Roche Group Reporting Process Systems at a glance Alexandre Mary – Group Reporting & MIS April 11 th , 2013
Roche Group Reporting Process
Systems at a glance
Alexandre Mary – Group Reporting & MIS
April 11th, 2013
Overview & background
Local closing process
Headquarters closing process
From theory to practice: system implications
Current projects & next challenges
3
Fast Close
Project Objectives
Speed up the close process
• From 20 work days to 5 work days
• Accelerate external reporting by 3 weeks
Improve data quality
• Right first time
Implement for all reporting events by early 2003
• Monthly, quarterly, year-end
Improve knowledge transfer throughout global finance network
• Best practice sharing
4
Fast Close
Business Benefits
Facilitates fast response to business developments
• Provide better and more timely information to management throughout
the company
Strengthen business support from Finance
• Free up resources for more value-adding analysis and support
A necessity, not a luxury
• Better data quality at source and all aggregated levels
• Streamline and reduce cost of finance systems and processes
Strengthen reputation with the finance community
• Satisfy expectations of the capital markets (investors, analysts)
• Demonstrate disciplined financial management
5 Cut-Off Month End
Previous
Process
New
Process
Key
features
of the
new
Process
WD 8 WD 20
WD 3 WD 5
Preparation Local
Close Consolidation
Data
• Standardised
monthly
data set
• Additional
quarterly data
for external
reporting
• No „early close‟
Quality
• Strict adherence to
Group guidelines
• „Right first time‟
• Quality
Management
• Training
• New concept
External Audit
Systems
• Web-based system
for Group reporting
and consolidation
• Automatic interface
from local SAP
systems
• Automatic
inter-company
matching
Process
• Transmission WD 3
6 p.m. local time
• Rules for holidays
• Discipline
• New HQ process
• Monthly process
reviews
• Best practice sharing
Late
Transmissions/
Corrections
Fast Close
Key features of the new process
Fast Close
Key principles
No early close
Right first time
Extra day for public holidays in 6 key countries
Strict adherence to due dates
19 April 2013 6
WD 3 Block A Balance sheet
Income Statement
Movements
IC relations
WD 3 Block B Credit & liquidity risks
WD 4 Block C Supplementary year-end disclosures
J F M A M J J A S O N D
A A A A A A A A A A A A
B B B B
C C C
B
Fast Close
One standard reporting package
7
Group Reporting Process Flow
One-step consolidation
Group Consolidation
(SAP FC - Magnitude)
Group Executive
Information System
Divisional reporting
system(s) Divisional
information
Accounting
Data collection &
validation
Consolidation
Reporting
Core data
Group Finance data
ODG data (on request)
ODG data
(Core data)
Local transaction systems
(mostly SAP R/3)
Interface (SAP R/3)
19 April 2013 8
Overview & background
Local closing process
Headquarters closing process
From theory to practice: system implications
Current projects & next challenges
Roche Finance Core Standardization of master data
• Ensures that FGA (Financial Group Accounting) rules and accounting principles
(IAS, IFRS) are implemented in SAP systems, by translating them into SAP rules
and definitions.
