Oracle General Ledger Financial Policies and Procedures ME CCG Policy Reference: MECCG060. To be approved and disseminated to all staff

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1 Oracle General Ledger Financial Policies and Procedures ME CCG Policy Reference: MECCG060 Target Audience Brief Description (max 50 words) All CCG Finance Staff This document should be read in conjunction with the SBS Accounts Payable Solution Document. Its purpose is to supplement the SBS Cash Receipting and Cash Management Solution Document with local procedures. Action Required To be approved and disseminated to all staff Document Information Version Number Version 1.2 Accountable Officer Responsible Officer Chief Finance Officer Head of Accounting Date Adopted by the Board 13 August 2015 Approved By Audit Committee, 13 July 2015 Review Date June 2017 Stakeholders engaged in development/review Equality Impact Assessment Head of Accounting EQUALITY IMPACT ASSESSMENT This document has been assessed for equality impact on the protected groups, as set out in the Equality Act This Policy is applicable to the Board, every member of staff within the CCG irrespective of their age, disability, sex, gender reassignment, pregnancy, maternity, race (which includes colour, nationality and ethnic or national origins), sexual orientation, religion or belief, marriage or civil partnership, and those who work on behalf of the CCG

2 Amendment History Version Date Reviewer Title(s) Comments /03/13 ISFE Project Officer /09/13 Business Manager/Corporate Support Essex CSU Content of the policy remains unchanged. Only modification is in relation to the formatting of policy to produce version /06/15 Head of Accounting Removed all references to CSU and changes in responsibilities Status: Approved Next Review Date: June 2017 Page 2 of 18

3 Contents 1. Introduction General Ledger Maintenance Oracle Responsibilities Accounting Codes Distribution and Implementation Monitoring Appendix Appendix 2... Error! Bookmark not defined. 9.. CCG System Contacts... Error! Bookmark not defined. Status: Approved Next Review Date: June 2017 Page 3 of 18

4 1 Introduction Background General Ledger is one of the core Oracle modules provided by Shared Business Services (SBS). It is the central repository for all accounting data and provides a complete financial management system for recording transactions, maintaining account balances and creating financial statements. As well as being able to enter journal information manually, the General Ledger also receives transactions from sub-ledgers e.g. payments from Accounts Payable and credit memos from Accounts Receivable. Interfaces such as Payroll and NHS Supply Chain can also feed into it. Every transaction received is stored as a journal entry and, by drilling down from the General Ledger, source data including invoices can be viewed. Status: Approved Next Review Date: June 2017 Page 4 of 18

5 2 General Ledger Maintenance 2.1 Accessing the General Ledger Module Oracle Financials is available via the Extranet and can be accessed via Microsoft Internet Explorer. An Oracle user name and password is needed to access the application. The user name controls the type and number of Oracle responsibilities accessible for each individual; these are displayed when logged in. New users or their managers should contact the Financial Accounting Team in the first instance to arrange for an access form to be completed requesting access (see Appendix 2 for contact details). The User Name is in the format: Organisation Entity code, first initial, and surname e.g. 06QJSMITH. An Oracle password will be provided but will have to be changed at the start of the first logged in session. The application can be accessed via the following link once a username and password have been acquired: Opened and Closed Periods The calendar in each ledger sets out the timetable for the current year. At the end of each month SBS close down the current period, open a new period and set the following month as a future entry period. Journals cannot be posted into any closed period but can be created in the future entry period. At 4pm on the last day of the month the Oracle sub-ledgers are closed. Journals can be entered into the General Ledger until the 2pm close on the 7th working day of the following month. Due to volume of activity it is recommended that invoices are coded and journals are input by mid-day on the sub-ledger and general ledger close dates. Status: Approved Next Review Date: June 2017 Page 5 of 18

6 2.3 Journal Creation A journal is defined as a transfer between two or more account code combinations and can be used to enter both monetary and non-monetary values (i.e. whole time equivalent (wte) statistics). There are several ways to create a journal for entry on the General Ledger Web ADI This process involves the uploading of a journal from an Excel spreadsheet and is recommended for large journals. See page 23 of the ISFE Guide in Appendix 1 for more details Manual Entry This involves entering a debit or credit journal manually to create adjusting journals and accruals. See page 12 of the ISFE Guide in Appendix 1 for more details Reversing Entry This reverses the amount of an existing journal entry. Examples are reversing an error and entering accruals. See page 17 of the ISFE Guide in Appendix 1 for more details Journal Import This involves importing transactions from sub-ledgers and feeder files and involves the integration of the General Ledger with other applications. Status: Approved Next Review Date: June 2017 Page 6 of 18

