Best Practices when your Chart of Accounts is Changing
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The document discusses best practices for managing changes to the chart of accounts (COA) during financial planning and analysis system transitions. It highlights reasons for COA changes, including mergers and acquisitions, ERP transitions, and reporting inefficiencies, while providing technical guidance on remapping and reconciliation processes. The presentation also emphasizes the importance of considering the effects on historical data and offers insights into maintaining data integrity and optimizing system functionality during the transition.
Best Practices when your Chart of Accounts is Changing
- 2. 201.984.3030 | info@revelwood.com revelwood.com Analytics that impact. Best Practices When Your Chart of Accounts is Changing Session ID: FPM-1282 Presented by: Lee Lazarow FPM Technical Director, Revelwood IBM Vision 2017 Conference @Revelwood #IBMVision
- 3. 3 @Revelwood #IBMVision Introduction ▪Lee Lazarow ▪FPM Technical Director
- 4. 4 @Revelwood #IBMVision ▪ Award winning IBM analytics business partner specializing in FOPM, Predictive Analytics and Cognitive ▪ Hundreds of successful TM1 implementations over more than 20 years for both Fortune 1000 and mid-market companies ▪ Team of certified, experienced IBM Cognos TM1/Planning Analytics consultants ▪ Consultants have skill sets that combine both business acumen through direct Corporate Finance experience with technical prowess via hands- on experience implementing TM1 About Revelwood
- 5. 5 @Revelwood #IBMVision Session Agenda ▪Reasons for COA Changes ▪Things to consider ▪Examples
- 6. 6 @Revelwood #IBMVision Why Change the Chart of Accounts? ▪Acquisitions / mergers –No common COA –Can lead to addition of currency conversion ▪Moving to a new ERP/GL system –Each ERP has different features that will handle the business process differently … may impact the COA design –New chart of account structure needed to take advantage of full functionality –New modules implemented (example: Oracle Projects)
- 7. 7 @Revelwood #IBMVision Why Change the Chart of Accounts? ▪Can no longer efficiently generate reports –Over time, ran out of numbering codes –Codes no longer fit into pre-defined ranges –Same segments, different meanings by trying to make something fit ▪Can no longer support reporting and compliance requirements –Internal –External reporting needs
- 8. 8 @Revelwood #IBMVision Types of COA changes ▪Different segmentation –More segments • Potentially involves one-to-many (e.g., splitting) • Sometimes entails many-to-many (e.g., combinations) –Less segments • Typically entails many-to-one (e.g., merging) ▪Changes to elements (e.g., remapping) –Number of characters in the element code –Creation of new elements –New definitions for existing codes • In situations without a common COA, this is “new” for someone
- 9. 9 @Revelwood #IBMVision Beyond the GL ▪ERP implementation team most likely owns the remapping ▪But you own reporting … more to consider than just the GL Balances –Sub systems –Other systems that feed the ERP system –Detailed information stored in TM1/PA
- 10. 10 @Revelwood #IBMVision Beyond the GL (continued) ▪Consider all aspects beyond the GL –Customer codes –Product codes –Employee IDs –Asset numbers ▪And create master lists to ensure consistency –Code numbers –Descriptions –Attributes
- 11. 11 @Revelwood #IBMVision Historical Data ▪Easily forgotten - not always important to the ERP implementation team –Many projects only remap 1 or 2 years of history –Your system most likely has more than that ▪How much historical data to remap? –Can impact trend reporting, seasonal planning, budgeting ▪Definitions –Historical data may include new data points –Those data points need to be remapped
- 12. 12 @Revelwood #IBMVision Remapping ▪Where –Done in TM1/PA or in new source system? –May be a combination • Based on whether all TM1/PA data is in the source system ▪Storage –Keep pre-mapped data in TM1/PA? • Separate cubes on same server • Separate TM1/PA server
- 13. 13 @Revelwood #IBMVision Mapping Tables ▪If creating mapping tables in TM1/PA –Type of mapping • Cube vs. attribute • Use consistent approach –Load definitions from the new ERP • Don’t try to replicate rules –Assume there will be LOTS of iterations • Right down to the final go-live of the source system • Important to optimize the mapping processes
- 14. 14 @Revelwood #IBMVision Reconciliation ▪Start doing remapping and recon as soon as possible –Key SMEs see and sign-off on the data –Show data using the new chart –Many clients don’t see issues until they see their data in the new chart ▪Define an approach to reconcile –Reload mapping definitions –Rerun the mapping process –Re-reconcile