• Ensure efficient reporting of financial data, by enabling the extraction of reporting
data from local SAP systems through the SAP GRC interface
• Provide sound basis for further initiatives, support global group wide or cross
divisional processes, a fundamental basis for further standards (Pharma and
Diagnostics Core, Treasury Core)
• Ensure consistency of widely used Finance master data
• Ensures implementation of the same solution for the same problem
• Compliance through quarterly central reviews and local self assessments
10
Group Reporting of Actual Data
Separate events
Balances in ICMS (Inter-Company Matching System): due at 5 pm on
WD 1
Monthly Flash Sales: due at 6 pm on WD 1
Financial Reporting: due at 6 pm on WD 3 (WD 4 YE)
IC
MFS
FR
Narratives Reporting: due at 6 pm on WD 4 (WD 5 YE), only selected companies for Dia division, quarterly basis
NAR
Deadlines based on local time
11
12
• Available for monthly actual reporting in Magnitude (FR & ICMS)
• Covers about 80% of the requirements
• Mandatory for all Roche affiliates with SAP ERP in place
• ABAP coding, developed and maintained centrally by Group Functions IT
• Roche Core compliance is a pre requisite
• The extraction does not manipulate or change the data
• The local company remains responsible for the data
Automated extraction from SAP
Characteristics
Overview & background
Local closing process
Headquarters closing process
From theory to practice: system implications
Current projects & next challenges
198
companies
report;
~50,000
data
6 August, 6pm 8 Aug, 2pm
Consolidation
meeting
Translation to CHF
Inter-company elimination
Group entries
Data validation
Consolidation
8 Aug, 5pm
Executive
Information
System;
HQ reports &
presentations
14
Fast Close
Roche’s state-of-the-art monthly process
days 4/5 day 11 day 3
16 Aug
Reporting
Quality
(traffic
lights)
Process
dashboar
d
Post
closing
meeting
Process monitoring
220 tasks
15
Fast Close
Roche’s state-of-the-art year end process
Process monitoring
~1,500 tasks
198
companies
report;
~65,000 data
7 January, 6pm
day 7 day 11 day 16 day 20 day 9 day 19 day 4
Translation to CHF
Inter-company elimination
Group entries
Data validation
Consolidation
10 Jan
Consolidation
meeting 1
Audit
P&L, B/S
C/F
12 Jan
Consolidation
meeting 2
14 Jan
Executive
Information
System;
HQ reports &
presentations
21 Jan
Finalise external report
including audit
CEO/CFO sign off
Audit Clearance
Prepare draft
external
report
Review by
Audit
Committee/
BoD
24 Jan
Audit Comm/
BoD
25 Jan
Reporting
Quality
(traffic
lights)
Process
dashboar
d
Post
closing
meeting
16
Process Monitoring
Runbook –live since July 2010
Good monitoring capabilities for
department heads
Tailored views per department/user
Easy ticking-off of tasks (also called
steps)
Multi user capabilities (including refresh
function) and real time information
Easy to maintain step list
Change log for every step
ICFR control descriptions attached to
steps
Fast Close
What gets measured gets done
Timing - Monthly Financial Reporting
- Monthly Inter-Company Reporting
- Monthly Flash Sales
Data - Re-Transmissions
Quality - Corrections
- Matching of Inter-Company
Balances - Roche Core Compliance
- Use of SAP/GRC Interface
Quality
Metrics
Monthly
Financial
Reporting
Good
Fair
Not acceptable
Need to improve
Overall
Score %
2010
100
2009 2003 2002 0
17
Overview & background
Local closing process
Headquarters closing process
From theory to practice: system implications
Current projects & next challenges
System landscape
Global architecture overview – relevant systems
Frontend
BI
Reports/
Data Mart
Data
Warehouse
Layer
Informatio
n Source
Layer ERP / SAP
Environment
Non SAP
CPM
Appli
-cations
TM1
Pharma+Grou
p
SAP BOFC Magnitude
EIS ROFIS
IPE
CEMA
I
Commercial
s COGNOS
Custom
Extraction
Lifecycle DW
Commercials
Dia Dashboards
Business plan
DIS
DIS
FGA
R
COCO
S
Planet
HQ BW P74 Group
COP
A
SPRIN
T
FRAM
E MO
Royalty
Perform
MGR
TM1
Dia
IDW: Integrated DataWarehouse (BO reporting) CPM: corporate performance management IPE= intercompany profit eliminations
Regional
BWs
Regional
BWs
IDW MIP
GCM
R
Financial Group closing and reporting in a nutshell…
• We make sure that fast close remains a success by providing:
– A standard SAP extraction tool to all our SAP sites
– A specific support to non SAP site to provide group data
– A central web based consolidation tool to collect financial data for about 200 affiliates WW (SAP BOFC= Magnitude)
– A global support on a 24 hours basis during reporting (Basel, Australia, SSF)
– A robust and flexible reporting & consolidation engine that supports all management needs (i.e. deconsolidation, M&A, simulations, new IS presentation,…)
– Easy ad-hoc access to data for power user (Excel)
– An integrated BI platform for top managers currently mainly developed in the Executive Information System (EIS)
– Consultancy services to our finance business partners for new initiatives, changes and projects where our solutions or others could help ( incl. customisation, maintenance & training)
We are currently 6 experts managing 3 applications.
