Process Document # 7 Finance

Transcription

1 Process Document # 7 Finance Version 7.3 Dec 5, 2014 Document Approval Process Owner: Sandra Piperias Finance Controller Signature: Date: Gracy DaSilva Finance Analyst Signature: Date: Jasoda Deonarine Finance Analyst Signature: Date: Note: Your signature indicates that you agree with the contents of this document and that it accurately reflects the current state of business operations within your Division / Department at the Canadian Kennel Club.

2 Document Information Title: Version: 7.3 Status: Purpose of Documentation: Document Soft Copy file path: Canadian Kennel Club Finance Services Draft This document summarizes the current state as is financial operations processes and serves as a baseline for the business process owner and the organization in general to understand; - End-end finance operational workflow and metrics - Finance pain-points - Continuous improvement opportunities This document will be used to formulate the future state solution requirements which will be further documented in an RFP. Andrew McCallister to utilize Basecamp as the document repository location Document History Version: Date: Updated by: Comments: 7.1 Nov 21, 2014 Tom Gibson Working draft for review 7.2 Nov 27, 2014 Tom Gibson Working draft for review 7.3 Dec 5, 2014 Pamela Harding Updated versioning and the mega process map Page 2

3 Table of Contents Document Information... 2 Document History... 2 Table of Contents Process Information Process Overview... 6 High-Level Process Description:... 6 Process Objectives:... 6 Participants (include External participants if applicable):... 6 Inputs / Pre-requisites to this Process (include who is responsible):... 6 Outputs / Post-requisites to this process (include who is responsible):... 7 Out of Scope:... 7 Relevant Policies... 7 Relevant SLAs / Metrics:... 7 Location of Supporting Documentation:... 7 Additional Information: Glossary of Key Terms High-Level CKC Mega Process Map - Finance High-Level Process Map Finance Services Activity-Level Process Map Financial Reporting Activity-Level Process Description Financial Reporting Pain Points and Continuous Improvement Financial Reporting Opportunities Financial Reporting Activity-Level Process Map Payables Activity-Level Process Description Payables Pain Points and Continuous Improvement - Payables Opportunities - Payables Activity-Level Process Map Fixed Assets Activity-Level Process Description Fixed Assets Pain Points and Continuous Improvement Fixed Assets Opportunities Fixed Assets Activity-Level Process Map Credit and Collections (APPX Workflow) Page 3

4 Activity-Level Process Description Credit and Collections (APPX workflow) Pain Points and Continuous Improvement Credit and Collections Opportunities Credit and collections Activity-Level Process Map Payroll Activity-Level Process Description Payroll Pain Points and Continuous Improvement - Payroll Opportunities - Payroll Activity-Level Process Map Receivables Activity-Level Process Description Receivables Pain Points and Continuous Improvement - Receivables Opportunities - Receivables Activity-Level Process Map Budgeting Activity-Level Process Description Budgeting Pain Points and Continuous Improvement - Budgeting Opportunities - Budgeting Page 4

5 1.0 Process Information Business Process Purpose Finance Services has the mandate to; 1. Maintain the official financial records of the CKC 2. Exercise their fiduciary responsibilities to the Board which oversees club operations 3. Ensure that all financial reporting abides with proper financial policies and procedures according to Generally Accepted Accounting Principles (GAAP) 4. Ensure that the club has proper financial controls in place 5. Ensure the integrity of the information used in financial reporting 6. Oversee club operations and fiscal controls and financial efficiency 7. Ensure the integrity of reporting club assets (cash and fixed assets) The Team consists of 1- Finance Comptroller and 2 Finance Analysts Business Unit Business Sub-Processes Process Stakeholders (those in addition to the functional units involved): Finance Services 1. Invoicing receipts and adjustments 2. Budget planning 3. Reporting 4. Accounts payable 5. Fixed assets management 6. Payroll 7. Credit and collections 1. Board 2. Members 3. CKC operating department heads Page 5

