DFA SHARE Cash Remediation Phase II
Project Charter For Certification
Executive Sponsors –Tom Clifford, DFA Secretary; Ricky Bejarano, Deputy Secretary and Controller; Darryl Ackley, DoIT Secretary;
Business Owner –Maurice McAlister, DFAAudit and Vendor Relations Bureau Chief;Joann Chavez, DFA Statewide Financial Accounting and Reporting Bureau Chief, Ron SpilmanDFA Cash Control Manager
Project Manager – TBD, SHARE Special Projects Leader
Original Plan Date: June 1, 2014
Revision Date:
Revision: 1.0
About This Project Charter DOCUMENT
Permission to plan the project and setting the governance structure
The Project Charter provides the project manager and project team with permission to proceed with the work of the project, within the scope delineated in this document. The Project Charter should be the outcome of a number of documents that went into the pre-planning for the project, and in many cases the agency IT Plan, Business Case for appropriations, Federal funding requests and the like.
Project sponsors sign the Project Charter signifying that they have agreed to the governance structure for guiding the direction for the further planning of the project, discovery and defining the requirements, acquiring necessary resources, and within that context the statement of work for any related contracts including a contract for the Independent Validation and Verification.
The Project Charter is also the foundation for the creation of the project management plan, and much of the thinking and writing for this charter will be immediately usable for that project management plan.
Project certification Initial phase documentation
The Project Charter is also used within the State of New Mexico IT Project Certification process as evidence of the project’s worthiness for the Initial Phase certification. The Initial Phase certification is especially critical to many state and agency projects because of its related release of the initial funds required for the project.
Initiation Phase funding is requested by an agency for use in developing project phases, developing Independent Verification and Validation (“IV&V”) plan and contract; address project review issues and/or to develop an overall project management plan. Note: Waiver of the IV&V requirement requires specific written approval by the Secretary of the DoIT.
DoIT “Project Certification” Memorandum July 2, 2007
The Project Charter and the Request for Certification Form are meant to provide a comprehensive picture of the project’s intention and initial planning, that includes the project’s place in the context of the State of New Mexico’s IT Strategic Plan, Enterprise Architecture, and DoIT project oversight process. See “IT Project Oversight Process” Memorandum July 5th 2007 on the OCIO-DoIT web site.
table of contents
About This Project Charter DOCUMENT
table of contents
1. project background
1.1 Executive Summary – Rationale for the project
1.2 Project Certification Requirements
2.0 Justification, Objectives and impacts
2.1 Agency Justification
2.2 Business Objectives
2.3 Technical Objectives
2.4 Impact on Organization
2.5 Transition to Operations
3.0 Project/Product Scope of Work
3.1 Deliverables
3.1.1 Project Deliverables
3.1.2 Product Deliverables
4.0 Schedule Estimate
5.0 Budget Estimate
5.1 Funding Source(s)
5.2. Budget By Major Deliverable or Type of expense -
6.0 Project Authority and Organizational Structure
6.1 STAKEHOLDERS
6.2 PROJECT GOVERNANCE PLAN
6.3 PROJECT MANAGER
6.3.1 PROJECT MANAGER CONTACT INFORMATION
6.4 PROJECT TEAM ROLES AND RESPONSIBILITIES
7.0 Constraints
8.0 Dependencies
9.0 Assumptions
10.0 Significant Risks and Mitigation Strategy
11.0 COMMUNICATION PLAN
11.1 Communication Purpose & Objectives
11.2 Communication Approach
11.3 Communication Success Factors
11.4 Communication Roles & Responsibilities
11.5 Communication Process
11.6 Target Audiences
11.7 Topics for Communication
11.8 Status Meetings
12.0 INDEPENDENT VERIFICATION AND VALIDATION - IV&V
13.0 Project Charter Agency Approval Signatures
14.0 Project Charter Certification Approval Signature
Revision History
Revision Number / Date / Comment1.0 / May 14, 2014 / Original DoIT PMO Document
1
PROJECT CHARTER – DFA SHARE Cash Remediation Phase II
1. project background
The project background section is meant to provide the reviewer with a picture of the development of the project from inception to its being submitted for certification.