We support approx. 860 users (of which 700 are local and 160 are headquarter users) 20
MS SQL Server 2005
Reporting tools
- EIS (internal) + ROFIS (external)
- Arcplan Special Analysis
- power users’ Excel analysis
- NEW: BO Enterprise tools
•Cube Analysis
Power Users
Reports
•Pivot Table
Other Systems:
Divisional SAP-BW, Excel
Magnitude
GRC
SAP BOFC
SSAS
Cube
Arcplan special
analysis
and downloads
Cockpit
Dynasight
EIS
Magnitude Internal Interface:
- cube creation
- partition creation
(one partition / consolidation)
- data transfer
Financial Group closing and reporting Fast Close in 5 days powered by high-performing applications
xll
Standard
Reports
SAP
R3
SAP
R3
Non
SAP
Cut-Off Month
End
WD 3 WD 5
BOFC Extended
Analytics (EA) Universes
Infoview, Webi, Xcelsius,
LiveOffice + ROAMBI (mobile)
21
All Group Finance Reporting is currently collected and processed using Magnitude
Abr Name Due When Data Entry
MFS Flash Sales Reporting M WD1 Sales by ODG
IC Intercompany Reconciliation M WD1 IC by CP by TC
FR Monthly Financial Reporting M WD3 Full Actuals group + sub consolidations
NAR Narratives for FR Q WD4 FR Comments
RF Rolling forecast (incl. FF, STA & NAR)
Y Target confirmation T0
MO Monthly outlook M WD-2 Only ODG and PU entries – no local affiliates
STA Statutory fiscal reconciliation Q
TAX Tax reporting Y
INS Insurance reporting Y
US US IFRS reporting Y RHI US consolidation
SUST Sustainability reporting Y Information on donations, sponsorship
OCC Occupancy cost reporting Y Information on buildings
RO Data repository Y Data storage for external publications
BP Business Plan Y In migration to TM1
Finance reporting events hosted on Magnitude One platform for all group data…
This helps to maximise efficiency and ROI of our current platform
Data is also available on our Microsoft cubes for ad-hoc analysis 22
Information systems to visualise data
Roche Finance System & the EIS in brief
The Roche Finance Information System (ROFIS)
• interactive tool that enables investors interested in Roche to
access and download key financial data easily.
• ROFIS is public and is accessible on internet.
• ROFIS is also mobile
The Executive Information System (EIS)
• reserved to Roche Top Executive Management (70 users)
• offers a broad range of financial figures and qualitative data
• helps managers in their financial review
• covers different modules like Sales, Financial results, a
dashboard and a value creation section.
• provides global picture on group financials on intranet. 23
Overview & background
Local closing process
Headquarters closing process
From theory to practice: system implications
Current projects & next challenges
Management information systems
Vision & goals
Management information is distributed over several systems
No capabilities for mobile reporting
Limited usage of Single Sign On
Constant push for efficiency
Single landing page for
- Finance information Group and
Divisions
- Homogeneous frontend
- Seamless information integration
Mobility
- Management report on common
mobile devices (iOS + Blackberry)
Leverage
- Integration of management
information systems in BO architecture
- common approach btw. divisions
- Possibility to integrate further Group
finance reports, e.g. Treasury, Taxes etc.
- Optimise disclosure management
processes.
