Procure to Pay Fundamentals

Record to report process

General LedgerMINISTRY OF FINANCE

IFMIS RE-ENGINEERING

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Table of Contents

1.0 IFMIS Financial Management Operating Model 1.1 Overview of Record to Report 7 1.2 Record-to-Report Overall Process 8 1.3 Record to Report at a Glance 9 2.0 What is Oracle General Ledger? 2.1 Recording Flow 13 2.2 Reporting Flow 14

3.0 What is a Ledger in Oracle GL 3.1 The 4 Cs 16 3.2 Ledger 17 3.3 Accounting Setup Manager 18 3.4 Sub-ledger Accounting 19 3.5 Multi-Org Access Control 21

4.0 Record Transaction Overview 4.1 Record Transactions To-Be Process Flow26 4.2 Record Transactions Activity Descriptions 25 4.3 Record Transactions Key Inputs and Outputs 26 4.4 Other Considerations for the Record Transactions Process27

5.0 Understanding Sources and Categories 5.1 Journal Sources: 28 5.2 Journal categories: 28

6.0 Create Journals 6.1 Automated Journals From Payables 31 6.2 Create Manual Journal Journal Batch 35 6.3 Journal Creation : Reverse Journals 39 6.4 Journal Posting 40

Table of Contents

7.0 Perform Inter-Agency Accounting Overview 7.1 Perform Inter-Agency Accounting To be Process Flow50 7.2 Record to Report Level 2 Perform Inter-Agency Accounting Flow51 7.3 Perform Inter-Agency Accounting Key Inputs and Outputs54 7.4 Other Considerations for the Perform Inter-Agency Accounting Process55

8.0 Manage Interfaces Overview8.1 GL Interface Flow 59 8.2 Manage Interfaces To be Process Flow 608.3 Manage Interfaces Activity Descriptions 61 8.4 Manage Interfaces Key Inputs and Outputs 62 8.5 Other Considerations for the Manage Interfaces Process 63

9.0 Analyze & Reconcile Accounts Overview 9.1 Analyze and Reconcile Accounts Process Flow 65 9.2 Analyze and Reconcile Accounts Process Flow 669.3 Analyze and Reconcile Accounts Activity Descriptions 67 9.4 Analyze and Reconcile Accounts Inputs and Outputs 68

Table of Contents

10.0Online Account Inquiry 10.1 Online Account Inquiry Drilldown 74 10.2 Reporting in GL Standard Reports 77 10.3 Submit Standard Report flow 79

11.0 Close Books and Consolidate Financial Results Overview11.1 Close Books and Consolidate Financial Results Process Flow 81 11.2 Close Books and Consolidate Financial Results Activity Descriptions8211.3 Close Books and Consolidate Financial Results Key Inputs and Outputs 8411.4 Other Considerations for the Close Books and Consolidate Financial 85 12.0 GL Period Close 12.1 Close the Sub ledgers 87 12.2 Period Statuses 88 12.3 Close GL Period 89

Table of Contents

13.0 Perform Financial and Regulatory Reporting Overview 13.1 Perform Financial and Regulatory Reporting Process Flow 91 13.2 Perform Financial and Regulatory Reporting Activity Description 92 13.3 Perform Financial and Regulatory Reporting Key Inputs and Outputs 93 13.4 Other Considerations for the Perform Financial and Process 94 14 Overview of FSGs 14.1 Run an FSG Report 96

15 Perform Management Reporting Overview 15.1 Perform Management Reporting To-Be Process Flow 98 15.2 Perform Management Reporting Activity Descriptions 99 15.3 Perform Management Reporting Key Inputs and Outputs 100 15.4 Other Considerations for the Perform Financial and Regulatory 101 Reporting Process

16. Proposed New Char of Accounts 102

Table of Contents

Table of Figures

Figure ILedger 20Figure II Accounting Setup Manager 22Figure IIISub-ledger Accounting 24Figure IVMulti-Org Access Control 26Figure VAutomated Journals From Payables 35Figure VI Automated Journals From Payables 37Figure VIIAutomated Journals From Payables 38Figure VIII Create Manual Journal Batch 39Figure XI Create Manual Journal Batch 40Figure XCreate Manual Journal Header 41Figure XI Create Manual Journal Lines 42Figure XII Journal posting-Window 45Figure XIII Journal Posting- Automatic 46Figure XIVJournal Entry- Header 47Figure XVExchequer Journal Entry Lines 48Table of FiguresFigure XVI Exchequer Journal-Receipt 49Figure XVII Imprest Journal 50Figure XVIII Salaries Journal 51 Figure XIX Agency Transactions Journal-Principal 59Figure XX Agency Transactions Journal-Agent 60Figure XXI Agency Transactions Journal-Surrender 61Figure XXIISummary Account-Online Inquiry 73Figure XXIII Summary Account-Online Inquiry 74Figure XXIV Online Account Inquiry 76Figure XXV Online Account Inquiry 77Figure XXVISubmit Report Flow 81Figure XXVIIRun an FSG Report 97

List of AbbreviationsA-I-AAppropriation in AidAIEAuthority to Incur ExpenditureAPAccounts PayableAWPAnnual Work PlansBD Budgeting Supplies DepartmentBPGBudget Procedural GroupBPRBusiness Process Re-EngineeringBPSBudget Policy StatementBSCBudget Steering CommitteeBSPBudget Strategy PaperCBK Central Bank of KenyaCMMCash Management ModuleCoAChart of AccountsEFTElectronic Funds TransferERDExternal Resources DepartmentEXUExchequer UnitGL General LedgerGoKGovernment of KenyaGPAYGovernment Payment SystemICT Information, Communication and Technology IFMISIntegrated Financial Management Information System

List of AbbreviationsIPPD Integrated Personal Payroll DataKRAKenya Revenue AuthorityMDGMillennium Development GoalsMoFMinistry of FinanceMPERMinisterial Public Expenditure ReviewsMTCMinisterial Tender CommitteeMTEFMedium Term Expenditure FrameworkP2BPlan to BudgetP2PProcure to PayPBBProgramme Based BudgetingPFMPublic Financial ManagementPO Purchase OrderPPOAPublic Procurement Oversight AuthorityPRPurchase RequisitionPSPermanent SecretaryR2CRevenue to CashR2RRecord to ReportRFPRequest For ProposalRFQRequest For QuotationVATValue added Tax

IFMIS Financial Management Operating Model11Overview of Record to ReportRecord to Report is an end to end process which underpins Plan to budget, Revenue to Cash, and Procure to Pay, as it provides a structure for recording transactional data effectively, processing that data right through to the production of regulatory, financial and management reports. It begins with the collection of source transactions and other accounting data and ends with the creation of reports. It encompasses the majority of activities typically referred to as general accounting and encompasses the following Level 2 processes:

12Record-to-Report Overall Process

13Record to Report at a GlancePURCHASINGPAYABLESRECEIVABLES

Transfer To GeneralLedgerJOURNALSPOSTINGREPORTINGASSETSCASHMANAGEMENTREVIEWAsset AdditionDepreciationReceipt AccrualsSupplier InvoicesPaymentsCustomer InvoicesReceiptsReconciliationBank ChargesFollowing are the key processes as part of Record to Report cycle that occur in General ledgerRecord and Review Accounting InformationImport data from subsidiary ledgers, or enter journals to record actual or budget transactions directly into Oracle General Ledger.Enter encumbrance journals to track encumbrances through the purchase process and to control spending against budgeted amounts.Review account balances online or through reports.