7 2.4 Statistical Journals Although the Oracle General Ledger module has the functionality to enter Statistical journals, for example to record the number of nurses working on a specific ward, this should not be used. Currently all payroll information, both monetary and non-monetary comes into Oracle via the Payroll interface. If any changes are made directly into the General Ledger, they will not be reflected back into the Payroll system. This does not affect statistical budget journals as these can be entered directly into the General Ledger at any time. Note: Any payroll movements or corrections should be made using the Master Journal Macro spreadsheet and Payroll Error Correction files provided by the NHS SBS for this purpose rather than directly into Oracle. This spreadsheet (which is entity specific) will need to be requested from SBS via: isfe.gl@nhs.net 2.5 Journal Approval Once the journal has been created and saved it can be approved if it is within your approval limit for journal line authorisation. If not the system automatically (via Workflow technology) notifies the relevant approver that a journal is waiting for them to approve. The journal approval process ensures that an additional level of control is applied before a journal can be posted. Approval limits can be set up so that certain types of journals are only approved by someone with sufficient authority to do so. The Oracle General Ledger module contains an approval hierarchy and defined authorisation limits for each user. This is set up based upon the Scheme of Delegation used by the CCG and is set up and maintained by the Financial Accounting Team. Oracle will automatically route journals to the appropriate user based on this hierarchy. Status: Approved Next Review Date: June 2017 Page 7 of 18

8 The Business Intelligence report A921 can be run to see the approval hierarchy for the organisation. The journal approval process works at line level for manual journals and in month for budget journals, i.e. manual journals are approved on a line by line basis and budget journals are approved on a monthly basis. Users are able to self-approve within their approval limit, but if a line is above their approval limit it is automatically forwarded to their next level approver. The Notifications function within Oracle Financials lists all journals that have been approved or are waiting to be approved. Access to this option is via Other, Notifications. After approval a journal needs to be posted to the General Ledger. The Oracle Autopost process runs every 30 minutes and posts any approved journals it identifies. Oracle Autopost does not run at a set time but rather starts 30 minutes after the last process finishes. Note that there is currently no option to post a journal manually, i.e. journals can only be posted during the 30 minute cycle and not in-between cycles. Status: Approved Next Review Date: June 2017 Page 8 of 18

9 3 Oracle Responsibilities The General Ledger responsibilities available within Oracle are: 3.1 GL_STAFF This responsibility has the following functions: Create and approve journals (depending on agreed approval limits) Find and amend journals Enquire and drilldown on journals Run Oracle standard and FSG reports Create and approve budget journals 3.2 GL_MANAGER This responsibility has the following functions: Same as GL_Staff with the addition of: Create account code combinations Approve next level journals 3.3 WEB_ADI This responsibility is able to: Create spreadsheet and upload journals into Oracle 3.4 PAYMENT_REQUEST This responsibility is able to: Create a payment request Status: Approved Next Review Date: June 2017 Page 9 of 18

10 The following sub-ledger responsibilities are also available: 3.5 PAYABLES_INQUIRY This responsibility is able to: Enquire on Supplier, Invoice, Payment and PO detailed information. 3.6 PAYABLES_HELPDESK This is a cut down version of the Payables Inquiry responsibility and has access to: Only the Invoice Overview and Payments Overview. However, it has access to view preapproved and approved invoices available in Oracle and the Interfaces. Status: Approved Next Review Date: June 2017 Page 10 of 18

11 4 Accounting Codes All NHS SBS organisations use a six segment structure to post transactions to the General Ledger. These codes are described below: 4.1 Entity Codes These are originally three digit organisation codes which are converted to four digit codes, for SBS purposes, by the addition of the letter N at the end of the CCG code. The NHS National Entity Code is unique to each organisation the organisation codes for the CCG is 06QN 4.2 Cost Centre Codes These are six digit codes. There is a shared range of codes, for example Balance Sheet codes (000000), and there are also organisation specific codes (Income and Expenditure Codes (starting from )). Each organization has its own range of I&E cost centres that follow a similar structure. 4.3 Subjective Codes These are eight digit codes. The subjective code range is set nationally and the first digit is significant in identifying the expense type: = Fixed Assets Balance Sheet Codes = Other Assets Balance sheet Codes = Liabilities Balance Sheet Codes = Taxpayers Funds Balance Sheet Codes Status: Approved Next Review Date: June 2017 Page 11 of 18