Current situation Several projects will enable
25
Integration to SAP portals is in progress…
Objective:
• One central source of
information for our
finance end users
• Maximise usability for
end user
27
Management information systems
Mobility concept
Goals
– Enable reporting on mobile devices (iPad, iPhone,
Blackberry)
– Enhance flexibility and accessibility of management
information
Content
– Sales and Results Information (Actuals, Forecast and
Monthly Outlook)
– Competitor data
Approach
– Joint approach with Pharma Medicines
– Business Objects and ROAMBI used as system
environment
– Roll-out started in 2012
– SAP Mobile will be looked at in 2013.
28
How it works…
Mobility concept
• Create
• Customize
• Publish
•Distribution
• Integration
• Security
• View
• Interact
• Share
Your Existing Enterprise BI System
The Roambi Publisher The Roambi Server The Roambi
Views
Existing BI Systems
• Create
• Customize
• Publish
• Distribution
• Integration
• Security
• Interact
• View
• Share
29
V10 migration project: a first step to the future
Macro plan
1. Find out if we can get a virtual environment April 2012
– @ SAP or
– @ Roche (Vmware)
2. Get support of SAP and clarify roadmap for EPM suite May 2012
3. Analyse the benefits of new functionality in V10 May 2012
4. Analyse integration capabilities with BW and SAP (eg FIM is now part of the offer if you
connect exclusively to SAP products) August 2012
5. Analyse BO Xi 4.0 vs 4.1 FGI decided 4.0
6. PoC V10 and FIM 10 August 2012
7. Decide on Migration in 2012 with STC Dec 2012
8. Migrate to V10 if tests successful March 22nd, 2013
30
V10 migration
Introduce an agile server architecture
Server role
Total sum of current resources
Productuon only)
Total sum of target resources
Production only) Total number of
concurrent
users Cores RAM (GB) Number of
servers
Server
type Cores RAM (GB)
Number of
servers
Server
type
Terminal Services
8 8 2 Virtual
8 24 2 Virtual < 40
8 4 1 Phyical
Application BFC 16 56 4 Physical 16 64 4 Virtual < 100
Web BFC 8 8 2 Physical 8 16 2 Virtual < 100
Microsft SSAS 12 16 1 Physical 24 52 2 Physical < 50
Microsoft SQL Server/SSAS 16 52 2 Physical NA NA NA NA NA
Microsoft SQL Server NA NA NA NA 48 104 4 Physical
Application & Web DS/FIM NA NA NA Physical 16 32 1 Virtual < 50
BFC Application & Web Development 4 4 1 Physical 4 8 1 Virtual < 20
CtBroker BFC, BOE or BI 8 12 2 Physical 8 16 2 Virtual < 100
TOTAL 80 160 15 NA 132 332 18 NA < 100
29 servers will be decommissioned
First time usage of virtual environments to enable better agility 32
V10 migration: Target landscape
KAISERAUGT Site (RECOVERY)
S
2 Terminal Services
Servers, SAP BFC 10.0,
CDC Designer 10.0 & MS
Excel 2010, EPM Addin
for Office 4 VPCPU 3
GHz RAM 12 GB
FW
S
S
R LAN/WAN
R
TS Citrix clients
512 MB of RAM IE 7.0
BASEL Site (PRODUCTION)
S: Switch,
R: Router,
FW: Firewall
Web and Excel Users
1 GHz 512 Mo RAM
R