6 2.0 Process Overview High-Level Process Description: Process Objectives: Participants (include External participants if applicable): Inputs / Pre-requisites to this Process (include who is responsible): This Team has the mandate to execute on its business purpose and to deliver seamless financial services as follows; 1. Invoicing and accounts receivable 2. Credit management and collections 3. Budget and results reporting (month end close) 4. Financial reporting (fiscal year January December) 5. Payroll 6. Fixed asset management 7. Accounts payable 1. To ensure that Club operations are cost efficient 2. To ensure that timely and efficient financial services are delivered for their internal business clients 3. Ensure the integrity of all financial records and reporting to stakeholders 4. To be as transparent as possible in the delivery of these services 5. To ensure compliance to government regulations Internal Club Executive Director and Department heads Audit committee Board External MJR Collections Taxing authorities HR Benefits Provider (TBD) CIBC Credit card clearing (TBD) Payroll company: ADP BDO auditors Manulife: Pension Inputs to this process include: 1. Operating budgets 2. Member and stakeholder remittances 3. Asset acquisitions 4. Employee payroll data 5. Taxing authority policies and guidelines 6. Audit committee policy and guidelines Page 6

7 Outputs / Post-requisites to this process (include who is responsible): Out of Scope: Relevant Policies Relevant SLAs / Metrics: Location of Supporting Documentation: Additional Information: 7. Club auditor - BDO 8. External accounting standards of practice 9. Execute on Strategic Imperatives as mandated by the CKC executive leadership team, Board and various committees. 1. Payments to taxing and regulatory authorities 2. Payroll data 3. Financial reports and records for stakeholders, Annual Report for Club members via CKC.ca 4. Guidance for financial operations to Departments 5. Recommendations on all financial matters impacting the Club 6. Financial controls 7. Cash management 8. HR 1. Pricing (make recommendations of fees schedule to Board) 2. New business initiatives (input through analysis) 1. Policies and Bylaws which govern CKC operations 2. Accounting guidelines 3. CKC financial and operating policies 4. Auditor and audit committee policies 1. Monthly, quarterly and annual reporting for stakeholders 2. On-time remittances to taxing authorities TBD Business continuity risks: high Finance operations are critical to the core business operations of the CKC and a business continuity plan should be documented. Also of note, due to small Team size, there are operational risks associated with Team resources. Page 7

8 3.0 Glossary of Key Terms GP Term Great Plains Definition Page 8

9 4.0 High-Level CKC Mega Process Map - Finance Page 9

10 4.1 High-Level Process Map Finance Services Page 10

11 5.0 Activity-Level Process Map Financial Reporting Page 11

12 5.1 Activity-Level Process Description Financial Reporting Activity Description Input Output 1a Run APPX sales, cash and adjustments reports and manually enter into GP Sales, cash and adjustments registers from APPX 1b GP generated transactions All GP generated invoicing, AP, inventory, fixed assets, adjustments, 2 Post batches into GP to achieve consolidated view in Great Plains 3 Run period end close process in GP (monthly) Each transaction stream gets posted in GL -Manually generated APPX batches -GP batches Steps 1 and 2 are completed 4 Run Financials in GP Step 3 is completed 5 Perform analytics and prepare financial packages Step 4 completed Manual journal entry to update accounts in GP Automated posting of batches as journal entries to update accounts in GP Batches posted into GP All reconciliations are completed Reports generated GP Financials are produced Analytics completed and monthly reports are produced Systems Used APPX, GP GP GP GP GP Microsoft Dynamics Manual, GP, exel, Microsoft Dynamics Additional Information Finance posts the timing of batches Page 12

13 6 Review and distribute All previous steps are completed Reports are reviewed and approved for distribution Reports are used by Stakeholders 7 External Audit Annual report Audit year end close by BDO (Management Report Writer) Manual Auditor system, GP, Microsoft Note: payables, inventory, fixed assets, non-appx sales (e.g. regulatory, product) are posted automatically into GP, and all other transactions are posted manually. 5.2 Pain Points and Continuous Improvement Financial Reporting 1. IT support for Great Plains and report writer; learning curve issues; ongoing support issues with 3 rd Party Support Rimrock 2. APPX main sales system talks to GP only once a month. Batch mode needs to be more frequent, involves revising interface schedule between APPX and Great Plains. Reports and results could be weeks old before reports are available for analysis. Involves manual entry of data to get integrated view of financials 3. Accounts Receivable very cumbersome to process because of adjustments, credit cards (requiring workflow optimization) 4. Access to Customer data is often cumbersome, e.g. information on membership (to project revenues by type) needs to be requested through IT for special report 5.3 Opportunities Financial Reporting 1. Automate APPX reporting into GP to avoid manual posting of data and swivel chair efforts by Finance Team 2. GL structure is restrictive 3. Pricing, although Board approved, should involve the active input and participation of the Finance Team for benchmarking and analytics. 4. Introduction of sales database to assist with analysis of how many of what service has been sold / forecast of sales. Page 13