Process Accounting Information Revise actual, budget, and encumbrance information.Revalue and translate balances denominated in foreign currencies.Consolidate balances from multiple set of books.Alternate representation of currencies to meet statutory requirements

Analyze Accounting InformationIntegrate Oracle General Ledger with Third Party systems like Data warehouse, Essbase etc to simplify the reporting, budgeting and forecasting process.Internal and External reporting using various tools like FSGQuickly prepare what if analyses and pro forma reports using the GL data

14What is Oracle General Ledger?A Big Bucket, where most financial transactions end up!A book of final entry, summarising all of a companys financial transactions

Oracle General Ledger facilitates the following tasks:

Financial controls

Data collection

Information access

Financial reporting and analysis

15Recording FlowPURCHASINGPAYABLESRECEIVABLES

Transfer To GeneralLedgerASSETSCASHMANAGEMENT

Journal BatchesJournal HeaderJournal LinesGL_INTERFACEJournalImportSPREADSHEETEXTERNALSOURCESRecording Flow

Each individual sub ledger application capture source transactions and upon validation converts them into appropriate accounting entry. Transfer to General Ledger process is a common interface program across all sub ledger application which includes fixed assets, purchasing, payables, receivables, and cash management.

Accounting transactions can also be captured from Spreadsheets and External non-oracle sources.

All the sub ledgers, spreadsheets and external sources populate the data in GL INTERFACE and General Ledger pulls the data in to General Ledger by running a batch process named Journal Import. Journal import created Journal Batches in General Ledger. Batches have multiple journals and each journal can have one or many lines.16Reporting FlowPOSTEDBALANCES

OnlineInquiry

StandardReports

FSGReportsChoose AppropriateReportingOptions Reporting Flow

Oracle General Ledger provides a wide variety of reporting options. Depending on the reporting need of the organization, you can choose appropriate tools to suffice the objectives.

Online Inquiry is an option to make ad-hoc instance query to check balance in a particular account for period and drill down to source transactions.

Standard reports are ready to use reports provided by standard application and it can help extract trial balance, account analysis etc.

FSG Reports are custom developed specific to needs of the customer.The tool provided for the same is called Financial Statement Generator (FSG)

17What is a Ledger in Oracle GL

CalendarChart ofAccountsCurrencyA ledger represents the core of a company`s records where every transaction flows.

4 Cs

Ledger

The 4 Cs form the Set of BooksChart of AccountsCalendarCurrencyAccounting Setup Method2. A ledger represents the core of a company`s records where every transaction flows.18In R12 there is Introduction of 4 Cs (Chart of Accounts, Calendar, Currency, Accounting Method ) in comparison to 3 Cs in R11i

The purpose of introducing the Accounting Method is to assign different accounting methods to different ledgers.

You can have multiple ledgers with multiple accounting methods for the reporting requirements. For Government of Kenya (IFMIS) there is a Single Ledger which is being assigned Standard Accrual Accounting Method.

The 4 Cs R11i Set of Books is being replaced by Ledger in R12i

Defining of the Ledger is now centralized

You can define single or multiple ledgers.

Multiple Legal Entitles can be defined to a Single Ledger.

Different ledgers can have different accounting methods as per statutory reporting requirements.

You can map Legal Entity to Balancing Segment within a Ledger.

For Government of Kenya (IFMIS) there is only one Single Ledger called Government of Kenya.

Ledger

LedgerFig i LedgerLedger21 With Accounting Setup Manager you can define and maintain the following from a centralized Page.

* Ledger. * Legal Entities.* Reporting Currencies .* Intercompany Accounts and Balancing Rules.* Accounting Method.* Balancing Segments assigned to Legal Entities.* Operating Unit assigned to Ledgers.

Accounting Setup Manager

Accounting Setup ManagerFig ii Accounting Setup ManagerAccounting Setup Manager:

Click the Update Accounting Option icon and view Legal Entities, Ledger, Currencies and Operating units ,23 Sub-ledger Accounting is not a module but a process.

In 11i the data flows directly from Sub-Ledger modules (like AP and AR) to General Ledger.

In R12 the data flows from Sub-Ledger modules like (AP,AR) to Subledger Accounting and then it moves to General Ledger Module.

The accounting entries are first created in Subledger Accounting, validated and then moved to General Ledger.

This is complete seeded automated process where user intervention is not required.

Subledger Accounting

Sub-ledger Accounting Fig iii Sub-Ledger AccountingSub-Ledger Accounting Method25In11i the Super User needs to switch responsibility to access multiple organizations data.

In R12, with the introduction of Multi-Org Access Control feature, there is no need to switch responsibility to access multiple organizations data.

You can enter, process data and generate reports from single responsibility.

Multi-Org Access Control can be assigned to specific responsibilities.

Multi-Org Access Control

Multi-Org Access ControlFig iv Multi-Org Access ControlMulti-Org Access Control:

Without changing responsibility we can change the operating unit.27Record Transaction OverviewThe Record Transactions Level 2 process deals with creating, approving, and posting transactions (manual, automated, recurring, ad-hoc, etc.) to the ledger. This process may be triggered by different roles/departments dependent on the journal voucher type.This section describes the process for posting JVs to the GL from (i) within IFMIS e.g. Purchase Orders and (ii) from external systems integrated with IFMIS e.g. HRM PPDS module for salary vouchers.

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Record Transactions To-Be Process Flow

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Record Transactions Activity Descriptions

ActivityActivity DescriptionManual/System SupportedOrganisational RoleSend Data to Accounts(Start Process)NB 1A is relevant for data received from within IFMISAccounts Receive Data from integrated IFMIS module (e.g. A/P)AutomatedSource System Department e.g. ProcurementSend Data to Accounts(Start Process)NB 1B is relevant for data received from an external system integrated with IFMISAccounts Receive Data from Input System (e.g. HR salaries) Data is transmitted electronically from a non-IFMIS system to the GL via system interface. AutomatedSystem InterfaceSource System Department e.g. HR Process Automated JVsProcess automated journal vouchers in the GLAutomatedAccountingReview and Approve Automated JVsReview and approve journal vouchers posted automatically to the general ledger against any scanned documentation received from non-IFMIS systemSystem SupportedManually Reviewed but Approved on SystemAccountingPayment Process(End Point)Payment process triggered dependent on payment method:Electronic payment via CBKCash Payment Manual and System (dependent on payment method) Accounting 30

Record Transactions Key Inputs and Outputs

InputProcessOutputOnline Policy / Procedure ManualThreshold for JV approvalStandard Journal Voucher TemplateCreate & Submit JV in GL Electronic Journal Voucher RequestElectronic Journal VouchersReview and Approve Automated EntriesAutomated JV Processed in GLElectronic notification to requestor31Other Considerations for the Record Transactions ProcessThe following considerations should be taken into account in the detailed system design and implementation of this agreed Level 2 process:

* Journal vouchers should be processed to the general ledger through a standardized, controlled, timely process with the appropriate supporting documentation. * Journals can be entered and posted to the ledger throughout the month (real-time posting).* Tolerance settings should be considered in order to limit the journal amount a user can post without approval.* Journal documents that have been posted to the ledger can be reversed in their entity.

