BP.080 Future Process Model

AIM

BP.080

Future Process Model

Cash Management

The National Company for Glass Industries – Zoujaj

Oracle Applications Implementation Project – Release 12

Author: Padmaiah.V

Creation Date: January 10, 2010

Last Updated: February 10, 2010

Document Ref: 1.0

Version: 1.0

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Approvals:

Mr. Yousef Al Salman / General Manager / Project Sponsor , Zoujaj
Mr. Hatem Al Fadli / Group Finance Manager , Zoujaj
Zulfiaqar Ali Najeeb / Project Manager, Zoujaj
Sathyanarayana Sarma / Project Manager, Sierra Atlantic

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Document Control

Change Record

1

Date / Author / Version / Change Reference /
10-Jan-2010 / Padmaiah V / Draft 1.0 / No Previous Document
19-Jan -2010 / Sathyanarayana Sarma / Draft 1.0 / Not Applicable
23-Jan-2010 / Sathyanarayana Sarma / Draft 1.1 / Not Applicable
10-Feb-2010 / Sathyanarayana Sarma / 1.0 / Version Change

Reviewers

Name / Position /
Sathyanarayana Sarma / Project Manager – Sierra Atlantic
Mr. Balan / Asst Group Finance Manager – Zoujaj
Mr. Anantha Krishnan / Oracle CoE, Sierra Atlantic

Distribution

Copy No. / Name / Location /
1  / Library Master / Project Library
2  / Zoujaj Project Manager / Riyadh, Saudi Arabia
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Contents

Document Control ii

Introduction & Scope 4

Future Business Model 5

Future Processes 9

Future Process Descriptions 10

Future Process Diagrams 13

CE.BP.01 Define and Maintain Banks 13

CE.BP.02 Define Payment Templates 14

CE.BP.03 Define Cash Forecasting Template 15

CE.BP.04 Define Cash Positioning Worksheet 16

CE.BP.05 Bank Transfers 17

CE.BP.06 Clear Transactions 18

CE.BP.07 Create Miscellaneous Transactions 19

CE.BP.08 Generate Cash Forecasts 20

CE.BP.09 Generate Cash Positioning 21

CE.BP.10 Generate Reports 22

Cash Management Business Solution Matrix 23

Critical Requirements 23

Current Benchmark Activities 24

Current Bottlenecks 25

Open and Closed Issues for this Deliverable 26

Open Issues 26

Closed Issues 26

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Document Control iii

File Ref: Zoujaj_BP080_CE_1.0 Zoujaj / Sierra Confidential

Introduction & Scope

Note:  Modify the introduction to match what was actually done in the task and will be included in this deliverable. The following is a sample introduction.

This document consists of the Future Process designs including high-level design, the various Organizations (Divisions) at National Company for Glass Industries - Zoujaj will operate after the Oracle Cash Management system is implemented in this project.

The Process Designs included in this document are generic and intended to apply across the whole of the Organization(s). Designs for variants, such as business units or departments, will be produced in this deliverable. The generic process model explains in high-level terms how work will flow in the future and who will be responsible for completing the activities. It is composed of the following components:

·  Future Business Model (Proposed Model) – A detailed diagram and necessary descriptions for any proposed business set ups that would form the basis of the proposed processes.

·  Process Flow Diagram—A description of the process level (high-level) design and sub processes in graphical form wherever applicable.

·  Process Descriptions & Events—A high-level, textual description of the process that is executed in response to each event, together with an identification of the processes main inputs and outputs.

·  Sub Process Flow Diagram & Description - A description of the sub process level design and sub processes in graphical form. A textual description and graphical representation of the process that is executed in response to each event, together with an identification of the process’ main inputs and outputs.

Future Business Model

Cash Management module will carry out the business functions of Bank Account (s) Management, Bank Reconciliation, Cash Positioning and Cash Forecasting. Oracle Cash Management is an Enterprise cash management solution that helps effectively manage and control the cash cycle. With Cash Management, the business requirements of Bank Account Management, Reconciliation, Cash Positioning and Forecasting activities are comprehensively met.

The broad scope of Cash Management module will be as follows:

1.  Define and Maintain Banks and Bank Branches:

a.  Bank Definition and Maintenance: Banks and Bank Branches are defined and maintained in Oracle Cash Management.

b.  Security and Access Controls: Cash Management provides for a comprehensive security management facility for Bank Accounts. Bank Accounts are secured at the Legal Entity Level and access is given to various Divisions / Operating units. The Bank Account Access – Security and Setup mechanism controls the “Bank Account Access” and “Use” of the Organization’s Bank Accounts. This simplifies the Bank Access, Bank Account Maintainenace and Bank Account Reconciliation process.

1. Bank Account Transfers: Bank Account Transfers represents “Funds Transfer” between Organizations (Internal) Bank Accounts. For Funds Transfer, Cash Management provides the facility to define reusable templates that can be used during the Fund Transfer facility. Bank Account transfer creates a “Cash Flow” which can be cleared in the system.

