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How Do I Love Cash Flow? Let Me Count the Ways…

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Alithya
Alithya

This document discusses best practices for configuring and implementing a cash flow statement framework in Oracle Hyperion Financial Management (HFM). It provides an overview of key concepts like dimension configuration, data loading and mapping, calculations, and reporting. The presentation covers the indirect cash flow method and how the framework facilitates translation and eliminations at low levels.

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How Do I Love Cash Flow? Let Me Count the Ways…
How do I love Cash Flow? Let me count the ways… Geordan Drummond
Agenda • Introductions • Framework Recap • Dimension configuration • Data loading and mapping • Data input • Calculations • Reporting • Q&A
Introductions • Customer – Lincoln Financial Group • Enterprise Administrator • HFM Administrator • Vendor – Hyperion / Oracle • HFM Consultant • Partner – Alithya • Consultant (Consolidation, Account Recs, Tax, Reporting) • Close and Consolidation Product Manager • Financial Close and Consolidation certified • Narrative Reporting certified • Oracle ACE
Recap of the Cash Flow Framework
Recap of the FCC Cash Flow framework • This presentation covers the Indirect Method, although Direct Method is also possible • Main concepts: • Instead of picking and choosing selected items, the entire Balance Sheet is considered for the statement • The classification of activity in the Balance Sheet is intrinsic to the generation of the statement • Adjustments can be made for additional detail • The change in Cash for the period is the inverse of the net Balance Sheet activity excluding Cash • All activity is recorded at the lowest level of the organizational structure, which facilitates other impacts like translation and eliminations
Recap of the FCC Cash Flow framework • Movement dimension • Two main hierarchies are mirror images of each other • Level 0 members are shared • Movements hierarchy • Rollforward structure • Activity • Cash Flow hierarchy • Follows the statement presentation and groupings • Takes signage into account (Add/Sub on members) • Cash Change • FX • Cash Open/Close • Closing Balance Variance (not for C/F but used for validation)
Recap of the FCC Cash Flow framework • Account dimension – Balance Sheet • Primary hierarchy – Reporting • Secondary hierarchy – Cash and Non-Cash • Supplemental members outside of these hierarchies may be useful for disclosure based rollforwards • Custom dimensions (optional) • Not required but sometimes helpful • Can facilitate tracking and reporting
Recap of the FCC Cash Flow framework • Translation • No specific configuration required • Since the activity is being input, Movements and Cash Flow line items are at the Average Rate • Eliminations • No specific configuration required • Since the data is loaded to a combination of the Account and Movement, the eliminations for the Cash Flow organically follow from the Balance Sheet
Recap of the FCC Cash Flow framework • Out of the box calculations • Opening balance • Closing balance (aggregation) • FX impact • Open balance impact • Activity impact • This is netted across Accounts for FX impact on Cash line • Opening Cash • Closing Cash
Dimension Configuration
Dimension Configuration • Several alternatives for creating activity portion of Movement hierarchy • Level of detail options: • Use more common members • Minimizes # of members • Can get tedious when trying to determine if a C/F line needs additional member or not • Use more distinct members • More flexible in arrangement • Adds bulk to dimension • At a minimum need to match C/F statement line detail, sometimes more for audit trail purposes
Dimension Configuration • Movements grouping options: • By Functional type/Account • This helps organize rollforwards better together • Can help dynamically generate report and form line items • By Cash Flow section • These are the out of the box parent members • Not quite as useful as the groupings already exist in the Cash Flow hierarchy
Dimension Configuration • Custom dimension • To track adjustments across members • Should net to zero • For multi-dimensional items • For example, transfers in/out • Can simplify Movement detail • Need to balance functionality with user experience • Account dimension • Alternate groupings possible but not ideal
Data Loading and Mapping