32Understanding Sources and CategoriesJournal Sources:

* Defines from where the journal entry was created e.g. Manual, or Payables

* Oracle General Ledger comes seeded with many predefined Journal sources

* Additional sources are useful for manual journal entry or for automatic interfaces that may be built

Journal categories:

* Signifies the type of journal entry, e.g. Respective Ministry followed by Adjustment

* Oracle General Ledger comes seeded with many predefined Journal categories

* Optionally, user defined categories could be useful

Apart from the seeded Journal Sources as provided by Oracle Applications, additional Sources and Categories can be defined to distinguish various journals as may be transferred/created from external Systems.33Create JournalsIdentify Method of entryEntering Journals / Importing JournalsReview /Approve JournalsPost JournalsEnter or Import Define and generate recurring, reversing, and Allocations Upload, and import ADI journalsMethods include Manual Recurring Reversing AllocationsADI Review unposted journals for accuracyCorrect Journals as requiredPost journals from the Journals, Post Journals, or Auto Post formsFollowing are the basic Journal entry types in Oracle General Ledger:Manual Journal Entry Basic Journal Entry type is used for most accounting transactions. Examples include GAAP Adjustments, ProABCs, AccrualsImported Journal Entries Imported Journals are created by importing journals from Oracle sub ledgers or third party systems using the standard journal import functionality of Oracle General Ledger Eg. Journals created from Oracle Payables sub ledgerRecurring Journal Entries Recurring Journal entries are defined once and then repeated for each subsequent period. Mass Allocations - MassAllocations are journal entries that utilize a single journal entry formula to allocate balances across a group of cost centers, departments, diABCs or other segments. Eg Allocate Rent on the basis of square feet usedReversing Journal feature Reversing Journal are created by reversing an existing journal entry. Any Journal entry can be reversed and posted to current or future accounting period. Journals can be manually reversed or can be scheduled for auto reversal Eg. Revaluation Journals are normally automatically marked for reversals in next period

34Automated Journals From Payables

Fig v Automated journals From APTo submit Payable Transfer Programe From Payables ,

Navigation is View->Request35Automated Journals From Payables

Fig vi Automated JournalsClick on Submit a New Request 36Automated Journals From Payables

Fig vii Automated JournalsClick on Ok. (its a single request).37Automated Journals From Payables

Fig viii Automated JournalsSelect:( Payables Transfer To GL)Then Click on the Submit Button.38Create Manual Journal Journal Batch

Fig ix Create Manual Journal- BatchNavigate to the Journals creation screen using the General Ledger responsibilityNavigate to the Enter Journals window.Enter or query the batch for which you are entering journals. To enter a journal without entering batch information, choose New Journal and proceed to Step 4. - To enter journals for a new batch, choose New Batch and enter the batch information.To add journals to an existing batch, query the batch and choose Review Batch. Journals can be added to an existing batch only if the batch is not postedChoose Journals.

Enter a unique Journal name for the entry. If you do not enter a journal name, General Ledger automatically assigns a name using the following format: Source Journal ID Date. Journals should be named according to the nature of the journal lines to be booked in the concerned Journal.

Enter the Period for the journal entry. If you entered a period at the batch level, you must use the same period for each journal entry in the batch. If you did not enter the journal from the Batch Form, choose any Open or Future Enterable period for your journal entry. Note that you can only post journals in Open periods.

Accept or change the default Effective Date for the journal entry.

Enter a Category to describe the purpose of your journal entry. All lines in a journal entry share the same journal category. Please note that the Journal Category can not be changed once the Transaction is savedEnter Description for the journal entry. General Ledger uses this as the default description for each journal entry line. You can change the journal entry description as necessary.

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Create Manual Journal Journal BatchFig x Create Manual Journal -BatchClick on Journals button to capture a new journal. Enter a Control Total if you want to verify the total debits for the journal lines against the journal control total.

Accept the default Currency (the functional currency for your Ledger), or change the journal currency to enter a foreign currency or statistical journal.

Where a Foreign Currency Journal has to be entered, chose an appropriate currency. Select the Date whose exchange rate has to be applied for the Transaction.

Select the Rate Type as Corporate (the Book Keeping Rate). The Corporate rate for the selected date would default. Where required the other Rate types of User can be used.

Choose More Details to enter optional reference information about the journal entry.

The Reference field would contain the External Reference information for transactions imported from external systems and populated while transfer from other system. This could be left blank for manual journals.

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Create Manual Journals Enter Journal HeaderFig xi Create Manual JournalNavigate to the Journals creation screen using the General Ledger responsibilityNavigate to the Enter Journals window.Enter or query the batch for which you are entering journals. To enter a journal without entering batch information, choose New Journal and proceed to Step 4. - To enter journals for a new batch, choose New Batch and enter the batch information.To add journals to an existing batch, query the batch and choose Review Batch. Journals can be added to an existing batch only if the batch is not posted5. To capture line details, click on the lines tab and to view the change in status, click the other information tab on the journal header.Choose Journals.

Enter a unique Journal name for the entry. If you do not enter a journal name, General Ledger automatically assigns a name using the following format: Source Journal ID Date. Journals should be named according to the nature of the journal lines to be booked in the concerned Journal.

Enter the Period for the journal entry. If you entered a period at the batch level, you must use the same period for each journal entry in the batch. If you did not enter the journal from the Batch Form, choose any Open or Future Enterable period for your journal entry. Note that you can only post journals in Open periods.

Accept or change the default Effective Date for the journal entry.

Enter a Category to describe the purpose of your journal entry. All lines in a journal entry share the same journal category. Please note that the Journal Category can not be changed once the Transaction is savedEnter Description for the journal entry. General Ledger uses this as the default description for each journal entry line. You can change the journal entry description as necessary.

Enter a Control Total if you want to verify the total debits for the journal lines against the journal control total.

Accept the default Currency (the functional currency for your set of books), or change the journal currency to enter a foreign currency or statistical journal. 41

Create Manual Journals Enter Journal LinesFig xii Create Manual JournalsEntering Journal Lines

To enter journal lines:

Enter a Line number for each journal line to control the sequence in which the journal entry lines appear online and in reports. After you enter the first journal entry line number, General Ledger automatically increments the numbers for the following lines. You can change the line numbers as necessary before committing the record. It is suggested to follow the line numbering in multiples of 10. (Viz 10,20,30 )Enter an Account combination for the journal line. The combination must have valid values for all the segments and the combination should be a valid combination. Enter the Debit or Credit amount for the designated account. In the case of a Foreign Currency Journal, the equivalent functional value based on the exchange rate entered in the Header region would be calculated by the system and displayed. The description entered in the journal header would default to the lines. Change the description appropriately if required to provide a more meaningfull narration for the line being entered. Proceed to complete the journal entry by entering all the required journal lines. The journals debit and credit value should match to facilitate posting of the journal. The system would allow saving of the document when the debits and credits are not matching. However, the document cant be posted until the debits and credits are equal. The functions of Shift+F5 and Shift + F6 could be utilised to copy the field value and the row values of the previous row. Where required, any support documents in digital format can be attached to the Journal using the attachments functionality. This attachment can be viewed by all who have access to the journal.

42Reversing journal entries are used to reverse accruals, estimates, errors, or temporary adjustments and reclassifications.

Reversal Method:Switch Debit / CreditChange Sign

Journal Creation : Reverse JournalsWhen a particular category or categories of journals are to be automatically marked for a reversal based on the period rules and the reversal has to be performed automatically, the same could be achieved through this configuration of AutoReverse Criterias.

For each journal category you define in General Ledger, you can select journal reversal criteria to control how and when your journals are reversed. You can also choose to enable autoReverse and autoPost to automatically generate and post your reversals.

3. Journal Reversals can be done using:Auto Reverse Journal functionalityEnter Journals Reverse functionality

43Journal PostingUpdate Account balances by posting journals.Three methods of journal posting:Use the Post Journals window to select and post several journal batches.Use the More Actions window to post a journal batch directly. This option is available only if the profile option Journals: Allow Posting During Journal Entry has been set to Yes.Use the Auto Post program to periodically post journal batches Manual Posting through Post Screen.

