NTHABISENG MOKETE City of Tshwane / Executive Director Budget office. BONGILE SITHOLE SAP solution specialist
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1 NTHABISENG MOKETE City of Tshwane / Executive Director Budget office BONGILE SITHOLE SAP solution specialist Journey towards mscoa regulation compliance (challenges and opportunities)
2 Content Legislation Impact on CoT Journey toward compliance Challenges Opportunities and benefits Way forward
3 mscoa as a legislation mscoa stands for municipal standard chart of accounts. The Minister of Finance published SCOA Regulations for Local Government on 22 April All municipalities are expected to comply effective from 1 July In March 2016 National Treasury published circular 80 which prescribed System / Applications minimum functionality. Objectives The objective of the mscoa regulations is to provide a uniform recording and classification of municipal budget and financial information at a transaction level. Seamless alignment in reporting, benchmarking and performance management at local government.
4 mscoa as a legislation The mscoa prescribes seven segments to which a municipality s chart of accounts have to conform and financial transactions recorded. The segments are as follows: The City currently transact on two segment i.e item and function
5 mscoa as a legislation Compliance to mscoa by 1 July 2017 requires: 1. Systems-Integrated Development Plan (IDP); 2. Systems-Integrated budget module; 3. Systems that enable transacting across the seven segments of mscoa 4. With subsystems seamlessly integrating to the core system.
6 Impact on COT People Existing staff capacity Change management and training Process 15 business process affected Technology Configuration of the core system All modules of the City s financial system are affected Sub-system integration Data Migration of data Data clean-up and verification
7 The journey Appointed a mscoa Implementation Partner Establishment of project team consisting of the various stream leaders / business process owners Project Plan Feasibility Study / Due diligence - can SAP be configured to accommodate the mscoa Non-core systems developments identified Unpacking the requirements Circular 80 System specification Unpacking the chart Aligning the current to the new Awareness Workshops Training Consultation System configuration ECC BPC Sub-systems SAP Landscape optimization Chart conversion Migrating the history Testing non sap interfaces Integration UAT Training Plan Go-live activities
8 Challenges Understanding/interpreting mscoa and SAP partners Ongoing developments and changes Unpacking of the business processes / systems specifications outlined in mscoa Circular 80 Challenges with systems in general/how is SAP (as a product) handling the requirements Creation of short codes Integration of non - sap sub-system Migration of data preserving the history SAP capabilities Governance framework Cost of implementation Realistic project timeline Change management
9 Opportunities & benefits For the City Linking strategy to budget Integrated system, moving away from manual intervention and sub-systems Unpacking of business process for best practice mscoa will reduce the cost of compliance in the long-term Improved planning ensures better funding allocation. Improved budgeting, financial reporting and result in better decision making For the Citizens Regional Segment will assist councillors and mayors to account to the communities for resources allocated. Visibility of where municipal funds are mostly spent National Treasury To ensure uniformity in financial reporting Less time spent in reconciling and analysing reports and financial performance Streamlined reporting processes Financial transparency Simplified benchmarking and transfer of skills between municipalities
10 What more can municipalities look forward to? How do you enforce compliance? - Governance Risk and Compliance Keeping staff training/certification onboarding new staff and retraining the old Ensuring a confident closing, a closer look at the SAP Closing Cockpit Financial information at your finger tips and even at voice command Boardroom of the future and voice commands