1. Bank Reconciliation: The Reconciliation functionality provides the automatic or manual loading of bank statements and reconciling against system transactions. Validation and reconciliation of transactions can be reviewed and corrected online. For banks that provide electronic files, Bank Statements can be imported into Oracle Cash Management through Bank Statement Open Interface Tables. After the bank statements are imported into the system, the bank Reconciliation can be run for these banks. Miscellaneous transactions can also be created during the Reconciliation process to record bank initiated activities such as interest and bank charges. Bank Reconciliation in Cash Management is an integrated application that works with Receivables and Payables.

1. Clearing Receipts, Payments, Miscellaneous transactions: Transactions can be manually cleared in Cash Management after they have been cleared from the bank.

1. Creating Miscellaneous Transactions: Miscellaneous Transactions can be created for bank originated entries like Banks Charges etc. Miscellaneous charges are created as negative Miscellaneous Receipts in Oracle Receivables. During Reconciliation, Miscellaneous Payment (Ex: Bank Charges), which is a negative receipt, is reconciled to a payment bank statement line with a positive amount.

1. Cash Positioning: Cash Positioning is a planning tool that helps viewing daily “Cash Position” by currency or bank account. Cash positioning allows in the projection of cash needs, and evaluate Organization’s liquidity position. The daily cash positions are based on actual cash flows from various Oracle Applications (Receivables, Payables, etc). Cash Positioning can be generated on a daily basis for a single currency, multiple currencies, a single bank account, multiple bank accounts, and a Legal Entity.

1. Cash Forecasting: Cash Forecasting is a planning tool that anticipates the flow of cash in and out of business allows to project cash needs and evaluates the liquidity position. For using the Cash Forecasting feature in Oracle Cash Management, a Cash Forecasting template has to be defined in the system and to which the various sources and the periods are to be assigned. A Cash Forecasting template specifies the Cash Forecast specifications. It comprises of Rows (Sources) and Columns (Periods) for generating Cash Forecasts. Cash Forecasting involves two steps:

a.  Creating a Cash Forecasting Template: A Cash Forecast template is a matrix, similar to spreadsheet, with each row defining the source of the cash flow and each column defining the forecast period in GL periods or in days.

b.  Generating Cash Forecasts from the Templates: A Cash Forecast can be generated using the Submit Forecast window or by using the submit requests window in Oracle Cash Management. When the forecast is submitted, it generates the forecast information based on the parameters provided such as the start and the end date and currency, collects the necessary source data and summarizes the information as cash forecast amounts based on the forecast period specifications. The forecast data is available for update, inquiry or reporting purposes and can also be exported to a spreadsheet.

8.  Generating Cash Management Reports

Cash Management provides for a number of reports to review and analyze the Cash Management activities. Cash Management reports can be run to review the respective business reporting requirements.

Cash Management Set ups

Cash Management uses information from Oracle General Ledger, Oracle Payables and Oracle Receivables for Bank statements reconciliation; and from Oracle General Ledger, Oracle Order Entry, Oracle Payables, Oracle Purchasing, and Oracle Receivables for cash forecasting. Set ups steps in these respective modules / applications relating to cash management will need to be done before using Cash Management with them.

Cash Management fully integrates with General ledger, Receivables, Payables and Purchasing as depicted in the chart below

System Parameters

System parameters determine, for example, the default options for manual reconciliation windows, and the control settings for the Auto Reconciliation program and accounting controls for Cash Management transactions

I.  Basic System Parameters:

·  Legal Entity: The name of legal entity that system parameters are applied to.

·  Ledger: The name of the Ledger for Cash Management accounting transactions. This value defaults from the GL Data Access Sets profile option.

·  Begin Date: Begin date is the date from which Cash Management will start displaying transactions. Cash Management will not display transactions dated earlier than the Begin Date.

II.  System Controls and Cash Management Transaction Parameters:

1.  System Controls: System Controls refer to the controls relating to Bank Reconciliation activities and determine the default options for manual reconciliation and control settings for Auto Reconciliation program.

2.  Cash Management Transaction Controls: The Cash Management Transactions parameters control the Accounting of the Cash Management Transactions. Cash Management Transaction parameters include the

o  Accounting - Exchange Rate Type (Corporate, User, etc), Cash Statement Cash Flow Rate Date, and Bank Transfer Rate Date ; and

o  Bank Account Transfers Authorization –Authorization for Bank Account Transfers : Whether required or Not

Payment Templates

A Payment Template is used during the Bank transfers. A Payment template allows defining reusable set of Bank Account transfer attributes and Payment Processing options. The Source Bank Account (the bank from which the transfer will be made) and Destination Bank Account (the Bank Account that will receive the transfer) will need to be specified in the template. During the Bank Account transfer, the system provides an option to select a Payment Template. If the Payment Template is selected all the attributes of the Payment Template will default into the Bank Account Transfer.

Accounting Calendar

The Accounting calendar defined and used in the General ledger is applicable in the Cash Management.

Future Processes

Future Process Descriptions 11 of 26

File Ref: Zoujaj_BP080_CE_1.0 Zoujaj / Sierra Confidential

Future Process Descriptions

Sl No. / Event / Process id / Description of the Response to the Event / Inputs / Outputs / Frequency/ month / Responsibility / Corresponding Event id in RD20 (Current Business Process Document) / Changes from the existing process /
1.  / CE.BP.01 / Define Internal Banks
Internal Banks and Bank Branches are defined and maintained in Cash Management.
Banks are secured at the Legal Entity level and Bank Account access is given to the respective Divisions (Operating Units). The Bank Accounts Access determines which Divisions (Operating Units) can access the Bank Account. Bank Account information can be accessed and updated any time (based on Account access).
The Payment Documents (Cheque Book Details) and GL accounts are assigned to the Bank Accounts. / List of Internal Banks details and respective GL Accounts / Defined Banks, Bank Branches and Bank Accounts / One Time, As and when required / Finance Department / CE RD 1.1 / New Setup process
2.  / CE.BP.02 / Define Payment Templates
Payment templates are used during the Bank transfers. Payment Template specifies the default attributes and payment processing options for the Bank transfer. / Template Specifications / Defined Payment Template / One Time , Periodic / Finance Department / CE.RD.2.1 / New Setup process
3.  / CE.BP.03 / Define Cash Forecasting Template
A Cash template provides for the Cash Flow specifications. It consists of Rows (Sources) and Columns (Forecast Periods) for which a forecast can be generated. Cash Forecasting Template(s) are used during the Cash Forecast generation process. / Template Specifications, Different Sources and periods / Defined Cash Forecasting Template / One Time , Periodic / Finance Department / CE RD 6.1
CE RD 6.2 / New Setup Process
4.  / CE.BP.04 / Define Cash Positioning Worksheet
A Cash Positioning Worksheet provides the Cash positioning specifications. It consists of Rows (Sources) and Columns (Bank Accounts) for generating the Cash Position. / Template Specifications - Different Sources and Bank Account inputs / Defined Cash Positioning Worksheet / One Time , Periodic / Finance Department / CE RD 6.4
CE RD 6.5 / New Setup Process
5.  / CE.BP.05 / Bank Transfers
Bank Transfers are to be validated before they can successfully processed. After validation and in “Settled” status, Bank Account Transfers are to be accounted. The “Create Accounting” process creates the Accounting entries for the Bank transfer and transfers the accounting to the General Ledger. Manual Bank Transfers create “Cash Flows”, which are available for clearing and reconciliation in Cash Management. / Payment Template / Bank transfer settled and accounted / As and when required. / Finance Department / CE.RD.2.1 / New Process. Bank transfers between the Bank Accounts held by the respective divisions will be handled in Cash Management.
6.  / CE.BP.06 / Clearing Transactions
The system transactions can be manually cleared in the system after obtaining the statement from the bank. While clearing the transactions, the transaction cleared date and cleared amount need to be mentioned. / Bank Statement information and System Transactions / Cleared bank transactions / As and when required / Finance Department / CE RD 3.1
CE RD 4.1
CE RD 4.2 / New Process. System Transactions can be cleared in the system.
7.  / CE.BP.07 / Create Miscellaneous Transactions
Misc Receipts can be created during the clearing process for any entries like Bank charges etc in the Bank Statement and not reflected in the Oracle system. / Defined Receivables Activities, Bank statements / Created Miscellaneous transactions / At the time of clearing / Finance Department / CE RD 5.1 / New Process.
8.  / CE.BP.08 / Cash Forecasts – Generate Cash Forecasts
Cash Forecasts can be generated at periodic intervals to view the Cash Forecast for the desired period. / Defined Cash Forecast Template / Cash Forecast Statement / As and when required / Finance Department / CE RD 6.2
CE RD 6.3 / New Process.
Cash Forecasts will be generated online in the new system.
9.  / CE.BP.09 / Cash Positioning – Generate Cash Positioning
Cash positioning can be generated on a daily basis for a single currency, multiple currencies, a single bank account and multiple bank accounts. The daily cash positions are based on actual cash flows in various Oracle Applications. / Defined Cash Positioning Worksheet / Cash Positioning Statement / As and when required / Finance Department / CE RD 6.4 / New Process. Cash Positioning will be generated online in the new system i.e. Oracle Cash Management
10.  / CE.BP.10 / Generate Reports
Cash Management provides a number of reports to review Cash management activities. The following are some of the useful reports that can be generated from Cash Management and can be used for reconciliation and reporting :
1.  Cash Forecast Report
2.  Cleared Transaction report
3.  Cash Positioning Statement
4.  GL Reconciliation Report / Report Parameters / Report / As and When required / Finance Department / CE RD 6.5 / New Process. Reports can be generated Online in the new system i.e. Oracle Cash Management

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