You can post journal entries to a prior accounting period, as well as to a prior fiscal year, as long as the prior period is openPosting Status can be:UnpostedPendingProcessingSelected for PostingPostedError.

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Journal Posting - Post Journals WindowFig xiii Journal Posting

Journals Post

1. Navigate to the Post Journals window. Note: You can also post a journal batch by choosing the Post button from the More Actions window when you are entering or reviewing a journal entry. This will post the entire batch containing the journal you are entering or reviewing.

2. Query the journal Batch you want to post. You can also query all unposted journal batches. You see the Batch name and the posting Period, as well as the Balance Type, indicating whether your batch affects Budget, Actual, or Encumbrance balances.

3. Review the Period Status and Post Status to determine if a batch is available for posting. You can post actual batches to open periods, budget batches to periods in an open budget year, and encumbrance batches to any period up to the last period in the latest open encumbrance year. Also, in case of Manual and other journals where approval is enabled at the source level, such journals can be posted only after they are approved by appropriate responsibilities.

4. Check the Control Total for the journal entry batch, if you entered one. If the control total does not equal Total Entered Debits and Total Entered Credits, you cannot post the batch, unless you allow suspense posting.

5. Select the journal batches you want to post by checking the box next to each batch.6. Choose Post to submit a concurrent request to post the selected journal batches.

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Journal Posting- Automatic PostingFig xiv Journal PostingSetup Journals AutoPostThis path will take you to the AutoPost Sets definition form. Use this form to define what journal sources and categories and balance type of journals should be posted automatically and for which periods. Once defined, the Autopost Set can be used to schedule the Posting of journals to be performed on a predetermined frequency (Say every 6 Hours) etc.To setup the Autopost Set, the following steps to be performedNavigate to the Autopost formEnter the Autopost Set name and DescriptionMark the Enabled check box if you want to enable the criteria set now. Otherwise, leave the check box unmarkedSet your posting submission options as explained belowSubmit All Priorities in Order: Select this option to submit the batches for all of your AutoPost priorities in the same AutoPost run. Note that priorities are processed in order, based on the Priority number.Submit Only Priorities with Batches in Order: Select this option to submit batches only from the specified Number of Priorities in the same AutoPost run. If a priority results in no selected batches it is not included in the count of the number of priorities whose batches are processed.If you choose the Submit Only Priorities with Batches in Order option, be sure to also enter the Number of Priorities.Enter the range of Journal Effective Dates:From: starting effective date of the range, entered as the number of days before the AutoPost submission date. This must be a number from 0 to 1000.To: ending effective date of the range, entered as the number of days after the AutoPost submission date. This must be a number from 0 to 999.AutoPost will only select journals whose effective date is within the range of days before and after the AutoPost submission date.Enter your AutoPost priorities for this criteria set. Each priority includes a Priority number, journal Source, journal Category, Balance Type, and Period.Additional Information: The priority number must be a value from 1 to 99, where 1 is the highest priority and 99 is the lowest. Batches with higher priorities are posted first. You can use the same priority number more than once.You can enter All in any field (except Priority number) to select all journal sources or categories, balance types, or accounting periods.Save your work.

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Journal Scenario #1 Exchequer Entry HeaderFig xv Journal Entry HeaderExchequer Entry:Journals >Enter > New JournalOnce the budget is announced, every ministry is allowed at the beginning of financial year, to spend half of the budgetfor this the Journal entry passed in GL as Exchequer. By Debiting Exchequer a/c and Crediting GAV Control a/c.

Enter Following Information on HeaderJournal Name is automatically defaultedSelect the appropriate periodChoose respective category for the Ministry (Adjustment)47

Journal Scenario #1 Exchequer Entry Line Fig xvi Exchequer Journal Entry Line

Exchequer Entry:Once the budget is announced, every ministry is allowed at the beginning of financial year, to spend half of the budgetfor this the Journal entry passed in GL as Exchequer. By Debiting Exchequer a/c and Crediting GAV Control a/c. (General Accounting Vote)

Enter Following Information on HeaderJournal Name is automatically defaultedSelect the appropriate periodChoose respective category for the Ministry (Adjustment)48

Journal Scenario #2 Receipt of Exchequer Fig xvii Exchequer Journal Receipt

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Journal Scenario #3 Advances to Employees(Imprest to Employees)

Fig xviii Imprest Journal

When advance given to employees, first funds to be reserved by passing encumbrance Journal(Called Imprest of Funds)Enter Header Information as belowJournal: automatically defaultsPeriod: Select the PeriodCategary: Initials of Ministry then adjustment Ex:MOWI Adjustment-Source and Balance type defaults as Encumbrance-Type as Commitment-Description as Imprest to Employee name to Nairobi for Official Duty-Line-Enter the Accounts where Dr Item should be charge a/c and-Credit line with Item Provision for Encumbrance a/c-Check funds-Reserve Funds-Post the Journal

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Journal Scenario #4 Salaries Journal before Payment in APFig xix Salaries Journal

Before Salaries Paid through Accounts payable module as expenditure it will capture in General Ledger ModuleEnter Header Information-Journal:Defaults -Period:Select Period-Category:MOWI Adjustment-Description:Salaries Payable for the month-Line-Give Account Code for Item by Debiting different charge a/c and Crediting Deductions and Salary Control a/c(Net Salary) EX: Dr Basic Salary Dr House Allowance Dr Medical Allowance etcCr DeductionsCr Net Salary(Salary Control a/c)-Check Funds-Reserve Funds-Post Journal

51Perform Inter-Agency Accounting OverviewThis is the end-to-end processing associated with invoicing, posting of transactions, settlement, dispute, reconciliation, and query management between entities within a Government or organization. For GoK, inter-agency accounting refers to when one ministry or agency acts as an agent on behalf of another ministry/agent for the purposes of procuring goods/services usually to benefit from economies of scale or because the agent ministry has the supplier relationships required already in placeThe initiation process is detailed below. However the accounting process will depend on the scenario and reasons for inter-agency accounting. If the procurement is in association with a particular project or program with its own budget inter-agency accounting is not relevant. Inter-agency accounting applies where the transaction is procurement outside of program-based budgeting for example where these are recurrent expenses but procured by one agency for another.

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Perform Inter-Agency Accounting To be Process Flow

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Record to Report Level 2 Perform Inter-Agency Accounting Initiation To be Process Flow

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Perform Inter-Agency Accounting Activity DescriptionsInter-agency procurement initiation process:ActivityActivity DescriptionManual/AutomatedOrganisational RolePro-Forma Letter Sent to AgentRequest sent by Principle Ministry to request another Ministry to act as Agent on their behalf.ManualPrinciple Ministry ProcurementReturn Pro-Forma to PrincipalAgent completes and return pro-forma to principalManualAgentProcurementAgree Payment Terms and TimeframesThe Principal and Agent organization should agree on whether the payment by the principal will be direct or in arrears and what the timeframe for payment should be. This should be agreed and recorded in the system to support online inter-agency accounting.NB If the Principal Ministry is paying direct then invoicing is done prior to procurementSystem Supported agreed terms can be entered on the systemAgent and Principle; IFMIS enter details on the systemIssue Invoice to PrincipalAn invoice is issued on the system from the agent to the principalAutomatedAgentMandate agent to carry out workThe principle mandates the agent to carry out the workManualPrincipleProcure Goods / ServicesThe agent procures the goods/services as agreedAutomatedAgentPayment Process TriggeredThe payment process is triggeredAutomatedAgent55ActivityActivity DescriptionManual/System SupportedOrganisational RolePayment Process CompleteThe payment process is completeAutomatedAgent Accounts DepartmentGenerate DataGenerate Data / Transactions / DocumentsAutomatedIFMISProcess DocumentsProcess inbound / outbound invoices, credits, billings, settlements, and statementsSystem supportedIFMISGenerate Matching ReportsEach agency generates reports in order to match items AutomatedIFMISPerform ReconciliationsItems are reconciledAutomatedIFMISConfirm BalancesConfirm BalancesAutomatedIFMISIdentify and Resolve IssuesVariances and discrepancies are identified and resolvedAutomatedIFMISResolve disputes and provide supporting documentationDisputes are resolved and any supporting documentation providedSystem-supportedAgent and PrincipleClose IssuesIssues are closedAutomatedIFMISFinalizeBalances are finalized and status report issuedAutomatedIFMISPerform Inter-Agency Accounting Activity DescriptionsInter-agency procurement initiation process:56Perform Inter-Agency Accounting Key Inputs and Outputs