Data Load and Mapping – G/L • Several options for loading activity data as part of TB dataset • Derive mapping from Accounts • Most common approach • Works if there is no supporting detail available • Map change in balance for period to a Movement member • Typically many-to-one mapping (e.g. multiple A/R Accounts to one single change in A/R Movement member)
Data Load and Mapping – G/L • Map using other G/L chart field • Typically limited to specific regions of the Balance Sheet (e.g. Taxes) • If not already in use, may take some time to build up a full fiscal year’s worth of accurate data • Data needs to be consistently populated via subsystem or JEs in order to source it • Will ultimately be a multidimensional map as some lines are only based on Account
Data Load and Mapping – Calculate Movements • Similar to loading from G/L • Load life to date balances instead of period activity to FCCS_ClosingBalance_Input • Configuration: • Flag Movement members as mappable • Configure Movement mapping in Account dimension instead of Data Integration • Enable business rule • Be aware of potential performance implications
Data Load and Mapping – Other Sources • Leverage Subledger data • Load secondary dataset to layer in addition to original load • Example: • Fixed Assets – acquisitions, disposals, depreciation, writedowns • Will likely need additional mapping • Best practice is to use another unique Data Source member to keep values clean and from being overwritten • Offset values need to be created in order to not double count • Use additional sources • Use 3rd party data • Examples: • Investments – purchases, sales, gains/losses • Other industry-specific sources
Data Input
Data Input Approaches • For manual adjustments not in G/L detail there are several options • Data Forms • Allows for POV to be much more specific and layout more structured • Best practice is to limit just to input intersections and use a report to render the full rollforward • Smart View • Flexible, but may end up giving users the ability to input into intersections that are not valid Kscope Kode Challenge Code: CASHFLOWALITHYA21
Data Input Approaches • Journal Entries • Provides audit trail, but more cumbersome to work with • Can use a template for standard POV • Supplemental Data • Allows for much more detail • Subtotals can be automatically pushed into the correct intersections • Requires more overhead and processing steps • Balancing needs to be considered as adjustments need to net out ultimately
Configurable Calculations
Configurable Calculations • Income Statement calcs • Pull values directly from P&L to populate rollforward items, e.g. Amortization • This is frequently more accurate than the change in balance from the Balance Sheet Account • Insertion Point Rules • Will run all the time, even if there is no change to the item • On Demand Rules • Will only run when triggered (e.g. as part of a form)
Configurable Calculations • Balancing calculation • Offset entered values against net change values loaded • This way the net Balance Sheet impact is zero • This can be a general rule if you have one Movement member populated per Account • If there are multiple Movement members per Account you will likely need to hard code the intersections • Better as On Demand Rule • Additional calculations • M&A related reclass adjustments are also possible, depending on complexity
Reporting
Reporting – Financial Statement • Consolidated, comparative report • This is the standard presentation used for internal and external reporting • Zoom option can be added to allow for additional detail
Reporting – Matrix presentation • Put Account dimension on one Axis, Movement on the other • This will give you a rollforward for the full Balance Sheet and indicate where on the Cash Flow the amounts are mapped to • Captures the sum total of all inputs (loaded, calculated, or adjusted) • Can be done as either structured or ad-hoc type report
Reporting – Adjustments view • Adjustments can be tracked across multiple Cash Flow lines • Net adjustment is zero in total • This uses a Custom dimension for the column classifications
Takeaways
Takeaways • Ideal approach on level of detail on Movements is to look at C/F lines and rollforwards in tandem – more detail is always easier to work with • Consider a Custom dimension for adjustments if necessary, for a clean audit trail • Simplify your input forms and use reports to display the full R/F • Make sure all manual inputs or adjustments net to zero, whether by Data Source or Custom • Leverage cross-dimensional aspect when creating reports