1.1 Executive Summary – Rationale for the project
Several reports and memos were written or commissioned over the past several years regarding the Cash Accounting Controls (LFC, 2012) and the Current State Diagnostic of Cash Control (Deloitte, 2012). Each of these documents points to the evolving relationship between DFA, STO, and DoIT. These reports also identified a need for an alignment of business and accounting practices to better serve the needs of the State through the use of an integrated book of record, implementation of leading practices associated with cash flows, and cash accounting.
DFA and STO completed the Cash Remediation Phase I project in FY 2013 to remediate the initial implementation of the SHARE Treasury Cash Management module. This first phase of the project provided a significant amount of improvements in the controls associated with processes related to State’s cash flows and the related accounting activity focusing on deposits and cash movement between bank accounts and investments.
The project also identified additional steps and actions required to further streamline and provide proper controls over the processes associated with accounting for cash receipt activity, payment activity, and general ledger activity.
The Cash Remediation Phase II project will focus on using delivered functionality in the Accounts Payable (AP) Module to provide the necessary controls over the accounting and creation of payments of all State agencies. This initiative will also include utilizing delivered Electronic Data Interchange and Data Archiving capabilities within the module.
The project will also use delivered General Ledger (GL) functionality to streamline accounting processes and provide additional controls associated with the accounting activity. There will also be a redesign of the monthly and year end close processes in order to establish proper controls over financial reporting.
The final initiative of the project is to provide additional controls over miscellaneous bank activity such as returned checks that were deposited.
The project objectives will focus on:
- Implementation of leading practices associated with all related disbursement activity (accounting, approvals, staledating, check printing, positive pay file processing, escheatment to name a few) of systems that are currently using the Payment Load and Third Party Warrant processes
- Increased controls and automation of banking interfaces associated with payment activity
- Reduced reliance on manual data keying associated with miscellaneous banking activity
- Use of delivered functionality to improve controls over management of the General Ledger
- Streamline and create/improve controls associated with the SHARE closing processes
- Redesign and implement a new Inter/Intra Agency accounting and settlement process
The project will focus on the following business processes:
PROCESS / DESCRIPTIONPayment related activity for non SHARE vendor payments / Creation and accounting of payment related activity (warrants, ACHs, cancellations, and staledating) by the current payment load and Third Party Warrant systems
Cash Accounting & Reconciliation / The accounting of bank transactions reported on a daily basis through balance reporting against the SHARE General Ledger and the State’s bank accounts.
Bank Interfaces / Communications / The retrieving and sending of data via secure methods to conduct activities such as funds transfers, accounting entries,positive pay files, and reconciliation of transactions
Financial Accounting Controls / The accounting entries being processed via direct entry to the GL are being properly recorded and controlled, the financial opening and closing processes are properly controlled, and the Inter/Intra agency accounting and settlement process is properly being performed and controlled. SHARE modules/sub ledgers arereconciled to the General Ledger and all accounting entries in the modules are in the General Ledger. There is consistent financial reporting at the agency and state level (CAFR).
1.2Project Certification Requirements
Does the project fit into the criteria for certification? Which and how?
CRITERIA / YES/NO / EXPLANATIONProject is mission critical to the agency / YES / Enhancement of controls over cash outflows, inflows, and related accounting will provide additional assurances to the citizens that the financial health of the state as presented is accurate.
Project cost is equal to or in excess of $100,000.00 / YES / The initial budgetary estimate is $4.5 million
Project impacts customer on-line access / YES / There will be business process changes that will require users to perform activities differently
Project is one deemed appropriate by the Secretary of the DoIT / YES / Manual processes do not provide adequate controls as identified in Cash Control Diagnostic and Cash Remediation Phase I projects. Also the lack of controls has resulted in financial reporting issues. Potential hard credit capture related to elimination of manual processes.