InputProcessOutputPro-FormaReturn Pro-Forma to PrincipalN/APolicies and GuidelinesAgree Payment Terms and TimeframesN/AOnline DataGenerate DataData / Support DocumentsDataGenerate Matching ReportsMatching ReportsMatching ReportsPerform ReconciliationsReconciliation ReportReconciliation ReportIdentify and Resolve IssuesIssues LogIssues LogResolve disputes and provide supporting documentationFinalized Reconciliation ReportFinalized Reconciliation ReportFinalizeFinal Status Report57Other Considerations for the Perform Inter-Agency Accounting ProcessInter-agency transaction policy should be clearly defined and strictly enforced.Inter-agency transactions should be automatically managed in the system no out-of balance should be possible and no reconciliation should be requiredAgree inter-agency balances promptly (e.g. 5 days before the month end), by reporting balances that exist at that point in time (so only monitored and agreed final weeks)After applying the group consolidation tool, investigate only mismatches over a certain threshold (by the local reporting units).Require all entities to use a single, standard chart of accounts - Simplifies inter-entity transactions, reconciliations, and automating off-set entries58

Journal Scenario #6Agency Transactions in Principal MinistryFig xx Agency Transactions Journal

When ever there is requirement for ministries to subcontract to other Ministries then the Agency Transactions will come into picture. In this case there is need to enter Journals both in Principal Ministry books and also in Agent Ministry Books.Enter in Principal Ministry books as Encumbrace Journal.Header information will enter.-Journal:automatically defaults-Period:Need to select Period-Categary:Initials of Ministry then adjustment Ex:MOWI Adjustment-Source and Balance type defaults as Encumbrance-Type:Commitment-Description:Money given to MOF to pay on behalf of MOWI -Line-Enter the Accounts where Dr Item should be charge a/c and-Credit line with Item Provision for Encumbrance a/c-Check funds-Reserve Funds-Post the Journal 59

Journal Scenario #7Agency Transactions in Agent Ministry Fig xxi Agency Transactions Journal

The Agent Ministry will receive the funds from Principal Ministry and they will pass Journal in the GL books of Agent Ministry by Debiting Bank a/c and Crediting to Inter Ministerial Agency a/c 60

Journal Scenario #8Surrender of Agency Transactions in Principal BooksFig xxii Agency Transactions JournalOnce the Agency surrender the Expenditure,then in GL the encumbrance Journal will be Reversed.-Go to Journal form-take the Journal reference of Emcumbrance Journal and enquiry the same in Journal form-Click on Reverse-Post the Journal 61

Manage Interfaces Overview

There are a number of key integration points both within IFMIS and with external systems via purpose built interfaces. This process deals with the management of interfaces between these systems. Manage interfaces focuses on ensuring that the correct data files are transferred at the right time as per business need and liaising with sub-ledger departments and peripheral departments to resolve issues/errors

62GL Interface FlowPURCHASINGPAYABLESRECEIVABLES

Transfer To GeneralLedgerASSETSCASHMANAGEMENT

Journal BatchesJournal HeaderJournal LinesGL_INTERFACEJournalImportSPREADSHEETEXTERNALSOURCESRecording Flow

Each individual sub ledger application capture source transactions and upon validation converts them into appropriate accounting entry. Transfer to General Ledger process is a common interface program across all sub ledger application which includes fixed assets, purchasing, payables, receivables, and cash management.

Accounting transactions can also be captured from Spreadsheets and External non-oracle sources.

All the sub ledgers, spreadsheets and external sources populate the data in GL INTERFACE and General Ledger pulls the data in to General Ledger by running a batch process named Journal Import. Journal import created Journal Batches in General Ledger. Batches have multiple journals and each journal can have one or many lines.63

Manage Interfaces To be Process Flow

64

Manage Interfaces Activity Descriptions

ActivityActivity DescriptionManual / AutomatedOrganisational RoleConfirm Interface Inventory Schedule(Start Point)Interface schedule confirmed by line ministriesSystem-supportedIFMIS Department (R2R Process Champion)Review interface scheduleInterface schedule is received and reviewed by the IFMIS departmentSystem-supportedIFMIS Department (R2R Process Champion)Notify Outbound Interface AvailabilityNotify outbound interface availability from feeder systemsAutomatedIFMIS ITConfirm Interface AvailabilityConfirm interface availability per agreed scheduleAutomatedIFMIS ITRun and Monitor InterfacesRun and monitor system interfacesAutomatedIFMIS ITProcess DataProcess data; post sub-ledger transactions to GLAutomatedSystemPerform ValidationValidate interface execution and generate control reportsAutomatedIFMIS ITIdentify and Communicate ErrorsIdentify and communicate / escalate interface errors and exceptionsSystem-supportedIFMIS ITAuthorize correcting entriesAuthorize correcting entriesSystem-supportedIFMIS Department (R2R Process Champion)Resolve ErrorsResolve interface errors and book corrections as necessarySystem-supportedIFMIS Department (R2R Process Champion)65

Manage Interfaces Key Inputs and Outputs

InputProcessOutputOn-line policy / procedure manual Interface Inventory / ScheduleMapping from GL to sub-systemsReceive and review inventory / schedule(Updated) inventory/scheduleInventory / ScheduleRun and monitor system interfacesInterface DataInterface DataProcess data; post sub-ledger transactions to GLCompleted InterfaceCompleted InterfaceValidate interface execution and generate control reportsException / Control ReportsInterface Error / Out of Balance ReportException / Control ReportsInterface Error / Out of Balance ReportIdentify and communicate / escalate interface errors & exceptionsEscalated IssuesProposed Correcting EntriesEscalated IssuesProposed Correcting EntriesAuthorize correcting entries N/A66Other Considerations for the Manage Interfaces ProcessEstablish standard, electronic requisition and purchase order process available to appropriate members of the organizationPost all transactions to sub-ledger instead of the GL in order to keep GL clean and minimize reconciliation and analysis between the GL and sub-ledgers Aggregate sub-ledgers to GL frequently (weekly, daily, or instant) removes activities from close process; allows for interim flash reporting Automate interfaces.Any integrated ERP solution can provide drill-down capability from GL to the sub-ledgers simplifying account analysis Sub-accounts and general ledger should continuously reconcile Leverage single ERP / integrated systems to reduce number of interfaces.Key data elements should have the same definitions, usage guidelines, etc. regardless of what system the data resides 67Analyze & Reconcile Accounts OverviewQualitative and quantitative reconciliation of an account balance in accordance with documented policies and reconciliation criteria to a reliable and independent information source, identifying differences and assigning actions to resolve as appropriate. Reconciliations contribute towards the financial statement assertions of completeness and accuracy.