> Vendor Presentation: Leading Practices in Multi-Pillar Oracle Cloud Implementations > How Do I Love Cash Flow? Let Me Count the Ways…(11427) > What Did I Miss? Addressing Non-Traditional Reconciliations in AR and Data Integration Design (11513) > Workforce Plus: Tips and Tricks to Give Workforce an Extra Kick! (11415) > Why and How to Implement Operation Transfer Pricing (OTP) with Oracle EPM Cloud (111111) > Integrated Business Processes: A Better Way to Align FP&A Forecast and Management Reporting (11385) > Viasat Launches to the Cloud with Oracle Enterprise Data Management (11486) > ❤️ Matchmaker, Make Me a Match: Can AR Intercompany Matchmaking Tools Be a Perfect Match for You? (11174) > How WillScot-Mobile Mini Utilized Enterprise Data Management for Business Transformation (11489) > See Why This Government Contractor Loves PCM: Live Session with General Dynamics (11395) > How to Allocate Your Close Time More Effectively (11533) > How to Deploy & Integrate Oracle EPM Cloud Profitability and Cost Management (PCM) as an Allocations Sub-Ledger (11109) Don't Miss Our 12 Sessions at Kscope21! Alithya is a platinum sponsor of Kscope21 > Mike Killeen & Zubin Shah, Alithya 6/22/21 | 1:40 - 2:20 PM > Geordan Drummond, Alithya 6/22/21 | 12:40 - 1:40 PM > Seema Shah; Nick Boronski, Oracle, & Lee Divers, State Street 6/23/21 | 12:40 - 1:40 PM > Ryan Ward & Sara Beth Good, Alithya 6/23/21 | 2:20 - 3:20 PM > Andrew Laferla, Alithya & William Harned, MUFG Union Bank 6/24/21 | 11 AM - 12 PM > Alecs Mlynarzek & Vatsal Gaonkar, Alithya 6/24/21 | 2:20 - 3:20 PM > Kevin Black, Alithya & Robert Kursten, Viasat 6/25/21 | 12:40 - 1:40 PM > Geordan Drummond; Nick Boronski & Tim Gaumont, Oracle 6/28/21 | 4 - 5 PM > Kevin Black; Matthew Jacobsen, WillScot Mobile Mini 6/29/21 | 4 - 5 PM > Alecs Mlynarzek, Alithya & Caroline Dill, General Dynamics IT 6/30/21 | 11 AM – 12 PM > Alecs Mlynarzek & Geordan Drummond, Alithya 6/30/21 | 12:40 - 1:40 PM > Andrew Laferla, Alithya 6/30/21 | 2:20 - 3:20 PM
Join the Conversation: Alithya Kscope21 Mingle Sessions Digital Transformation/Cloud Migration • Hosted by: Mike Killeen | 6/22/21 | 12 - 12:40 PM ET Agile Planning: Create Nimble and Dynamic Forecasting in Your Organization • Hosted by: David Pabst | 6/23/21 | 12 - 12:40 PM ET Complete the Kscope Kode Alithya Challenges for a chance to win a great prize! Visit our virtual booth to: - Chat with us live - Schedule time to meet with an Alithya expert - Check out what we have for you in our virtual conference bag
Visit our virtual booth daily from 1:40 – 2:20 PM Complete the daily game challenges for Kscope Kode to win!
How Do I Love Cash Flow? Let Me Count the Ways…

More Related Content

How Do I Love Cash Flow? Let Me Count the Ways…

  • 2. How do I love Cash Flow? Let me count the ways… Geordan Drummond
  • 3. Agenda • Introductions • Framework Recap • Dimension configuration • Data loading and mapping • Data input • Calculations • Reporting • Q&A
  • 4. Introductions • Customer – Lincoln Financial Group • Enterprise Administrator • HFM Administrator • Vendor – Hyperion / Oracle • HFM Consultant • Partner – Alithya • Consultant (Consolidation, Account Recs, Tax, Reporting) • Close and Consolidation Product Manager • Financial Close and Consolidation certified • Narrative Reporting certified • Oracle ACE
  • 5. Recap of the Cash Flow Framework
  • 6. Recap of the FCC Cash Flow framework • This presentation covers the Indirect Method, although Direct Method is also possible • Main concepts: • Instead of picking and choosing selected items, the entire Balance Sheet is considered for the statement • The classification of activity in the Balance Sheet is intrinsic to the generation of the statement • Adjustments can be made for additional detail • The change in Cash for the period is the inverse of the net Balance Sheet activity excluding Cash • All activity is recorded at the lowest level of the organizational structure, which facilitates other impacts like translation and eliminations
  • 7. Recap of the FCC Cash Flow framework • Movement dimension • Two main hierarchies are mirror images of each other • Level 0 members are shared • Movements hierarchy • Rollforward structure • Activity • Cash Flow hierarchy • Follows the statement presentation and groupings • Takes signage into account (Add/Sub on members) • Cash Change • FX • Cash Open/Close • Closing Balance Variance (not for C/F but used for validation)
  • 8. Recap of the FCC Cash Flow framework • Account dimension – Balance Sheet • Primary hierarchy – Reporting • Secondary hierarchy – Cash and Non-Cash • Supplemental members outside of these hierarchies may be useful for disclosure based rollforwards • Custom dimensions (optional) • Not required but sometimes helpful • Can facilitate tracking and reporting
