NASWA)– MMIS, Tax, some ERP 10+ years

old

• Even 10 year old system not architected for external access

• Expensive to maintain• Nearly Impossible to upgrade

• Excel• Budgeting• Fed/Special Reporting• CAFR

• Multiple versions of the truth• Hidden effort is still costly• Multiple data handoffs• Audit issues

Vendors and customers have moved aggressively to replace

Custom applications with Off the Shelf ones!

28

Topics


Reporting

29

• Performance Management ensures public funds are effectively used

• Budgeting and Planning provides control and insight

• Reporting provides accurate and timely feedback.

Elements of Public Transparency

Solutions

Reporting

Public Transparency

Performance

Management

Budgeting and Planning

30

Transparency• Groundswell– All 50 states have transparency sites– Quality/comprehensiveness varies

Following the Money 2011 – US Public Interest Research Group

2011 PIRG

ReportOnline Access to Government

Spending Data

31

Transparency• Major Changes in Grades 2010 to 2012


2012 PIRG

Report

Online Access to Government Spending Data

32

Transparency


• Major Changes in Grades 2010 to 2012

33

Define Transparency?

http://sunshinereview.org/core/

•10 Criteria

•Goal – More than exposure

•Ratings for States, Cities, Counties, K12

Oracle Whitepaper:

Transparency in the Public Sector:

Its Importance and How Oracle Supports

Governments Efforts

34

• PeopleSoft ERP, Business Intelligence

• Award winning “A” rated transparency website

• Direct data update to website from source

• Wide range of public information

Solutions

Transparency Case Study Example State of Indiana

35

Transparency Case Study Example State of Indiana

Contract Search

36


37

Topics

• Survey Findings• Beyond ERP• Transparency• Enterprise Performance Management and

Financial Reporting

38

Local Government Technology Priorities

Center for Digital Government – State and Local IT Trends 2012

Performance management and reporting

Transparency

ERP – Replacement, implementation, extension and upgrades

Legacy Modernization – ERP and Tax Systems

Document/Records Management and content management and workflow

39

Oracle EPM Overview

• Automates and links strategic/financial management processes

• Modular and integrated

• Integrates data from multiple transaction systems

• Fast time to value; Low TCO

Integrated Performance Management Suite

Oracle BI Foundation

Common Information Model

Performance Management

Financial Close & Reporting

Budget Formulation & Execution

Revenue Analysis &Cost

Management

Tax & Revenue

Case Management

Operational Systems

Student Systems

4040

Performance Management ApplicationsIntegrated Suite of Best-of-Breed Modules

Integrated Agency Planning

Financial Reporting & ComplianceCost Management

Performance Scorecard

Revenue Analysis and Cost Management

• Clearly articulate strategy & goals, communicate them across the enterprise

• Develop scorecards leveraging recognized methodologies and industry benchmarks

• Ensure accurate forecasts, shorten budgeting & planning cycles, and model the potential impact of workforce & capital spending decisions

• Conduct cost analysis using robust modeling and analysis with integrated drill down

• Visibility into cost and revenue drivers through traceability maps

• Close and report financial results, meet regulatory requirements, reduce compliance costs and improve confidence in the numbers

Strategy Management

Strategic Finance

Capital Expense Planning

Public Sector Budgeting and Planning

Financial Data Quality Management

Financial Management

4141

Hyperion Financial ManagementAccelerates Reporting Cycles and Reduces Costs of Compliance

• Patented financial consolidation and reporting features

• Complete audit trails, workflow and validations

• “Smart Dimensionality” • Flexible “what if” scenario

management features• Powerful, reporting and analysis

tools• Full integration with ERP and

other transaction systems • Easy to customize and extend• Web-architected

4242

Reliable Financial ReportingImprove Timeliness and Usefulness of Information

Daily Monthly QuarterlyQuarterly YearlyYearly

• Rapidly Aggregate Financial Information Across Different Entities

• Provide Visibility Across All Department / Management Levels

• Ensure Role-Based Securityat Every Level

• Internal Reporting for Operational Management and Improvement

• External Reporting for Submission to Overseeing Agencies

Departments

Agencies

Budget Officers

Program Managers / Officers

<Insert Picture Here>

4444

Link Hyperion to Source ApplicationsHyperion Financial Management/Planning

Oracle Account Analysis and Drill-Down

Hyperion Financial Data Quality Management

EPM System

Release 11

4545

Visual Flow of Calculation

EPM Calculation ManagerUnified Environment for EPM Business Rules

4646

Oracle Hyperion Strategic FinanceStrategic Agency Funding & Out-Year Financial Modeling

• Define Funding Options• Link Priorities to

Out-Year needs• Analyze trail feature• Freestyle reporting• “What If” analysis toolkit

4747

Taking Simulation to the Next Level:Understanding Risk and Uncertainty

1.Model– Specify the range of input

assumptions– Simulate possible outcomes

(Monte Carlo)

2.Quantify– Range and likelihood of outcomes– Relative importance of input

assumptions

3.Decide– Focus on what matters– Prioritize the outcomes by balancing

risk and reward

48

Decision Workflows – Financial Analytics

• Business Function Finance / Budget

• Role Director – FinanceManager - Department

• Objectives– Monitor budget

utilization– Control risk of

payables portfolioTarget procurement efforts for more

effective spending

Drill toinvoice detail

Which payables itemsare involved?

Is it based onsupplier spend?

Which departmentsare accountable?

Are expenses on target?

Execute to Budget Plan

Drill toHR Analytics

When were theexpenses incurred?