68

Analyze and Reconcile Accounts Process Flow

69Analyze and Reconcile Accounts Activity DescriptionsActivityActivity DescriptionManual/AutomatedOrganisational RolePerform reconciliations and analyze accountsPerform reconciliations and analyze accountsAutomatedAccountsAdjust account balances as necessaryAdjust account balances as necessarySystem SupportedAccountsFinalize Reconciliations and analytical reviewFinalize Reconciliations and analytical reviewAutomatedAccounts70Analyze and Reconcile Accounts Key Inputs and OutputsInputProcessOutputInternal Control ObjectivesOverall Accounting PolicyReconciliation PolicyReconciliation Schedule / OwnersPerform reconciliations and analyze accounts Account Reconciliation DocumentationProposed AdjustmentsAccount Reconciliation DocumentationProposed AdjustmentAdjust account balances as necessary N/AN/AFinalize reconciliations and analytical review Final ReconciliationsSummary Report71

Other Considerations for the Analyze and Reconcile Accounts Process

Sub-accounts and general ledger should continuously reconcile Accountability for data integrity should lie with local reporting unit.The local reporting unit should always have ownership of their own numbersTo assist in reinforcing this, central accounting should always notify the local unit of errors in their results72

Navigation: Inquiry > Account > ActualSummary Account Online InquiryFig xxiii Summary Account- Online InquiryWhen you perform an inquiry on a summary account, you can drill down to the detail balances that make up the summary balance. You can view these balances in their entered currency as well converted to your functional currency. You can also review the journal entries that affect your account balances during the period you specify. Prerequisites1.Enter your account inquiry criteria.2.Select a summary account for the inquiry.To review balances for a summary account:1.Choose the Show Balances button from the Account Inquiry window.You see information for each accounting Period and Currency in your selection criteria, including the PTD and YTD balances for your summary account. General Ledger displays all debit balances as positive amounts, and credit balances as negative amounts. 2. In a functional currency row, the balances include amounts entered in your functional currency, plus amounts converted from any foreign currency journals. Because the converted amounts are included in the displayed balances, there are no Converted PTD or YTD balances for your functional currency.3. If you are performing the inquiry for a single foreign currency using the Entered currency type, the PTD and YTD balances include only amounts from journals entered in the foreign currency. You also see the Converted PTD and YTD amounts, which are the functional currency equivalents of the foreign currency amounts.4. If you are performing the inquiry for a single foreign currency using the Translated currency type, you see PTD and YTD balances translated from your73Navigation: Inquiry > Account > ActualSummary Account Online InquiryFig xxiv Summary Account Online Inquiry

To review detail balances that roll up into a summary balance:1. Choose the Show Balances button from the Account Inquiry window.2. Select the summary balance row whose detail you want to review.3. Choose the Detail Balances button to drill down to all detail balances that roll up into the selected summary balance.4. You see the Period and Currency from the selected summary balance, as well as each detail Account that rolls up into the selected summary balance. You also see PTD and PTD Converted balances for each account.5. Choose the Journal Details button to review journal information for a selected detail balance row.6. Choose the Summary Balances button to return to the Summary Balances window.

74Online Account InquiryPerform Account Inquiry using the Account Analysis and Drilldown screenView Balance, Detail, and Variance Information and export to excel or drill down to sub ledgerSelect range of accounts for inquirySelect periodSelect balance type (actual / budget)View account balancesView Oracle GL or Oracle subledger transactionsPerform Journal Inquiry using the Journal Inquiry screenSelect Journal Name / source etc to inquire in view Journals screenView Journal line details and export the details to excel or drill down to sub ledgerAn account inquiry shows you actual, budget, and encumbrance account balances for summary and detail accounts. You can perform variance calculations for both summary and detail accounts.

You can also drill down to see the activity that comprises your detail account balances, including activity from the feeder modules.

When you perform an inquiry, note that the button on the left of most inquiry windows allows you to drill down to more detailed information, and the button on the right allows you to see higher level information.

75

Online Account Inquiry - DrilldownFig xxv Online Account Inquiry

Use this form to perform online inquiries for any summary or detail account in your set of books. You can review actual, budget, and encumbrance balances in any currency, and include variance calculations between balance types. You can also drill down to journal details affecting your account balances, and review subledger detail for all feeder modules except depreciation entries of Oracle Assets entries.

To perform an account inquiry:Navigate to the Account Inquiry window.Enter the range of Accounting Periods to include in your inquiry. Specify the currency to include in the inquiry:Select All Currencies to see account information in all currencies.Select Single Currency and enter a Currency to see only balances entered in or translated to that currency.Choose to see balances from transactions Entered in the inquiry currency, or balances Translated to that currency.Select the Primary Balance Type Choose a display and precision Factor:Units: Full precision; rounds to two decimal places. Thousands: Divides balances by 1,000; rounds to three decimal placesMillions: Divides balances by 1,000,000; rounds to three decimal placesBillions: Divides balances by 1,000,000,000; rounds to three decimal places. Enter an optional Summary Template name to restrict your inquiry to only those summary accounts associated with that template.Query the summary or detail Account(s) you want to review. If you entered a summary template, you can only query summary accounts associated with that template.76

Online Account Inquiry - DrilldownFig xxvi Online Account InquiryChoose the button that applies to the account information you want to see:Choose Show Balances to review balances for the current account based on your inquiry criteria.Choose Show Journal Details to see the journal entry activity for the current account based on your inquiry criteria. This button is not available if you choose to inquire on translated balances.Choose Show Variance to see a variance calculation between the primary balance type you defined for the inquiry and a secondary balance type. This button is not available if you choose to inquire on all currencies.

77Reporting in GL Standard ReportsAccount Analysis: Account Analysis Report, Account Analysis Detail Reports Average Balance Audit ReportChart of Accounts: Account Hierarchy Report, Chart of Accounts Listing, Rollup Detail Listing, Segment Values Listing, Suspense Accounts ListingJournal: General Journals Reports, Journal Batch Summary Report, Journal Entry Report, Journal Line Report, Journals Report with Sub ledger DetailTrial Balance: Average Balance Trial Balance Report, Budget Trial Balance Report, Detail Trial Balance Report, Summary Trial Balance ReportsOther: Mass Allocation Formula Listing, Recurring Formula ListingMulti-Company Accounting and Consolidation: Consolidation Audit Report, Consolidation Exception Reports, Consolidation Journals Report, Consolidation Rules Report,

78The General Ledger module provides various reports in analysing the data and also listing out the various master values. The reports that are provided as part of the standard applications can be grouped into followingAccount Analysis ReportsAccount Analysis ReportThe Account Analysis reports list the accumulated balances of a range of accounts and all journal entry lines that affect that range. The same segment security rules defined for your chart of accounts extend to these reports. These rules restrict user access to segment values in your accounting flexfield to those authorised by their responsibility.This report prints the journal entry lines and beginning and ending balances of the accounts you request. For each journal entry line, the report prints the source, category, batch name, journal entry name, account, description, entry/line/source item reference information, and the debit or credit amount.

Reporting in GL Standard ReportsAccount Analysis Report with Payables DetailThis report can be used to reconcile asset additions imported into General Ledger from Oracle Payables.The report prints the beginning balance, journal entry lines, and ending balance of the accounts you request. For each journal entry line, the report prints the batch name, journal entry name, account, line description, vendor name, invoice number, and the debit or credit amount.Account Analysis Report with Sub ledger DetailsThe report displays detail amounts for a specific journal source and category, in functional currency orSTAT. This report prints the journal entry lines and beginning and ending balances of the accounts requested. For each journal entry line, the report prints the accounting date, category, journal batch name, header, sequence, number, line, description, and amount. For each journal entry line, the report also prints subledger details, including the vendor or customer name, transaction number, associated transaction, sequence, number, line, and transaction type.

