Automating Automating Governmental Budgetary Governmental Budgetary Accounting in Oracle Accounting in Oracle Federal Financials Federal Financials A Case Study A Case Study
Automating Governmental Automating Governmental Budgetary Accounting in Budgetary Accounting in
Oracle Federal FinancialsOracle Federal FinancialsA Case StudyA Case Study
What Will I Learn Today?What Will I Learn Today?
• How budgetary accounting works in Oracle Federal Financials
• Why Oracle Federal Financials has inherent governmental accounting limitations
• How to automate and validate the Transaction Code selection process, which drives federal Standard General Ledger (SGL) budgetary accounting
Presentation OutlinePresentation Outline
• Background
• Issues
• Contributing Factors
• Agency Requirements
• Solution Details
• Solution Examples
• Questions
Audience Participation - Audience Participation - EncouragedEncouraged
Who here is currently facing edit issues at their agency?
Definition of TermsDefinition of Terms
• SGL (Standard General Ledger) – The US federal government mandated natural account
• Transaction Code (TC) – Code used by Oracle Federal Financials to drive dual entry governmental accounting. The TC designates the SGL legs
• AFF – Accounting Flexfield, chart of account segment values used in every accounting transaction
Definition of TermsDefinition of Terms
• Funds Checking (Reservation) – A process by which specified transactions cannot reduce their respective summary account balances below $0– i.e. Every purchase is verified to ensure that a
budget is not overspent
• LOV (List of Values) – Oracle form feature that limits a selection for a particular field
BackgroundBackground
• Absolute Budgetary Control via summary templates
• Budgetary SGL Accounting driven by Transaction Codes (TCs)
• TCs specify the government mandated dual entry accounting
IssuesIssues
• Limited validation checks to catch or prevent incorrect accounting entries
• ‘Edit Checks’ performed after the fact via reporting
• Audit concerns
IssuesIssues
• Errors in accounting not discovered until entered in the system
• Time consuming fixes for Accounting Errors
– “After the fact”
Contributing FactorsContributing Factors
• Process design limitations– Performs combination and balance edit
checks, not upon entry / interface, but after the fact
Contributing FactorsContributing Factors
• Oracle Federal Financials limitations– Uses account generator to automatically
populate the proprietary AFF based upon pre-defined rules. However, the dual entry budgetary requirements of federal agencies rely on the manual selection of the proper transaction codes by users.
Contributing FactorsContributing Factors
• Oracle Federal Financials limitations– TCs not required within the forms, but
necessary for funds checking and budgetary (dual entry) accounting
– Cross Validation Rules not checked against the TC legs
– TCs modified after transactions have already been accounted and interfaced to the GL
– Enhanced Transaction Codes still required users to select the correct TC
Contributing Factors - User DrivenContributing Factors - User Driven
• User driven limitations– How does a typical user know the proper TC
for budgetary accounting?
Issues - ExamplesIssues - Examples
• User can enter an Obligation (PO) and leave the TC blank. If the TC is blank, then funds checking does not occur.
• It is possible to obligate more than what is allocated
Issues - ExamplesIssues - Examples
• User can select an improper TC whose SGL legs violate a cross validation rule
• Unless these issues cause a lack of funding, incorrect accounting can occur
Issues - ExamplesIssues - Examples
• The user can select the wrong TC and initiate incorrect budgetary accounting
Agency RequirementsAgency Requirements
• Standardize TC usage (budgetary SGL accounting) across the agency
Agency RequirementsAgency Requirements
• Prevent incorrect accounting at the point of entry, whether it be a user form or interface
Agency RequirementsAgency Requirements
• Provide a means to determine the correct budgetary accounting without user intervention
Agency RequirementsAgency Requirements
• For TC decision points, limit the TC LOV to only the applicable TC values
SolutionSolution
• The account generator populates proprietary accounting for the user
• How can we streamline the TC selection (budgetary accounting) process for users who have little knowledge of SGL accounting?
SolutionSolution
• For example, in a Purchase Order obligation, if the fund is 00500 (General Fund), then the only possible TC is ‘Obligation-Reg’
• Why can’t we auto-populate the TC with “Obligation-Reg?”
• The “Obligation-Reg” TC drives the budgetary natural accounts– DR 461013– CR 480100
SolutionSolution
• Define agency wide rules for TC usage
• Rules are based on…– Transaction Type (i.e. Requisition, Obligation,
AP Invoice, AP Payment, AR Invoice, AR Receipt)
– Fund (i.e. 00500)– Object Class (expense type)
SolutionSolution
• Create a custom form and table to hold the TC rules
• The form is user maintainable as needs (rules) change
SolutionSolution
• TCs required on all forms
• Forms populate the TC once the requisite information is in place
SolutionSolution
• For example, once the AFF populates based on the account generator, the TC automatically populates
• The TC cannot be modified once a transaction is accounted for and interfaced with the GL
SolutionSolution
• Set up CVRs to restrict incorrect AFF combinations
• Validate (form enhancement) the TC legs against the cross validation rules
SolutionSolution
• Interfaces also use the table based rules to determine the correct TCs
• If the TC cannot be found due to a gap in the TC rule definition, an error message displays – sometimes occurs with new funds
SolutionSolution
• TCs autopopulate on the following forms– Purchase Order– Requisition– PO Receipt– AP invoice– AP Payments– AR Invoices– AR Receipts– Treasury Confirmation
Solution – Technical DetailsSolution – Technical Details
• The CUSTOM.pll is a form enhancement that does not require the customization of the underlying form. The CUSTOM.pll is called during several triggers from every Oracle form
• The usage of the CUSTOM.pll isolates these enhancements from future upgrades
Solution – Technical DetailsSolution – Technical Details
• Creation of a PL/SQL function that accepts attributes from the form / interface (such as transaction type, fund, object class) and returns the TC value
• Function calls from the forms via CUSTOM.pll and interfaces
Solution – Technical DetailsSolution – Technical Details
• Creation of a single custom form to allow the modification of TC rules
Solution BenefitsSolution Benefits
• Takes budgetary account (TC) selection out of user’s hands – Improved data accuracy
• Provides up-front validations that limit audit and reconciliation issues
• Increases financial statement reporting accuracy and timeliness
Solution BenefitsSolution Benefits
• Decreases number of errors per month edits per month by 80%
• Improves audit results
• Drives Agency – wide budgetary accounting consistency
QuestionsQuestions
Bryan EckleBryan EckleSummit2Sea Consulting, LLCSummit2Sea Consulting, [email protected]@sum2sea.comwww.sum2sea.comwww.sum2sea.com