14 6.0 Activity-Level Process Map Payables Page 14

15 6.1 Activity-Level Process Description Payables Activity Description Input Output 1 Invoices received Invoice, expense report statements with backup 2 Audit and code payable invoices Completed step 1 with all required backup Receive input documents in mail / Finance Dept. for processing Audited expense statement with appropriate GL coding 3 Enter into GP Completed step 2 Data entry into GP GL, print cheques for payment 4 Comptroller audit and review Completed step 3 Review and approve expense and route to Executive Director for approval 5 Executive Director review Completed step 4 Signature authorization from Exec Director on cheques 6 Cheque creation and mail Completed step 5 Mail cheque, retain backup for expense records Systems Used Manual Manual Great Plains Manual Manual Additional Information Automate payments to vendors and employees Page 15

16 6.2 Pain Points and Continuous Improvement - Payables 6.3 Opportunities - Payables 1. Automate payables through electronic format to avoid cheque handling costs and mail costs and delays Page 16

17 7.0 Activity-Level Process Map Fixed Assets Page 17

18 7.1 Activity-Level Process Description Fixed Assets Activity Description Input Output 1 Pay invoice for capital asset Invoice has been approved for payment 2 Set up Asset account Asset class and depreciation category 3 Depreciation starts Step 2 has been completed Asset invoice available for entry into GP Invoice has been reviewed and qualifies as capital asset Fixed asset account has been setup in GP Depreciation starts Spot check depreciation reports Depreciation expense posted to GL Systems Used Great Plains Great Plains Great Plains Additional Information Capital assets include, computer hardware, software, furniture and fixtures, capital assets Asset account setup by invoice as individual record, not asset category Page 18

19 7.2 Pain Points and Continuous Improvement Fixed Assets 1. Fixed assets currently entered to GP at invoice level rather than as asset class. This is likely a limitation of GP reporting to group categories within the Fixed Assets module 7.3 Opportunities Fixed Assets 1. Ability to perform fixed asset counts 2. Complete list of Club assets not currently available, opportunity to introduce asset tagging and tracking procedures Page 19

20 8.0 Activity-Level Process Map Credit and Collections (APPX Workflow) Process Document Finance Services Page 20

21 8.1 Activity-Level Process Description Credit and Collections (APPX workflow) Activity Description Input Output 1 Transaction processed against member s account in APPX 2 AR statement run with aging APPX runs statements twice monthly on 15 th and 30 th of month 3 AR statement reminders are generated 4 Members account is place on hold in APPX 5 Finance initiates in-house collections process Aging report Aging report Aging report >90 days and $100 6 Finance contacts member Aging report >90 days and $100 7 Member account suspended to D status Non-payment and aging report > 120 days 8 MJR Collections Non-payment and aging report > 120 days Transaction record in APPX Transaction status, paid, not paid, aging if not paid Service charges are calculated Member gets AR notice Members account is suspended in APPX when aging is >60 days Calls member, sends collections letter Establishes bad debt provision Starts collections file with call or letter log to member Refer account to MJR Collections Finance update member account to D status Payment, non payment referred to Finance Systems Used Automated in APPX APPX APPX APPX Manual GP Manual APPX Additional Information Page 21

22 9 Non-payment MJR aging report Write off bad debt for non-payment 10 Payment MJR aging report Reactivate member account APPX APPX 8.2 Pain Points and Continuous Improvement Credit and Collections 1. AR sub-ledger on 2 different systems 2. Trial balance with aging liability very manual 3. Membership renewals, AR must be manually over-written in APPX so that member accounts don t get suspended for > 60 days; note that membership renewals occur en mass in October but not due until Dec 31; this creates a Finance Team resource crunch during renewal period Oct Dec as to review each account 8.3 Opportunities Credit and collections 1. Aging in APPX sub- ledger is driven by statement run date 15th vs. 30th. Manual process of achieving Aged Trial Balance is not accurate other than on 15th and 30th Page 22