Chart of Accounts Report and ListingsAccount Hierarchy ReportThis report gives a list of detail accounts that roll up into each summary account for all summary templates. New page is created for each summary template. This report is prints the listing for the current set of books, without prompting you for any parameters.Chart of Accounts ListingsThis report gives a list of enabled detail accounts, disabled detail accounts, summary accounts. This report can be run for a range of accounts given in the parameters.Rollup Detail ListingThis gives a list of child segment values for each parent segment value for a specific account segment. GL sorts the listing in ascending order by account parent segment value.Rollup Range ListingGives a list of all parent segment values for an account segment. This listing includes information about each parent segment value, such as the rollup group to which each parent segment value belongs, whether each parent segment value is enabled and its range of child segment values. General Ledger sorts this listing in ascending order by parent segment value.79Submit Standard Report flowChoose to submit a requestor a set of requests Enter request information Select Submit Request Record request ID Enter parameter values Define submission schedule Define completion options May be requiredOptionalOptionalA standard report can be scheduled or run on the fly based on business needs80Submit Standard Report flowView-> Request-> Submit New Request-> Single Request

Fig xxvii Submit Standard Report FlowClose Books and Consolidate Financial Results OverviewThis sections details the monthly, quarterly, and / or annual process of booking period end entries, closing the ledger, consolidating financial results. Preparation of the actual financial reports is covered in the Financial Reporting process.

82Close Books and Consolidate Financial Results Process Flow

83Close Books and Consolidate Financial Results Activity DescriptionsActivityActivity DescriptionManual / AutomatedOrganisational RoleRecord Transactions Process(Start Point)As per the Record Transactions process transactions are recorded to the general ledger at period closeAutomatedSource system departments / AccountsClose GLThe general ledger is closed to prevent further recording of transactions during the period close activitiesAutomatedAccountsBalance and Close BooksBalance and Close BooksAutomatedLocal Reporting UnitsReview and ApproveReview and ApproveSystem-supportedLine Ministry Board (appointed by Accounting Officer)Perform Post-Close AdjustmentsPost close adjustmentsClear encumbrances; clear outstanding commitments; perform bank reconciliation etc. NB Complete list of period close activities required to be defined as part of next phase of implementation.AutomatedLocal Reporting Units Accounts DepartmentPrepare final accountsPrepare final accountsAutomatedTreasurySubmit to Accountant GeneralSubmit to Accountant GeneralAutomatedTreasuryAudit final accountsAudit final accountsSystem SupportedAccountant GeneralReview Final AccountsFinal accounts are reviewed in parliamentManualAccountant General84Close Books and Consolidate Financial Results Key Inputs and OutputsInputProcessOutputTransactionsRecord Transactions ProcessPreliminary G/LPre-close LedgerOverall Accounting PolicyClosing calendarPreliminary GLClose GLN/ADiscrepancies Adjustments requiredPerform Post-Close AdjustmentsFinalized Period EndAccounting Results (Period End Accounting Data) 85

Other Considerations for the Close Books and Consolidate Financial Results Process

Assign formal closing process ownersFormal close process and calendar managed by a single process owner Issue clear and concise instructions to all departments / entities stating what will be required of them and by when Pre-define communication and issue resolution approach Continuously focus on and formally measure close process improvements Establish a pre close meeting early in the closing cycle; Shift non-critical items to pre-close Discuss any unusual results with management and auditors Accountability for data integrity lies with local reporting unit. The local reporting unit should always have ownership of their own numbers Perform as many activities as possible in parallel (rather than consecutively). Limit period end / closing entries to only those that are required for financial reporting purposes or are material from a management reporting standpoint Currency translation happens automatically Simplify the allocations process Transmit all data electronically Create and post all reversals automatically 86GL Period CloseImport journals from sub-ledgersPerform reconciliation of sub-ledgersClose the period for each sub-ledgerPerform revaluation of foreign currency balancesVerify all journals are postedReconcile account balancesTranslate balances Perform consolidation if requiredRun Trial Balance and other reportsClose the GL periodOpen the next period

Reconcile the subledger data to General Ledger to ensure transfer and accounting of all subledger transactions in General Ledger

Perform reconciliation by:ReportsAccount Analysis

Flows:Procure to PayRevenue to Cash87Close the Sub ledgersSubledgersClose PeriodSuggested order for closing sub ledgers:

ProjectsPayablesPurchasingAssetsReceivablesInventoryGL Period cannot be closed before all subledgers are closed88Period Statuses

JOURNALENTRYPOSTINGPERIODSTATUSNEVER OPENEDFUTURE ENTERABLEOPENCLOSEDPERMANENT CLOSED

Period Statuses

Periods can have different statuses during different stages of accounting.

Never Opened: Period is only defined

Future Enterable: As per the business policy, it might allow to have 1-2 future periods to be available only for recording journals. However, cannot post during the future enterable period

Open is a regular status where normal current period and can create journals and do posting as well

Closed periods are not available for journal entries and posting. If need be, closed periods can be reopened

Permanent closed periods cannot be reopened89Close GL PeriodNavigation : Setup Open/Close)

Navigate to the Open and Close Periods window. General Ledger displays all accounting periods defined for your calendar with the period type of your set of books.Select the open period that you want to close.Enter a new status for the period. Enter Closed to prevent entering or posting journals to that period. You can reopen a closed period at any time. Enter Permanently Closed to prevent entering or posting journals to that period. You cannot reopen a permanently closed period. However, A period should be marked as Permanently Closed only after the Statutory Financial audit of the set of books for the given financial Year and after adaptation of the audited results by the Board of Directors.Save your work.

90Perform Financial and Regulatory Reporting OverviewFinancial Reporting:

Creation of standard financial statements and supplemental reporting in accordance with appropriate accounting principles.

Regulatory Reporting:

The process of creating statutory and / or regulatory reports and submitting to the appropriate authority

91Perform Financial and Regulatory Reporting Process Flow

92

Perform Financial and Regulatory Reporting Activity Descriptions

ActivityActivity DescriptionManual / AutomatedOrganisational RoleUpdate TemplatesUpdate Financial / Regulatory Reporting TemplateAutomatedIFMISPrepare ReportsPrepare Financial / Regulatory Report(s)AutomatedLine Ministry Accounting/Budgeting Department (report-dependant)Distribute, Review and Finalize For regulatory reports, reporting package should be compiled and submitted to regulatory authoritySystem-supportedLine Ministry Accounting/Budgeting Department (report-dependant)Respond to Requests as RequiredProvide information to auditors and other parties as appropriateManualLine Ministry Accounting/Budgeting Department (report-dependant)Maintain documentationEnsure any documentation required for external audit or other regulatory/statutory purposes are properly filed/scannedManualLine Ministry Accounting/Budgeting Department (report-dependant)93

Perform Financial and Regulatory Reporting Key Inputs and Outputs

InputProcessOutputUpdate TemplatesReporting templatesPeriod end accounting dataPrior period financial reportsPrepare ReportsReportsReportsDistribute, Review and Finalize Finalized reports94

Other Considerations for the Perform Financial and Regulatory Reporting Process

Differentiate between internal (mgmt.) and external (financial / regulatory) reporting needs but leverage a single data source One version of the truth All statutory/management reporting needs are supported through a single chart of accounts Automated financial reporting ERP / consolidation system should automatically feed financial reports / templates Quarterly hard closes are performed to meet external reporting needs, with monthly soft closes to meet internal management needs Put in place comprehensive training plans to ensure all staff are up to date on current and future financial reporting requirements. Regularly review accounting policies and compare to best practice, with reviews actively involving external and internal advisors Put in place comprehensive statutory reporting procedures that are regularly updated and communicated to staff. 95Overview of FSGsFinancial Statement Generator is the embedded tool provided within the General Ledger module of Oracle Applications, Generate financial reports, such as income statements and balance sheets, or compare based upon data in your general ledgerIt can be used for creating Financial Reports of Actual, Budgeted, Encumbered and Statistical Balances e.g. Balance Sheet, P & L, Comparison of Actual Balance against the Budgeted balance etc.

