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01. 03. 2011

Finance Planning

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ApplStream® BPL System for Financial Planning Integrated with Oracle E-Business Suite in KOMTERM.

After our experience with planning for 2010, when it came to light that the current system in its given form was not satisfactory, our Company started to consider a new shape of planning. The task given by the Company management was: to ensure a unified system for the plan setting with a uniform structure for all parts of the Company.

 

“There were two variants available”.
To invest into the current management information system, which served for economic results reporting and for planning. This system served to the controlling team only due to a small number of licenses. The controlling department collected data from individual responsible persons in MS Excel and then re-entered data manually into this system.  Such investment would be aimed at the system technology to make it accessible for a wider range of employees.

To plan directly in individual modules of our Oracle EBS information system without the need of further investments. An obstacle for such a solution was the necessity to teach individual users up to four different procedures of plan entering depending on whether they would plan labour costs in the HR module, plan of repairs in the Service and Maintenance module, financial expenses in the General Ledger module and other expenses and revenues in the Project module.  This appeared to be a too big problem, although modules have a common basis, namely a defined accounting string.

At that time ATTEYA Group introduced to us the BPL solution for finance planning. A reporting system ApplStream® of ATTEYA has been implemented in our Company two years ago and we have got very good experience with it.
The basic shape of the introduced BPL solution fulfilled our general requirements for planning, where structural elements of the system were:

–  a budgeting item firmly linked to the accounting string (in our case it’s company–department–project–task–account–facility)
–  the budgeting item description
–  a user comment to individual budgeting item
–  so called detailed item (a possibility to produce a further break down of budget item under the same accounting string)
–  individual budget periods (a monthly period)
–  access rights to data according to individual user groups (two levels of access – to individual plans and individual departments)
–  plan versions
–  Work Flow during an approval process
 


An interface between BPL and Oracle EBS with the help of API functions had to be designed for further use of plan information (alerts on exceeding the plan, information on budget utilization, …). The download of data is performed after a full completion of planning and approval of individual plans in BPL.
The structure of plans (rules limiting accounting strings) was defined and they were generated (according to responsibility for a specific area of planning), e.g. wage plan, overhead costs plan, utility costs plan, etc., during the implementation.  Access rights were assigned to 50 users.
Upon generating the plan we found out that we could not use the current table of accounting strings combinations, so a new table with approximately 17 millions accounting string variations was generated based on rules set by the controlling department.  An individual plan is created by generating a table, which contains only those accounting strings, which comply with defined criteria, e.g. labour cost plan contains only variations, which have class 52x cost accounts in their “account” segment.
It appeared during practical planning of 2011 that we used only approximately 100 thousand variations of accounting strings from this table, and so we will try to simplify the table for the next year. In our case the number of variations is caused by a wide organizational (= cost) structure and by a number of individual projects.  The size of the table consequently influences the speed of final generation of plans, e.g. in the case of omission of some accounting strings.

The planning process for 2011 took approximately 3 months within the Company and can be considered a very successful.

Due to a simple use of the BPL and their knowledge of the current ApplStream® solution users had no problem to learn how to set the plan.
We managed to unify the structure of individual plans across all departments, plants and companies.
Currently we have planned data downloaded into four modules in Oracle E-Business Suite. In the General Ledger module they serve to us for comparing the plan and reality of financial statements (the profit and loss statement, the balance,…). In the HR module for comparing the plan and reality of labour costs. We have set evaluating reports above Projects and Service and Maintenance modules in the ApplStream® portal.

Article by: Ing. Hanka Ježková
Head of Information Systems, KOMTERM, a.s.

 

 

 

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