Is it based on overtimecompensation?

Is revenue on target?

BusinessObjectives/

Issues

GainInsights

TakeAction

49

Decision Workflows – Financial Analytics

Target procurement efforts for more

effective spending

Is it based onsupplier spend?

Execute to Budget Plan

Drill toDetailBusiness

Objectives/Issues

GainInsights

TakeAction

Who are the suppliers?

Drill toinvoice detail

Which departmentsare accountable?

Are expenses on target?

5050

Selected Oracle EPM State & Local Government Customers

Copyright © 2007, Oracle. All rights reserved.

Hyperion in GeorgiaAugust 13, 2012

Page 52

Agenda

► History of Reporting in Georgia► Hyperion Financial Management (HFM)

Overview Benefits

► Project Highlights► Overview of HFM

Hyperion Dimensions Data Loads Rules Financial Reporting Sample Reports

► Q&A

Page 53

History of Reporting

► Georgia produces 5 main financial reports annually Comprehensive Annual Financial Report (CAFR) Budgetary Compliance Report (BCR) Selected Summary Financial Information (Treasury

Operations) Single Audit Report (SAR*) Section 1512 Reporting (produced quarterly) (ARRA*)

• For FY2010 & FY2011 reporting Hyperion was used for the CAFR, BCR and Treasury Operations. SAR and ARRA have not been migrated to Hyperion.

Page 54

History of Reporting

► 50 organizations are reported in the BCR ► Approximately 350 trial balances (comprised of ~130

organizations) are reported in the CAFR ~ 45 of the organizations reported in the CAFR are on a

common ledger system (PeopleSoft).

► PeopleSoft primarily maintains ledgers on a statutory (budget) basis and is converted to GAAP reporting is collected through year-end forms. SAO utilizes the data on the year-end forms and other

sources to post conversion entries in HFM. Data is also gathered from CPA audited financial

statements for some organizations included in the CAFR.

Page 55

Challenges with Legacy System

► Time CAFR and BCR were not consistently being issued by required

12/31 deadline

► Cost Create separate import files for each organization Manually map each line of T/B to the applicable reporting line Consolidation of various reporting levels could take hours and the

system (Caseware) often crashed prior to completion. Manually enter information collected in year-end forms to

consolidate and prepare the notes Manually close out revenue/expense

► Quality Difficult to analyze data across funds (i.e., cash for a single entity)

Page 56

Solution: Hyperion

► Web based application Accessible by users in multiple locations

► State Owned and Operated SAO owns both the results and the system Minimal to no IT support required

► Packaged Application Out-of-the-box financial intelligence – minimal ongoing

consulting

► Drill-back capability Allows for drill-back to source system data Microsoft Office Add-In (SmartView) Allows users to retrieve data from and submit data to Excel

Page 57

Solution:Hyperion Financial Management (HFM)

Page 58

Benefits of HFM

► Reduce cycle time Automate data load for agencies using statewide accounting

system (PeopleSoft) with the use of FDM Automate journal entries, where possible Ability to post journal entries across multiple agencies

Allocation of investment pool holdings Remove encumbrances in conversion from Budget Fund to General

Fund Lease and capital asset / accumulated depreciation entries

Data forms and Excel SmartView spreadsheet upload tools allow for input of additional data Trial balance for non-PeopleSoft users loaded via SmartView Supplemental data used for the NTFS (i.e., Capital Asset changes

and debt service to maturity details)

Page 59

Benefits of HFM

► Improve Quality Standardized mapping for common G/L users and ability to

load data in a single upload file Reduced load time provides additional time to analyze data Data can be reviewed across organizations and fund types

from a single system Ability to more efficiently analyze year over year trends and

provide support for MD&A analysis

► Flexibility Easy to create and modify excel files to retrieve data from

HFM using SmartView No limit to the number of Excel SmartView files

Page 60

Project Highlights

► Entire timeline took less than 6 months to complete Used a consulting firm to assist with application setup

► SmartView functionality made it easy to convert write-up files from prior system to Hyperion links

► Created rules in HFM thereby reducing the number of AJEs required

► Created supplemental data accounts to track dates received and applicability status of year-end forms

► Utilized an Excel JE template to upload journals to HFM (maximum of 5K lines long)

Page 61

Reporting

► Examples of Reports in FASTR/SmartView Trial Balance BCR and CAFR Statements Journal Entry Report

► Hyperion Financial Reporting Studio report template will be created to support report production

Page 62

Sample BCR (SmartView version)

Page 63

Sample CAFR (SmartView version)

Page 64

Test Case

► Day before CAFR is to be released Material Error to Beginning Capital Asset amount for

Discretely Presented Component Unit

► What do I need to do? Enter AJE Enter Supplemental Data Consolidate Data Click “Refresh” with Smartview files and statements, NTFS,

MD&A, check files, and analytics

► Done!► All changes are done

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Additional Resources

• Report: Shifting Gears: Manual to Automatic- Statewide Financial Reporting and Performance Data Analysis

• On Demand Webcast: Reduce the Time, Cost and Complexity of Financial Report

• Resource Center: Public Sector Enterprise Performance Management*

*Note: To access the Resource Center, Enter one of the following case sensitive tokens: Federal: FEDQ22013 or State & Local: SLQ22013

66

Questions?

Moderator:R. Kinney PoynterExecutive Director

NASACT

Robert SaboExecutive Director

Public Sector SolutionsOracle

Keith JohnsonDirector

State and Local GovernmentOracle

Alan SkeltonState Accounting Officer

Georgia

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