23 9.0 Activity-Level Process Map Payroll Page 23

24 9.1 Activity-Level Process Description Payroll Activity Description Input Output 1 HR approves additions, deletions, changes to employee records 2 Process employee changes in ADP system 3 Remit payroll updates semimonthly Employees data Employee data changes Changes to semimonthly payroll data HR and Executive Director approval of employee records Database records for employee available at ADP Data available for ADP to process payroll 4 Process payroll data Completed step 2 ADP processes payroll data and 5 Audit payroll report and release for payment Payroll report provided in step 3 Generates an audit report for CKC Finance department Audit and approval of payroll details by employee Process to GL by department Comptroller signoff on payroll Releases payroll 6 Transfer funds to employees Completed step 4 Funds electronically transferred to employees bank account 7 Transfer funds deducted at source Completed step 4 Funds electronically Systems Used ADP on-line system Online report Additional Information Payroll audit must be released 4 days prior to funds transfer Page 24

25 transferred to taxing authorities i.e. EI, EHT, CPP, federal income taxes 8 Update GL in Great Plains Payroll report GL updated in Great Plains GP Note: annually ADP provides a T4 to employees; Finance ensures that payroll records in GP agree with the T4 record 9.2 Pain Points and Continuous Improvement - Payroll 1. All employee records for vacation and lieu time are presently tracked manually by the Department 9.3 Opportunities - Payroll Page 25

26 10.0 Activity-Level Process Map Receivables Page 26

27 10.1 Activity-Level Process Description Receivables Activity Description Input Output 1 APPX generates revenue transaction 2 GP generates revenue transaction 3 Manual registers used to create batches to update into GP Sales Sales Manual effort in Finance Revenue transaction Revenue transaction Batch 4 Receivable sub ledger in GP Automated 5 Consolidated AR balance created in GP 6 Manual updates in GP for collections Batches Batches posted to GP 7 Collection action >30 days Aging report Manual letter sent includes AR statement 8 Collection action >60 days Aging report Create aging report Refer to MJR for collections Create provision in GP 9 MJR Collections Aging report Collection processes 10 MJR collect overdue revenue Book revenue GP 11 MJR does not collect overdue revenue Write down revenue Systems Used Additional Information APPX Represents approx. 95% of revenue transactions; memberships, registrations, GP Represents approx. 5% of revenue transactions (product sales, regulatory charges) APPX GP Manual, GP GP GP Page 27

28 10.2 Pain Points and Continuous Improvement - Receivables 10.3 Opportunities - Receivables Page 28

29 11.0 Activity-Level Process Map Budgeting Page 29

30 11.1 Activity-Level Process Description Budgeting Activity Description Input Output 1 Strategic Imperatives set for organization 2 Top line targets set by Executive Director Board and Executive Mission / vision SWAT analysis Completed step 1 3 Board approval Go/no go Exec Director presentation step 2 4 Departments provide detailed operations impacts Go decision in step 3 5 Finance consolidation Input from all stakeholder departments 7 Exec Director presents to Audit Committee for approval 8 Exec Director presents to Board for approval Completed step 5 List of strategic and operations imperatives Initiative goals, objectives, revenue, margin targets Systems Used Manual Manual Additional Information Board Approval Presentation Scheduled for Sept Board Mtg Resource effort, costs, revenue, detailed business impacts and risks to support initiative(s) Comprehensive consolidated revenue / cost analysis Inputs to Board presentation Audit Committee approval 9 Board approval Completed step 8 Board approval Semi-manual Some exel use from Finance Exel October timeframe October timeframe In advance of Scheduled December Board Mtg Completed step 4 Board presentation December Board Mtg Page 30

31 6 Finance updates GP Completed step 9 Allocate monthly budget to department(s) Track initiative 11.2 Pain Points and Continuous Improvement - Budgeting 11.3 Opportunities - Budgeting Page 31