  • 9. Recap of the FCC Cash Flow framework • Translation • No specific configuration required • Since the activity is being input, Movements and Cash Flow line items are at the Average Rate • Eliminations • No specific configuration required • Since the data is loaded to a combination of the Account and Movement, the eliminations for the Cash Flow organically follow from the Balance Sheet
  • 10. Recap of the FCC Cash Flow framework • Out of the box calculations • Opening balance • Closing balance (aggregation) • FX impact • Open balance impact • Activity impact • This is netted across Accounts for FX impact on Cash line • Opening Cash • Closing Cash
  • 12. Dimension Configuration • Several alternatives for creating activity portion of Movement hierarchy • Level of detail options: • Use more common members • Minimizes # of members • Can get tedious when trying to determine if a C/F line needs additional member or not • Use more distinct members • More flexible in arrangement • Adds bulk to dimension • At a minimum need to match C/F statement line detail, sometimes more for audit trail purposes
  • 13. Dimension Configuration • Movements grouping options: • By Functional type/Account • This helps organize rollforwards better together • Can help dynamically generate report and form line items • By Cash Flow section • These are the out of the box parent members • Not quite as useful as the groupings already exist in the Cash Flow hierarchy
  • 14. Dimension Configuration • Custom dimension • To track adjustments across members • Should net to zero • For multi-dimensional items • For example, transfers in/out • Can simplify Movement detail • Need to balance functionality with user experience • Account dimension • Alternate groupings possible but not ideal
  • 15. Data Loading and Mapping
  • 16. Data Load and Mapping – G/L • Several options for loading activity data as part of TB dataset • Derive mapping from Accounts • Most common approach • Works if there is no supporting detail available • Map change in balance for period to a Movement member • Typically many-to-one mapping (e.g. multiple A/R Accounts to one single change in A/R Movement member)
  • 17. Data Load and Mapping – G/L • Map using other G/L chart field • Typically limited to specific regions of the Balance Sheet (e.g. Taxes) • If not already in use, may take some time to build up a full fiscal year’s worth of accurate data • Data needs to be consistently populated via subsystem or JEs in order to source it • Will ultimately be a multidimensional map as some lines are only based on Account
  • 18. Data Load and Mapping – Calculate Movements • Similar to loading from G/L • Load life to date balances instead of period activity to FCCS_ClosingBalance_Input • Configuration: • Flag Movement members as mappable • Configure Movement mapping in Account dimension instead of Data Integration • Enable business rule • Be aware of potential performance implications
  • 19. Data Load and Mapping – Other Sources • Leverage Subledger data • Load secondary dataset to layer in addition to original load • Example: • Fixed Assets – acquisitions, disposals, depreciation, writedowns • Will likely need additional mapping • Best practice is to use another unique Data Source member to keep values clean and from being overwritten • Offset values need to be created in order to not double count • Use additional sources • Use 3rd party data • Examples: • Investments – purchases, sales, gains/losses • Other industry-specific sources
  • 21. Data Input Approaches • For manual adjustments not in G/L detail there are several options • Data Forms • Allows for POV to be much more specific and layout more structured • Best practice is to limit just to input intersections and use a report to render the full rollforward • Smart View • Flexible, but may end up giving users the ability to input into intersections that are not valid Kscope Kode Challenge Code: CASHFLOWALITHYA21
  • 22. Data Input Approaches • Journal Entries • Provides audit trail, but more cumbersome to work with • Can use a template for standard POV • Supplemental Data • Allows for much more detail • Subtotals can be automatically pushed into the correct intersections • Requires more overhead and processing steps • Balancing needs to be considered as adjustments need to net out ultimately