12 = Income (INCO) = Expenditure 4.4 Analysis 1 Codes These are five digit codes. They are specific to each organisation and are set up to meet their reporting requirements. Note that before they can be used a proposal has to be sent to NHS England, via the relevant Area Team, and approval received. 4.5 Analysis 2 Codes These are six digit codes. They are non-specific to organisations and are used nationally to identify all NHS and some Non NHS providers. Analysis 2 codes must always be used where available. 4.6 Analysis 3 Codes These are six digit codes. They are usually used to identify the various types of payroll statistics (Whole Time Equivalent (WTE)). Examples of Analysis 3 codes are: for GBP Actuals and Budgets (this is the default code), and for WTE (STAT). A full accounting code will be comprised of all six codes in the format: Status: Approved Next Review Date: June 2017 Page 12 of 18

13 (Entity Code).(Cost Centre Code).(Subjective Code).(Analysis 1Code).(Analysis 2 Code).(Analysis 3 Code) For example: 06QN RQ8NFT Accounts Hierarchy and Self-Approval There are various methods of viewing the full accounts hierarchy within the General Ledger, including: Cost Centre Hierarchy Report (Business Intelligence reports A911, A9100 and A9110) Account Manager General Ledger It is important that an organisation sets up the hierarchy to reflect its Scheme of Delegation. Each individual can only have one superior in the system and one financial limit for each of Invoice (for purchase invoices), Order Management (for sales orders), Credit Memo (for credits against sales orders) and General Ledger (for journals). In order for the workflow to operate effectively an individual s superior should have a higher limit than the individual. It is the CCG s policy that workflow documents to be approved are sent to an authoriser with a higher limit for approval, even when the individual requesting the approval has a sufficient limit to self-approve. Self-approval of sales orders, credit memos and journals are discouraged and not allowed, unless when absolutely necessary. In this circumstance, approval should be obtained as soon as possible on a hard copy of the workflow request complete with backing documents. 4.8 Vacation Rules When on leave approvers must put their system vacation rules in place so that approval requests are re-routed to the next level of management. It is essential that approvers review their notification lists regularly. If an approval request is not actioned within 5 calendar days it will drop out of the notification list and Status: Approved Next Review Date: June 2017 Page 13 of 18

14 revert back to the requisitioner. Line managers will need to make approval arrangements to cover for periods of leave and set up vacation rules accordingly. Note that vacation rules will need to be set up separately for each Oracle Responsibility, e.g. Non-PO Approval, iproc, etc. There is no vacation rule functionality for journal approval. 5 Distribution & Implementation 5.1 Distribution Plan This document will be made available to all Finance Staff members A global notice will be sent to all Staff members notifying them of the release of this document and its location. 5.2 Training Plan A training needs analysis will be undertaken with staff members affected by this document Based on the findings of that analysis appropriate training will be provided to staff members as necessary. This document will be reviewed every two years. The next review is due by June 2017 Status: Approved Next Review Date: June 2017 Page 14 of 18

15 6 Monitoring 6.1 Compliance Compliance with the policies and procedures laid down in this document will be monitored by the Finance Team, together with independent reviews by both Internal and External Audit on a periodic basis The Head of Accounting is responsible for the monitoring, revision and updating of this document. 6.2 Equality Impact Assessment This document forms part of NHS England s commitment to create a positive culture of respect for all staff and service users. The intention is to identify, remove or minimise discriminatory practice in relation to the protected characteristics (race, disability, gender, sexual orientation, age, religious or other belief, marriage and civil partnership, gender reassignment and pregnancy and maternity), as well as to promote positive practice and value the diversity of all individuals and communities As part of its development this document and its impact on equality has been analysed and no detriment has been identified. Status: Approved Next Review Date: June 2017 Page 15 of 18

16 Appendix 1 Quick Reference Guides Finance Staff User Guide.pdf Finance staff supplementary user g Document Number: MECCG60 Issue Date: Version Number: 1.2 Status: Draft Next Review Date: June 2017 Page 16 of 18

17 Appendix 2 Useful Contacts SBS Contacts i. All AP queries Clients: Tel. Number: address: sbs.clients@nhs.net ii. All AP queries Suppliers: Tel. Number: address: payables@sbs.nhs.uk iii. Management Reporting Helpdesk: Tel. Number: address: management.reporting@nhs.net iv. Financial Reporting Helpdesk: Tel. Number: address: sbs-w.financialmail@nhs.net v. VAT: Claims/ Month end process: Tel. Number: options address: sbs-w.vatteam@nhs.net Document Number: MECCG60 Issue Date: Version Number: 1.2 Status: Draft Next Review Date: June 2017 Page 17 of 18

18 CCG Systems Contacts: Rob Chivas (Head of Accounting) Tel.: Gill Speed (Senior Finance Manager, Financial Accounting) Tel.: Document Number: MECCG60 Issue Date: Version Number: 1.2 Status: Draft Next Review Date: June 2017 Page 18 of 18