Use Financial Statement Generator (FSG) Reports to do the following: Create custom financial statementsCreate consolidated reports across ledgersReport on translated and foreign currency amountsReport on budget vs. actual and different amount types such as PTD, QTD, and YTDFeatures of Financial Statement Generator (FSG) Reports:Reports can be generated in excel, pdf or HTML format with company logo using the Report manager tool to publish the FSGsDrill down from reports to actual application data to perform audit and analysisCustomize the report templates with multiple formatting optionsSecurity feature on FSG reports to provide access to specific users based on COA valuesReports repository can be maintained by user to quickly review the past reports which were run and stored

96Page 97Run an FSG ReportReports-Define -> Reports

Fig xxviii Run an FSG Report97Navigation: GL Responsibility --> Reports --> Request --> Financial

Enter the name of Report and period for which you want the output.If you want to give any segment override, enter it.Click on Submit Tab. It will submit a concurrent request. Output of that request will be Report.

Perform Management Reporting OverviewManagement reporting deals with the consolidation and presentation of data, to managers, to support managerial decision making. In contrast to the previous section on financial and regulatory reporting these reports are generally published internally.This section details the Level 2 process for generating management reports. Management reports are highly varied and must be clearly defined as part of report development however all reports generally require the four steps detailed below to be followed.

98

Perform Management Reporting To-Be Process Flow

99Perform Management Reporting Activity DescriptionsActivityActivity DescriptionManual / AutomatedOrganisational RoleReview PerformanceMeasure & analyze performance against budget, target, and/or forecast and of business drivers / KPIsAutomatedReport dependent (IFMIS)Identify VariancesIdentify variances and root causesAutomatedReport dependent (IFMIS)Perform AnalysisPerform value added / ad-hoc analysis (e.g. scenario modeling)AutomatedReport dependent (IFMIS)Publish ResultsPublish / deliver dashboards, scorecards, and reports AutomatedReport dependent (IFMIS)100Perform Management Reporting Key Inputs and OutputsActivityActivity DescriptionManual / AutomatedOrganisational RoleReview PerformanceMeasure & analyze performance against budget, target, and/or forecast and of business drivers / KPIsAutomatedReport dependent (IFMIS)Identify VariancesIdentify variances and root causesAutomatedReport dependent (IFMIS)Perform AnalysisPerform value added / ad-hoc analysis (e.g. scenario modeling)AutomatedReport dependent (IFMIS)Publish ResultsPublish / deliver dashboards, scorecards, and reports AutomatedReport dependent (IFMIS)101

Other Considerations for the Perform Financial and Regulatory Reporting Process

Focus on the critical few metrics necessary to measure successful execution of strategy Address unit of measure, data source, frequency, and dimensions If we improve this metric, does it really matter for our stakeholders? Ensure metrics support key leadership decisions, what is the frequency of those decisions, and the information requirements for each? Segregate metrics by purpose Trending and root cause analysis are key components of an effective reporting process Information should be captured and reported quickly and consistently for all levels and all parts of the business Multi-dimensional profitability analysis methodology extended to all applicable dimensions e.g. customer, product, project, geography, market, contract type, pricing level, and channel Use analytics to customize offerings and maximize revenue / profit Fully integrated and automated reporting capability including simple user interface with drill-down capability Use a single reporting and analytic tool across the enterprise 102Proposed New Char of Accounts 103SegmentGroups/HierarchyComments1. Class(1 digit; one level)XIdentifies the categories of budget and also below the line items2.Vote(3 digits; 1 level)XXX Represents the Votes against which budget is appropriated3. Administrative(9 digits; 3 levels)XXX.XXXX.XXVote Head (Dept/Project) - Sub Head (Cost Centre)4. Source of Funding(8 digits; 4 levels) X.X.XXX.XXXIdentifies the broad source as well as specific source of funding5.Programmes(7 digits; 4 levels)XX.XX.X.XXSector Programme S/Programme - Output Activity6. Economic Items(7 digits; 5 levels)X.X.X.XX.XXCategory Chapter - Sub Chapter Item - Sub Item7. GeographicalLocation(7 digits; 3 levels)XXX.XX.XXCounty - Constituency WardIFMIS New Chart of AccountsIFMIS DEPARTMENTMinistry of Finance, Treasury BuildingHarambee AvenueP.O. Box 30007 - 00100Tel: +254 20 2252299Email: info@ifmis.go.keWebsite: www.ifmis.go.ke

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Level 2 Plan to Budget: Record Transactions (To-Be Process)

1A. Data to Accounts

Payment Process

External Source System

1B. Send Data to Accounts

IFMIS Sub-Ledger

Accounts

Process Automated JVs

Review and Approve Automated JVs

Level 2 Plan to Budget: Inter-Agency Accounting (To-Be Process)

Principal Ministry

Procure Goods / Services

Agree Payment Terms and Timeframes

Mandate Agent to Carry Out Work

Issue Invoice to Principal

Send Pro-Forma letter to Agent

Agent

Payment Process

Return Pro-Forma to Principal

Level 2 Plan to Budget: Inter-Agency Accounting (To-Be Process)

Principal Ministry

Resolve Disputes and Provide Supporting Documentation

Close Issues

IFMIS

Generate Matching Reports

Perform Reconciliations

Generate Data

Process Documents

Confirm Balances

Identify Issues

Agent

Finalise

Payment Process

Level 2 Plan to Budget: Manage Interfaces (To-Be Process)

Perform Validation

Identify and Communicate Errors

Review interface schedule

Run and Monitor Interfaces

System

Confirm Interface Availability

Process data

IFMIS IT

IFMIS Department

Notify Outbound Interface Availability

Authorize correcting entries

Resolve Errors

Confirm Interface Inventory Schedule

Level 2 Plan to Budget: Analyse and Reconcile Accounts (To-Be Process)

Accounts

Perform reconciliations and analyse accounts

Finalize reconciliations and analytical review

Adjust account balances as necessary

Level 2 Plan to Budget: Close Books and Consolidate Accounts (To-Be Process)

Accountant General

Submit to Accountant General

Review Final Accounts

Prepare Final Accounts

Perform Post-Close Adjustments

Line Ministry Accounting Departments

Review and Approve

Balance and Close Books

Accountant General

Finalize reconciliations and analytical review

Perform Audit

Line Ministry Review Board

Close GL

Record Transactions Process

Level 2 Plan to Budget: Perform Financial & Regulatory Reporting (To-Be Process)

Respond to Queries

Maintain Documentation

IFMIS

Update Templates

Distribute, Review & Finalise Reports

Line Ministry Accounting / Budgeting Department (Report-dependent)

Prepare Reports

Level 2 Plan to Budget: Perform Management Reporting (To-Be Process)

Perform Analysis

Publish Results

Report Dependent (IFMIS)

Identify Variances

Review Performance