  • 24. Configurable Calculations • Income Statement calcs • Pull values directly from P&L to populate rollforward items, e.g. Amortization • This is frequently more accurate than the change in balance from the Balance Sheet Account • Insertion Point Rules • Will run all the time, even if there is no change to the item • On Demand Rules • Will only run when triggered (e.g. as part of a form)
  • 25. Configurable Calculations • Balancing calculation • Offset entered values against net change values loaded • This way the net Balance Sheet impact is zero • This can be a general rule if you have one Movement member populated per Account • If there are multiple Movement members per Account you will likely need to hard code the intersections • Better as On Demand Rule • Additional calculations • M&A related reclass adjustments are also possible, depending on complexity
  • 27. Reporting – Financial Statement • Consolidated, comparative report • This is the standard presentation used for internal and external reporting • Zoom option can be added to allow for additional detail
  • 28. Reporting – Matrix presentation • Put Account dimension on one Axis, Movement on the other • This will give you a rollforward for the full Balance Sheet and indicate where on the Cash Flow the amounts are mapped to • Captures the sum total of all inputs (loaded, calculated, or adjusted) • Can be done as either structured or ad-hoc type report
  • 29. Reporting – Adjustments view • Adjustments can be tracked across multiple Cash Flow lines • Net adjustment is zero in total • This uses a Custom dimension for the column classifications
  • 31. Takeaways • Ideal approach on level of detail on Movements is to look at C/F lines and rollforwards in tandem – more detail is always easier to work with • Consider a Custom dimension for adjustments if necessary, for a clean audit trail • Simplify your input forms and use reports to display the full R/F • Make sure all manual inputs or adjustments net to zero, whether by Data Source or Custom • Leverage cross-dimensional aspect when creating reports
  • 32. > Vendor Presentation: Leading Practices in Multi-Pillar Oracle Cloud Implementations > How Do I Love Cash Flow? Let Me Count the Ways…(11427) > What Did I Miss? Addressing Non-Traditional Reconciliations in AR and Data Integration Design (11513) > Workforce Plus: Tips and Tricks to Give Workforce an Extra Kick! (11415) > Why and How to Implement Operation Transfer Pricing (OTP) with Oracle EPM Cloud (111111) > Integrated Business Processes: A Better Way to Align FP&A Forecast and Management Reporting (11385) > Viasat Launches to the Cloud with Oracle Enterprise Data Management (11486) > ❤️ Matchmaker, Make Me a Match: Can AR Intercompany Matchmaking Tools Be a Perfect Match for You? (11174) > How WillScot-Mobile Mini Utilized Enterprise Data Management for Business Transformation (11489) > See Why This Government Contractor Loves PCM: Live Session with General Dynamics (11395) > How to Allocate Your Close Time More Effectively (11533) > How to Deploy & Integrate Oracle EPM Cloud Profitability and Cost Management (PCM) as an Allocations Sub-Ledger (11109) Don't Miss Our 12 Sessions at Kscope21! Alithya is a platinum sponsor of Kscope21 > Mike Killeen & Zubin Shah, Alithya 6/22/21 | 1:40 - 2:20 PM > Geordan Drummond, Alithya 6/22/21 | 12:40 - 1:40 PM > Seema Shah; Nick Boronski, Oracle, & Lee Divers, State Street 6/23/21 | 12:40 - 1:40 PM > Ryan Ward & Sara Beth Good, Alithya 6/23/21 | 2:20 - 3:20 PM > Andrew Laferla, Alithya & William Harned, MUFG Union Bank 6/24/21 | 11 AM - 12 PM > Alecs Mlynarzek & Vatsal Gaonkar, Alithya 6/24/21 | 2:20 - 3:20 PM > Kevin Black, Alithya & Robert Kursten, Viasat 6/25/21 | 12:40 - 1:40 PM > Geordan Drummond; Nick Boronski & Tim Gaumont, Oracle 6/28/21 | 4 - 5 PM > Kevin Black; Matthew Jacobsen, WillScot Mobile Mini 6/29/21 | 4 - 5 PM > Alecs Mlynarzek, Alithya & Caroline Dill, General Dynamics IT 6/30/21 | 11 AM – 12 PM > Alecs Mlynarzek & Geordan Drummond, Alithya 6/30/21 | 12:40 - 1:40 PM > Andrew Laferla, Alithya 6/30/21 | 2:20 - 3:20 PM
  • 33. Join the Conversation: Alithya Kscope21 Mingle Sessions Digital Transformation/Cloud Migration • Hosted by: Mike Killeen | 6/22/21 | 12 - 12:40 PM ET Agile Planning: Create Nimble and Dynamic Forecasting in Your Organization • Hosted by: David Pabst | 6/23/21 | 12 - 12:40 PM ET Complete the Kscope Kode Alithya Challenges for a chance to win a great prize! Visit our virtual booth to: - Chat with us live - Schedule time to meet with an Alithya expert - Check out what we have for you in our virtual conference bag
  • 34. Visit our virtual booth daily from 1:40 – 2:20 PM Complete the daily game challenges for Kscope Kode to win!