S
AUDITPROD
CMSPROD
FIMPROD
SAP BO FIM 10.0 & DS
4.0 (Production) 4 VCPU
3 GHz RAM 8 GB
2 serveurs SAP BFC 10.0 CtBroker (Cluster MS), IPS
Native SAP Cluster), Files Share, EA Plugin, DS Plugin
4 VCPU RAM 8 GB
SAP BFC 10.0
(Development)
4 VCPU 3 GHz RAM
8 GB
SAP BO FIM 10.0 & DS 4.0 (Test)
4 VCPU 3 GHz RAM 8 GB
3 Application servers in Load balancing mode, SAP BFC 10.0, ActivePDFServer 2009 R2 SR3
4 VCPU RAM 16 Go (Production)
4 Physical servers MS SQL Server 2008 R2 SP1 Standard Edition US Version in Geo Cluster mode 2 CPU (6 Cores) RAM 26 GB each
2 Physicalservers MS Analysis Services 2008 R2 SP1 Enterprise
Edition US Version in Geo Cluster mde, EA UDF For Security,
MS Datapump, EA Deployer 2 x CPU (6 Cores) RAM 26 GB
BFCPROD TopParam DSPROD CMSTEST
AUDITTEST
BFCEST
FIMTEST
BFC Databases
FIM Databases
DS Databases
1 server SAP BFC 10.0 CtBroker (Cluster
MS), IPS, Files Share, EA Plugin, DS Plugin
4 VCPU RAM 8 GB
1 Cisco Web Load
Balancer for FC & FIM
2 Web servers
SAP BFC 10.0 ,
IIS 7.5 , 4 VCPU 3
GHz RAM 8 GB
2 Terminal Services
Servers, SAP BFC 10.0,
CDC Designer 10.0 & MS
Excel 2010, EPM Addin
for Office 4 VCPU 3 GHz
RAM 12 GB
2 Web servers
SAP BFC 10.0 ,
IIS 7.5 , 4 VCPU 3
GHz RAM 8 GB
All servers will use Windows 2008 R2
Server Standard Edition US Version
unless the clusterised ones that will use
tehEnterprise Edition (Serveurs SQL
Server, SSAS & CtBroker servers). The
other exception is on the Terminal
Services servers that remain on
Windows 2003 Standard Edition
1 Cisco Web Load
Balancer for FC & FIM
IPS Databases
3 Application servers in Load balancing mode, SAP BFC 10.0, ActivePDFServer 2009 R2 SR3
4 VCPU RAM 16 Go (Test)
33
Why do we want to use FIM?
Leverage new capabilities of our SAP landscape
• TODAY we are using a custom interface to retract data from local SAP
• TODAY we extract data from Magnitude in flat files and transfer data via ftp to both
DIS and FGAR cubes.
• TOMORROW we could use a native interface from SAP to extract data from local
SAP.
• TOMORROW we could feed data from Magnitude directly to BW without
cumbersome files transfers.
• TOMORROW we shall have a better integration and overview on the extraction,
transformation and loading of the actual data.
• TOMORROW these interfaces are fully insourced and part of the SAP suite (no
additional costs anymore as free of charge if connecting to SAP data sources) 34
FIM 10 Proof of Concept
What did we do with SAP?
Support
We got 3 days of support from SAP to:
1. Establish the “INPUT” connection to an ERP system (e.g. TOP)
2. Establish the “OUTPUT/INPUT” connection to a BW cube
3. Understand how we could potentially replace / enhance our SAP Magnitude Interface
4. Understand how we can replace our current FTP process with a direct link to BWs
TO DO for us:
Define plan of the SAP intervention
Who is going to work with SAP?
Which time?
How do we organise ourselves?