11 Manual Closing processes Process Act # Description workday Jan Settlements 20.5 Settlement Contracts and SD orders to COPA X Feb Overnight 11:00 CoE VA88 17,1 ;17,2; 17,3 ; 19,2; 24;4 Start Time CET End Time CET KG CoE Transactions Pre-req. Manual Interface Narrative CoE to send - Spool file to KG with SAP Office message with detail of job run. - Excel file with list of errors and proposed corrections to be made (if any). 8. Controls 22.0 Closing monthly accruals headquarter X Feb Before 14:00 5. BW2000 WIP 23.0 KG Posting Cut-off for NI MOD (WBS) X Feb 15:00 KG CO 19.1 KG: SAP office message to be sent back to CoE to confirm Preliminary (1b) Job Cost posting cutoff for NI MOD (WBS) Month end settlement to CO /PA. Overnight job (possible) KG FI F-02, FB60 Manual posting (headquarters, branches ) 5. BW2000 WIP 24.3 WIP/LJP valuation (final run). X Feb 15:00 16:00 CoE YAF63 23 CoE to send : - Spool file to KG withsap Office message with detail of job run and YAF81 report. - Excel file with YAF82 preformatted downloaded list. 5. BW2000 WIP 24.4 WIP, LJP, and Pre post analysis, check, and validation (incl settlement) 8. Controls 25.0 Global order analysis for material consumption X Feb Before 14:00 6. Settlements 26.1 Pre - Settlement notification for: CO orders to COPA WBS to COPA X Feb 16:00 11:00 +1 KG CO XCEL File from YAF82, YAF70D, YAF81, YAF87 KG FI - CO X Feb 11:30 CoE 17,1 ;17,2; 17,3 ; 19,2; 24; KG to confirm that all postings are complete for the preliminary WIP run Run WIP in CoE, and resolve error log. After errors are corrected, run WIP, with posting and settlement to Co- PA. Download YAF82 and YAF70D overnight into XCEL files preformatted for KG analysis. YAF40 Postings finished Check global orders amounts (not increasing, not negative amounts) Coe to send a mail to KG FI/CO resp. with information that Coe to send a mail to KG FI/CO resp. with information settlements will be executed next day at 18:15 that settlements will be executed next day at 18:15 KG mail to confirm that no more FI/CO bookings on orders will KG mail to confirm that no more FI/CO bookings on be done from that time. orders will be done from that time. 6. Settlements 26.2 Settlement CO orders to COPA X Feb Overnight 11:00 CoE KO8G 17,1 ;17,2; 17,3 ; 19,2; 24;4 CoE to send - Spool file to KG with SAP Office message with detail of job run. - Excel file with list of errors and proposed corrections to be made (if any). Month end settlement to CO/PA. 6. Settlements 26.3 Notify KG that COPA MR to C1 level is complete FOR REP and SER 6. Settlements 27.0 Settlement WBS to COPA (completed by step 24.3) X Feb CoE YAF02 26,2; 27; 28 CoE to send: - CO-PA to C1 level by SAP office X Feb 15:00 16:00 CoE CJ8G 17,1 ;17,2; 17,3 ; 19,2; 24;4 CoE to send - Spool file to KG with SAP Office message with detail of job run. - Excel file with list of errors and proposed corrections to be made (if any). After all Job Cost objects have settled, and after OR quality check Month end settlement to CO /PA. Overnight job (possible) 6. Settlements 29.0 Notify KG that COPA MR to C1 level is complete. X Feb 15:30 16:00 CoE YAF02 26,2; 27; 28 CoE to send: - CO-PA to C1 level by SAP office 6. Settlements 29.1 Repair analysis (YAF82 download) X Feb 15:30 17:00 CoE XCEL File from 26,2; 27; 28 CoE to send: YAF82 - Excel file with YAF82 preformatted downloaded list. 6. Settlements 29.2 Preliminary MR Result (MR to C1 incl rec X Feb 16:00 KG CO YAF_MAIN Postings finished YAF_COPA_005 - YAF_COPA_005 MR Report: GAP, Cost Center Reports for STRUCO) Budget / Actual After all Job Cost objects have settled, and after OR quality check After all EI Job Cost objects have settled, and after OR quality check CO Top - down check before CC assessment
12 SAP Financial Closing cockpit Plan Analyze Entity Close Management Execute Monitor
13 Muster Muster Muster Muster 13
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15 Digital boardroom 15
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18 THANK YOU
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