- 15. 15 @Revelwood #IBMVision TM1/PA Technical Aspects ▪Data load processes ▪Dimension build processes ▪Data source changes –ODBC –Cloud ▪Rules –Existing hard coded values changing ▪Security –Element vs Cell ▪Cubes and dims –Existing or new … or both
- 16. 16 @Revelwood #IBMVision Learning the new structure ▪Do not underestimate the importance of this –Or the amount of time it will take! ▪Project team –New COA definitions –New cubes –New business processes ▪End users –Train-the-trainer sessions –Web based documentation –Instructions directly on the input templates
- 17. 17 @Revelwood #IBMVision There are lots of new opportunities! ▪Report cleanup –Report re-creation is a key task during a COA change • Review existing reports • Determine which reports are truly required –Organize your reports • Must have reports • Nice to have reports • Reports that can be eliminated
- 18. 18 @Revelwood #IBMVision Opportunities (continued) ▪Cleanup your TM1/PA system –TI processes that are no longer used –Old subsets and views –New naming conventions ▪Create new functionality –New modules for anything not at the basic GL level –Drill through
- 19. 19 @Revelwood #IBMVision Opportunities (continued) ▪Redefine planning processes and requirements –Add or minimize the amount of details entered –Incorporate a more (or less) decentralized approach ▪Train users –Report creation and maintenance –Ad-hoc analysis –New tools (example: PAW) –Developer and Admin training
- 21. 21 @Revelwood #IBMVision Example: new segments (one-to-many) ▪Summary –COA restructure split an existing dimension into three new dimensions ▪Issues –One-to-many remapping; some data only in TM1 ▪Resolution –Two TM1 servers –Rebuilt all cubes –Remapped data –Security
- 22. 22 @Revelwood #IBMVision DrillDrill Example: using TM1 to reconcile ▪Summary –Client was looking for an easy way to reconcile existing TM1 data into new COA ▪Issues –Lots of remappings and many users made reconciliation difficult ▪Resolution –Created/used three cubes –Data –Drill through processes created
- 23. 23 @Revelwood #IBMVision Example: new ERP module ▪Summary –New Projects module added to the ERP ▪Issue –Wanted to plan and report at more detailed level ▪Resolution –Used existing core finance model to remap, as normal –Then added a new detailed module into TM1 • Linked new model into core model • Create new imports/exports • Create drill through functionality from Finance into Projects • Create new detailed input templates and reports
- 24. 24 @Revelwood #IBMVision Example: temporary approach ▪ Summary –Merger happening faster than accounts could be remapped ▪ Issue –Wanted to report immediately using two separate account charts ▪ Resolution –Analyzed existing structures • Different number of segments • Found repeated accounts with different meanings –Rebuilt account dimension • Merged both sets of existing accounts • Developed consistent hierarchy structure –Remapped one set of data into “holding” elements (e.g., 0000)
- 25. 25 @Revelwood #IBMVision Industries we have assisted ▪ Advertising ▪ Automotive ▪ Banking / Financial Services ▪ Education and Learning ▪ Government / Public Sector / Non-Profit ▪ Health / Pharmaceuticals ▪ Insurance ▪ Media and Entertainment ▪ Oil, Energy and Gas ▪ Real Estate / REITs ▪ Various Distribution and Retail industries ▪ Various Manufacturing industries
- 26. 26 @Revelwood #IBMVision Quantum is a FREE mobile app for Administrators to manage their TM1 environment. ▪ View server statistics, Message Log, Transaction Log and Threads. Kill a Thread. ▪ Activate and Run TI Chores and Processes. ▪ View and modify Users and Groups. Modify Group assignments. ▪ Reset user passwords. Quantum is available on Android and iOS devices. Download "Quantum for TM1" from Google Play or the Apple App Store today! Lightspeed is a complete FP&A solution with out-of-the-box functionality and customized modules to meet the individual needs of your organization. ▪ Pre-built intelligence including P&L, balance sheet, cash flow, revenue and expense planning with supporting line-item detail, staff planning, capital planning, allocations, currency translation, workflow, navigation and more ▪ Customer-driven best practices built on more than 20 years of experience from hundreds of implementations across all industries ▪ Rapid ROI for a fast, flexible and immediately useful solution that accelerates enterprise planning and reporting deployments
- 27. 27 @Revelwood #IBMVision Closing ▪By considering the impact of your COA structure changes on your FP&A system, you will have a much more successful project ▪Grab a “Top 5 Tips” handout ▪COA blog post - http://bit.ly/2pV1sry ▪Contact us - we can share our best practices and client stories to make your transition as easy as possible!
- 28. 28 @Revelwood #IBMVision Questions? Lee Lazarow FPM Technical Director, Revelwood info@revelwood.com http://knowledgecenter.revelwood.com/ Follow us:
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