35
FIM 10 PoC: Target Landscape
S
1 Terminal Services Servers, SAP
BFC 10.0 , CDC Designer 10.0 &
MS Excel 2010, EPM Addin for
Office 4 VCPU 3 GHz RAM 8 GB
FW
S
S
R LAN/WAN
R
TS Citrix clients
512 MB of RAM IE 7.0
S: Switch,
R: Router,
FW: Firewall
Web and Excel Users
1 GHz 512 Mo RAM
R
S
AUDITPOC
CMSPPOC
FIMPOC
1 Server
SAP BFC 10.0 CtBroker (Cluster MS), IPS ( Native SAP
Cluster, Files Share server, SAP BO FIM 10.0 & DS 4.0, EA
Plugin, DS Plugin
4 VCPU RAM 8 GB
1 application server, SAP BFC 10.0,
ActivePDFServer 2009 R2 SR3
4 VCPU RAM 8 GB
2 existant MS SQL server 2005 SP4, MS Analysis Services 2005 SP4, Enterprise Edition US Version in crossed mode cluster, 2 x CPU (4 Cores) RAM 26 GB
GRC_PROD
GRC_DEV
DSPROD
BFC Databases
FIM Databases
DS Databases
1 Web server
SAP BFC 10.0 ,
IIS 7.5 , 2 VCPU 3
GHz RAM 4 GB
All servers will use Windows 20 08 R2
Server Standard Edition US Version
unless the clusterised ones that will use
tehEnterprise Edition (Serveurs SQL
Server, SSAS & CtBroker servers). The
other exception is on the Terminal
Services servers that remain on
Windows 2003 Standard Edition
IPS Databases
1 Server
BFC 10.0 CtBroker (Cluster MS), IPS ( Native SAP Cluster,
Files Share server, EA Plugin, DS Plugin
4 VCPU RAM 8 GB
36
FIM 10 today
Open items & planned deployments
• Install BFC 10, BOE Xi4.0 and FIM 10
• Install client tools for BOE Xi 4.0
• Install client tools for BO Data Services and FIM
• Go live new platform V10 March 25th
• Integration steps with Pharma BW P74 team April –June
– Redefine process of extraction and mapping
• For local data AS IS versus TO BE scenaris
• For consolidated postings AS IS versus TO BE scenaris
– Establish recommendation of new process
– Build & test processes
• Integration steps with Dia BW DIS team Q4 2013
• Integrarion with SAP R3 Interface Q3 2013
37
39
Addressed pain points
• Consistent conventions, design, layouts and formats
• Rounded financials transparent for all involved
• Availability of rounded numbers in financial reports
• Ticking effort to decrease significantly
Process improvements
• Elimination of iterations, reconciliations and manual process steps between FCM
and FCAC
• Opportunity to streamline, reorganize and optimize FCAC report.
• One source of truth
• Elimination of most of the manual populating steps in the financial review,
financial statements and notes
Disclosure management
Phase 1: where we started and first benefits
40
• Phase I, i.e. the redesign of the Finance Report Excel module and the data repository,
is the pre-requisite for phase II of the “last mile”
• Phase II comprises the steps from consolidated financial figures to the printed
finance report
• Next steps
– Explore alternatives to fully resolve the “last mile”
– Explore possible disclosure management solutions (incl. SAP Disclosure Management 10)
– Explore collaboration with Group Communications (NS.Publish in use)
– Propose approach in next SC meeting in December postponed !
Disclosure management
Next steps
Local close Consolidati
on
Design,
printing
The “last
mile”
Perspectives: HANA and Magnitude
A brief overview of our expectations
• Content and benefits :
– Virtual cubes allows major performance improvements in the data retrievals
– Performance improvements in the consolidation processes
– Less performance gains on the data collection part to be expected
– Technology will allow to build views directly accessible in BWs running with
HANA without replicating data in separate BW cubes.
– Avoids creation of redundant data in multiple cubes
• Our position:
– Continue to get regular updates on progress made
– Proposed to participate to tests as soon as package is ready
this PoC will be included as a follow up to V10 migration project
42
Summary: Delivering the performance
management promise by…
• Simplified & harmonized IT landscape with single point of maintenance – SAP Financial Consolidation
• High flexibility and reactivity to new business needs thanks to internal expertise
• Better data quality
• Objectives given by Roche Management to FAST CLOSE were achieved
Earlier information delivered to management: WD 6
Quicker management response to changing market (e.g. Opex reporting or global issues)
Earlier information to the market: we are in the top tier of global healthcare companies in term of reporting speed
• Closer integration to SAP environment thanks to future FIM and HANA projects
43