Calgary: TCA Reporting Policy Update

Transcription

1 Calgary: TCA Reporting Policy Update October 11,

2 Agenda Tangible Capital Asset (TCA) reporting policy TCA reporting structure TCA reporting system Lessons Learned 2

3 Overview: What We Worked On Step 1: TCA policy updates Machinery & equipment Buildings Engineered structures Land improvements Land Vehicles Step 2: TCA structure changes Step 3: TCA system implementation 3

4 Step 1: Water s TCA Policy / Asset Hierarchy Common Feedback Re: TCA Policy and Asset Hierarchy 50 Profile IDs Asset hierarchy is too detailed. $100K/component Capitalization threshold is too low. Manual disposal Disposals are time consuming. TCA Environment Amount of Costs $300M of capital additions, >100 projects Timing of Costs 40% of invoices received in Nov. & Dec. Tracking of Costs Use of Excel spreadsheets 4

5 Discussion Area What are some common concerns that your jurisdiction has re: TCA policy and/or asset hierarchy? 5

6 Step 1: TCA Policy / Asset Hierarchy 1. Asset hierarchy Focus: how much level of detail needs to be captured? End result: 50 profile IDs to 15 profile IDs 2. Capitalization threshold Focus: how are costs managed by Operations? End result: $100K/component to $250K/project value 3. Disposal method Focus: how can we simplify the calculations? End result: automated calculator that uses present value 6

7 Discussion Area If you could change your area s policy/hierarchy, what would it look like? 7

8 Step 2: Changes to Reporting Structure What Were the Changes? Established centralized TCA reporting team in Finance Responsible for The City s TCA reporting activities Collaborates with Operations and other areas of Finance Goal: Develop TCA reporting experts in Finance All team members apply the TCA reporting policy in the same manner Share resources among Finance Have Finance be accountable for TCA decisions Out of scope: Alignment of asset management with financial reporting Integration of project management activities in the new system Budgeting and management reporting activities Why Were the Changes Needed? Misaligned roles and responsibilities led to: Duplicated work Inconsistent TCA processes and reporting Accounting errors 8

9 Step 2: Changes to Reporting Structure How Were the Changes Developed? Task force performed current state analysis and designed options Required collaboration between Finance and Operations personnel Use of change management and communication strategy Updated Reporting Structure: Feedback Loops TCA Transition Finance Business Unit Finance Finance Finance Develop Policy Provide Asset Info Prepare TCA Info Reconcile Accounting Manage Audit 9

10 Discussion Area Could a centralized model work for your jurisdiction? Why or why not? 10

11 Step 3: Implementing a New System Why Was a New System Needed? BU Cost reconciliations are difficult. It takes a long time to review invoices. There s high staff turnover. TCA Project Governance and reporting changes will not be sustainable if no system changes are made. Auditors The City relies on manual processes and has no dedicated cost tracking tool. 11

12 Step 3: Implementing a New System What Was The City s Solution? Implemented PeopleSoft s Project Costing (PC) module Aligned with existing PeopleSoft products (e.g. Asset Management) Allowed project team to leverage their knowledge/experience with the module Supply (Req., PO) GL (Journals) Asset Mgmt. (Assets) AP (Invoices) PC Module (Project cost) Introduced: Requirement use PC module specific chartfields to identify capital projects Process to request for Project IDs (to track projects) Built to accommodate additional functionalities, such as Hyperion and project management tracking 12

13 Discussion Area What kind of change management strategy was used at your municipality when implementing new systems? 13

14 Summary: Where We Are Today We use a uniform strategy to maximize consistency. One process: All asset categories have now been assessed. One team: Our team is in place working with Finance & Operations. One system: The module was launched in April and is operational. 14

15 Lessons Learned General Engage Operations and Finance Ensure management will champion the changes Use a change management specialist Have open and ongoing communications with stakeholders Keep the external auditor up-to-date System Implementation Be vigilant and avoid scope creep Choose your project team wisely Identify resource requirements as soon as possible Determine if a paradigm shift is needed Establish a dedicated IT team to resolve system issues 15

16 Questions? 16