Will an IT Architecture Review be required? / NO / Current SHARE functionality will be used
2.0 Justification, Objectives and impacts
The justification and objectives section relates the project to the purpose of the lead agency and describes the high level business and technical objectives for the project. The section also includes a high level review of the impact to the organization, and of the concerns for transition to operations.
2.1 Agency Justification
Number / DescriptionAgency justification 1 / DFA is responsible for the financial controls and reporting of all state agencies. There have been significant control and business process issues identified by DFA in the Cash Control Diagnostic Report and the CAFR Diagnostic Report, both published in 2012. There has also been identification of improperly used functionality within SHARE. The Cash Remediation Phase I project also identified several more areas where a lack of controls exists. This project will address a significant number of the remaining issues including the bank account reconciliation issues associated with payment activity.
Agency Justification 2 / DFA desires to implement leading practices associated with accounting, financial reporting, and controls in order to maintain the public confidence in the state’s financial information. DFA also needs to implement the leading practices in order to properly train the agencies and get the end users familiar with the system processes that will be in place when SHARE is upgraded to 9.2. Over 80% of the work done in this project will be transferrable to the new software version.
2.2 Business Objectives
Use the following table to list measurable business objectives
Number / DescriptionBusiness Objective 1 / All payment related activity, except payroll, for all State agencies will be made through SHARE AP, warrants will be controlled (printed and mailed) from a central location and the approval and auditing processes will be streamlined.
business objective 2 / Accounting for banking related activity, including returns, will occur within 4 business days of the occurrence of the bank activity
BUSINESS OBJECTIVE 3 / Improved financial controls and regulatory compliance through the use of delivered GL functionality
BUSINESS OBJECTIVE 4 / Reconciliation of all bank activity will occur on a daily basis and the transaction reconciliation status reflected in SHARE will properly reflect the transactions status.
BUSINESS OBJECTIVE 5 / Warrant activity will be reflected at the bank in a timely manner as to maximize the use of the Fiscal Agent Bank’s Positive Pay services
BUSINESS OBJECTIVE 6 / Provide proper staledating of warrants
BUSINESS OBJECTIVE 7 / Reduce exposure to fraud risk by eliminating the manual handling of and manipulating of payment files going to the bank and accounting files going to the GL
BUSINESS OBJECTIVE 8 / Streamline processes and improve controls over the SHARE month and year end close process including creating controls over accounting for GL activity to ensure complete and accurate financial reporting. This will also reduce the time required to perform the close and improve the accuracy of information in SHARE.
2.3 Technical Objectives
Number / DescriptionTechnical Objective 1 / Expand the use of the delivered functionality of the current SHARE PeopleSoft ERP software for the GL. AP, AR, and TR modules
Technical Objective 2 / Replacement of the customized processes associated with payment activity of non SHARE systems
Technical Objective 3 / Creation of an automated process to handle returned deposit activity and adjustment/removal of AR customization associated with Deposits
Technical Objective 4 / Automate the payment interfaces between SHARE and the Fiscal Agent Bank
Technical Objective 5 / Create and implement security roles to support new controls
Technical Objective 6 / Eliminate manual running of system processes by through delivered automating and schedule of the system processes associated with the objectives.
2.4 Impact on Organization
The impacts on the organization are areas that need to be addressed by the project through its planning process. They may not be internal project risks, but they can impact the success of the project’s implementation.
Area / DescriptionEnd user / The end users for AP and GL will require training on new functionality and processes. The technical teams will require training on the use of delivered functionality, new business processes, and the customized programming
Business Processes / The following business processes will be impacted:
- Payment related processing for external payment systems including check issuance, check printing, staledating and banking interfaces
- General Ledger chartfield data management being centralized. This includes the opening and closing of all GL chartfields values in the system
- General Ledger accounting entry and module reconciliation processes
- Monthly and annual close process and the associated reporting
It Operations and staffing / The impact to the DoIT operations will include new support of different interface structures and some custom coding as well as a change in the support structure for the system.
The DFA and Agency technical staffs will also have new responsibilities associated with the new processes.
Other / There will be some significant changes to the current business processes in order to begin aligning them with the 9.2 upgrade. There will also be an elimination of a significant amount of manual work being performed in DFA.
2.5 Transition to Operations
The transition to operations areas include items that are asked in the certification form to assure that the project has accounted or will account for these matters in its planning and requirements specifications.
Area / DescriptionPreliminary Operations location and staffing plans / Staff at DoIT for SHARE support, DFA financial and technical staff, and agencies operations staff will maintain their current locations and staffing plans. There will be adjustments to the responsibilities of the areas.
Data Security, Business Continuity / The existing data security protocols will be adjusted to include new and changed SHARE functionality and control requirements.
Maintenance Strategy / The existing maintenance strategy will be extended to include new and changed SHARE functionality and control requirements
Interoperability / The following will have new interoperability designs:
- Applications currently using the Third Party Warrant and the Payment Load processes
- Staledating of Warrants
- GL Excel Upload process
- Monthly and Annual close
- General Ledger chartfield maintenance
Record retention / The existing records retention protocols will be extended to include new SHARE functionality
Consolidation strategy / Customizations currently used for affected processes will be evaluated and eventually eliminated.
3.0 Project/Product Scope of Work
In its efforts to move from high level business objectives to the desired end product/service the project team will need to deliver specific documents or work products. The State of New Mexico Project Management Methodology distinguishes between the project and the product.
Project Deliverables relate to how we conduct the business of the project. Product Deliverables relate to how we define what the end result or product will be, and trace our stakeholder requirements through to product acceptance, and trace our end product features and attributes back to our initial requirements
3.1 Deliverables
3.1.1 Project Deliverables
This initial list of project deliverables are those called for by the IT Certification Process and Project Oversight memorandum, but does not exhaust the project deliverable documents
DELIVERABLE / DESCRIPTIONProject Charter / The Project Charter for Certification sets the overall scope for the project, the governance structure, and when signed is considered permission to proceed with the project. The Project Charter for Certification is used to provide the Project Certification Committee with adequate knowledge of the project and its planning to certify the initiation phase of the project
Certification Form / The Request for Certification and Release of Funds form is submitted when a project goes for any of the certification phases. It deals with the financial aspects of the project, as well as other topics that indicate the level of planning that has gone into the project. Many of the questions have been incorporated into the preparation of the project charter
Project Management Plan / The“Project management plan” is a formal document approved by the executive sponsor and the Department and developed in the plan phase used to manage project execution, control, and project close. The primary uses of the project plan are to document planning assumptions and decisions, facilitate communication among stakeholders, and documents approved scope, cost and schedule baselines. A project plan includes at least other plans for issue escalation, change control, communications, deliverable review and acceptance, staff acquisition, and risk management.
IV&V Contract & Reports / “Independent verification and validation (IV&V)” means the process of evaluating a project to determine compliance with specified requirements and the process of determining whether the products of a given development phase fulfill the requirements established during the previous stage, both of which are performed by an organization independent of the lead agency. Independent verification and validation assessment reporting. The Department requires all projects subject to oversight to engage an independent verification and validation contractor unless waived by the Department.
IT Service Contracts / The Department of Information Technology and the State Purchasing Division of General Services have established a template for all IT related contracts.
Risk Assessment and management / The DoIT Initial PROJECT RISK ASSESSMENT template which is meant to fulfill the following requirement:
“Prepare a written risk assessment report at the inception of a project and at end of each product development lifecycle phase or more frequently for large high-risk projects. Each risk assessment shall be included as a project activity in project schedule.” Project Oversight Process memorandum
Project Schedule / A tool used to indicate the planned dates, dependencies, and assigned resources for performing activities and for meeting milestones. The defacto standard is Microsoft Project
Monthly Project Status Reports to DoIT / Project status reports. For all projects that require Department oversight, the lead agency project manager shall submit an agency approved project status report on a monthly basis to the Department.
Project Closeout Report / This is the Template used to request that the project be officially closed. Note that project closure is the last phase of the certification process
3.1.2 Product Deliverables
The product deliverable documents listed here are anticipated to be included in the project where applicable: