Mosaic Information Session

1. Mosaic Information Session A look at the finance and research finance systems launching in December 2013

2. Introduction

3. Agenda • General Ledger, Chart of Accounts Commitment Control and Value-Added Tax • Purchasing, Accounts Payable, andReimbursements to Employees • BREAK • Customer Billing and Accounts Receivable • Project Costing • Grants (Research Post-Award)

4. Goals today • Provide clarity about what is changing and answer your questions • Provide you the information you need to speak confidently about Mosaic with your colleagues • Encourage you to begin conversations with your teams

5. Overall Project Timeline

6. Draft - For Discussion Purposes Only December Launch Timeline

7. GL/COA/KK/VAT General LedgerChart of AccountsCommitment ControlValue Added Tax

8. GL module of PeopleSoftreplaces FAS and Oracle journal entry

9. GL-010: Create and Process Journals • Journals will be processed via the following methods: • Online (manual) Journals • Journals entered directly into the system • Volume should decrease! • PeopleSoft Excel Journal Entry upload • Replaces current ‘uploads’ now but checks data validity upfront vs. having to go through data control • Journal Generator • automatic journals from submodules or other suites or interfaces • Raw data sent to Journal generator and processed in GL • Import Journals • External system interface journals • Already a completed journal by the time it gets to GL

10. On line Journal

11. Journal Entry Approvals - Workflow • Journal approvals similar to today’s system • Depending on the data in the journal entry, will go through a different approval workflow path • Project related Journals • Project Mgr. Capital, then Capital Accountant • Project Mgr. Trust, then Trust Accountant • Project Mgr. Research, then Research Office approval • Journal Approvals (Dept., Program) • If Program manager is different from Department manager, Program Manager approves • Other Special Journals • PDA Journals – approval to Department Manager • Balance Sheet accounts will go to central finance approval • Transfer accounts will go to central finance approval • Student account journals go to Student AR approval

12. GL-030: Review Financial Information • Different methods to review financial information in PeopleSoft • Delivered reports (like delivered e-reports now) • Online within GL • Online income statement within KK (like screen 32/44) • Drill down capability within each of the above! • Queries

13. GL Online Inquiry

14. KK – summarized income statement

15. GL: Changes to Current Processes • Use of adjustment periods for month end/year end closing • Automated management of PDA via use of Open items • Petty Cash process – new process – more in AP – use of Open Items

16. COA Design • McMaster COA group of Experts and GL team have defined: • characteristics of each Chartfield, • its structure, • detailed definitions, • values • Worked with envelope managers from across the university to convert old COA department account numbers to new PeopleSoft Departments and Programs

17. Old to New Mapping Reminder Research/Capital/Trust: 5/7/8-xxxxx

18. OLD vs NEW COA Terminology

19. NEW ChartfieldString Operating/ Ancillary/Specifically Funded Fund (2) Account(6) Department(5) Program (5) = 18 e.g. 20 600001 10003 30006 Capital/ Trust/Research Fund (2) Account (6) Department(5) Project (8) Project Activity (15) = 36 e.g. 85 600001 10858 10889805 Supplies

20. COA Chartfields • Business Units – 5 GL BU’s • e.g. McMaster (MAC01), Divinity(DIV01) • Funds - 14 • e.g. Operating, Research, Ancillary • Account • currently over 2000 subcodes • reduced to less than 1000 • more standardized structure • required field and available for all to use Account Examples: 110000 – Accounts Receivable 600001 – Materials & Supplies Expense 450000 – Sales Revenue

21. COA Chartfields cont. • Department • Uniquely identified responsibility unit of the University • Approx. 500 • reduced number due to introduction of the Program chartfield and more standardized use of accounts • One ‘definition’ – no more multiple department codes throughout the university! • Program • New dimension available for recording activities within departments • Approx. 20 Generic Programs and 500-600 for Unique Programs • E.g. Conference, Grad Support, Solar Car • Project (Capital, Research, Trust) • Converted projects will maintain old number with ‘10’ in front of it • Project Activity • Defines the processes or actions necessary to complete the Project • Other project chartfields include: PC BU, Source Type, Analysis Type

22. Translation Table for COA Pulp&Paper Research

23. KK (Commitment Control) • Limited knowledge of the actual module itself necessary for most users • Commitment transactions are generated out of other systems (eg. AP, HR) and most users will just see two commitment amounts on their online or static reports (pre-encumbrance/encumbrance) • Capital budgeting process will be done through Commitment Control – all other budgeting done in Hyperion • Hyperion will update the Commitment Ledger in GL

24. VAT (HST) • Main decision: use generic GST/HST and Provincial values • Many manual calculations and j/e’s done currently for HST – will be automated in PeopleSoft • System will track taxes by Province • Internal vs external sales percentages used to calculate ITC and rebates upfront • Less manual journal entries should be necessary

25. Purchasing, Accounts Payable, andReimbursements to Employees

26. Purchasing • Requisition Entry in PeopleSoft • by Requester • System validates information; e.g. chartfield, supplier, etc. • Automated Approval workflow tied to EOI and Strategic Procurement thresholds • Vendor Set-up and Management • To be performed by Strategic Procurement • New Vendor Request form being created

27. Purchasing • Procurement Contracts to be handled by Strategic Procurement • Involve SP at the beginning of the process • Formal Process within PeopleSoft to handle RTV’s (Returns to Vendor) that will be tied back to original PO

28. Purchasing • System will auto source PO from the Requisition and auto dispatch PO to supplier • Threshold to be determined • Three way matching (PO, Receiving, Invoice) performed on all purchases greater than $2,500. Two way matching (Invoice, PO) on purchases less than $2,500

29. Accounts Payable • Voucher Processing – Non PO Invoices (e.g. Cheque Requisitions) • File upload (i.e. flat file) • Excel spreadsheet upload (Bookstore, Hospitality Services, Student Awards and Refunds) • Decentralized voucher entry • Voucher Processing – PO Invoices • Accounts Payable

30. Accounts Payable • Payments Terms • From net 45 to net 30 • Payment Processing • PO invoices • cheque and EFT (Cdn $) = Monday • All other payments • Cheque = Tuesday and Thursday • EFT (Cdn $) = Wednesday and Friday • Drafts/Wires (i.e. foreign currencies) = Monday

31. Accounts Payable • Acquisition Card (Pcard) – BMO MasterCard • Feed from BMO to PeopleSoft • Reconciliation within PeopleSoft • Petty Cash replenishment • Process will not change significantly • Will use “internal bank” as opposed to journal entry

32. Employee Reimbursement • Travel Authorization • To be used for pre approval of exceptions to policy (i.e. business class airfare) • Use not mandatory • Cash Advance • No accountable advances; expenses reimbursed as they are incurred • Encourage cash withdrawals using Diners card • Exceptions: research study subjects, group travel, athletic team travel and where access to ATM not possible

33. Employee Reimbursement • Expense Report • Encourage self service • Use of corporate credit card (Diners MasterCard) • Daily feed from Diners to simplify data entry • Payment by EFT to employees bank account on record in Payroll • AP can pay Diners by EFT on behalf of cardholders • Non Employees and Visitors • Non PO Voucher

34. Employee Reimbursement • Approval workflow to be utilized • Feed of reporting hierarchy from HR • Compliance review at beginning of workflow • Tax (HST) calculations and rebates to be calculated within PeopleSoft • Preparer can override if tax calc. incorrect

35. General • End user will be able to query all transactions • Document imaging to be utilized • Automated workflow and notifications • Ability to view where transaction is in approval workflow • Ability to inquire entire payment cycle • Data validation • Overall – greater transparency

36. Break

37. Customer Billing and Accounts Receivable

38. Finance Solution Overview

39. Detail Design Approach – Billing / AR Unique approach for AR BI due to remote and diverse business needs • Each business area is unique and we met with all of the larger groups. Three general groups emerged: • May have entrenched business systems that can not be replaced by PeopleSoft BI • Inventory Management, POS systems, scheduling or other specialties • E.g. Bookstore, Athletics & Recreation, Media & Print Services (TBD) • Solution becomes improved GL distribution • More granular, more detailed descriptions, approvals • May have business systems that CAN be replaced • Nuclear • No system, or does not produce a bill, and can adopt PeopleSoft BI / AR • Catering • Any University business area that needs to produce a Bill • Smaller volume operations

40. Key Design Decisions • Business units are where transactions are stored,  The following will be setup in AR/BI :  • Research Health Sciences • Research General • Nuclear Reactor • Parking • Finance – General • Health Sciences • Print Services • UTS • Bookstore • Athletics & Recreation • Conference Services & Hospitality • Library • There will be two invoice (bill) layouts: • Research layout • Common McMaster layout

41. Key Design Decisions • The Cashiering function will be replicated using PeopleSoft AR, • financial coding details • receipt generation.  Similar to today, the distributed nature of receiving payments will continue however with greater autonomy, responsibility and accountability in the distributed business areas.  The deposit entries will be completed locally, as well as the preparation of the physical deposit bag for the bank.  Central finance will no longer need to recount or amalgamate the deposits.

42. Customizations Customizations • Invoice layout • Receipt layout • Sponsor award number in AR Payment application • Monerisecommerce file load • Bank Statement load

43. Issues • Student Interim Process • Student related transactions including receiving payments • Will use online cashiering and maintain that process until Student Administration goes live

44. Key Process Changes • Deposits not amalgamated, central finance does not check/close batch • Where manual, bills migrate to PeopleSoft • Payment application to detailed open items as opposed to an AR account

45. Process Improvements • Billing! • Centrally recorded AR, distributed process • Improvements in internal cost transfer details (GL Interface) • Bank reconciliation more automated • Greater visibility of AR details

46. Billing Solution

47. Accounts Receivable (AR) Terminology • PeopleSoft AR is created from a bill and represents an ‘item’ to be paid • Similar to, but not to be equated to an AR Balance • Payment Application – taking an individual payment and paying a specific item(s) • Direct Journal – taking a payment and creating a revenue journal • Cashiering – at the University cashiering is the function of receiving payments and recording the accounting for those payments. PeopleSoft does not have ‘Cashiering’ but does have places to record payments received in either detail or summary, and in a two-step process payments are applied.

48. AR Solution

49. Cashiering • Walk up • Enter deposit • Direct Journal to revenue accounting • Generate receipt • Moneris  Ecommerce • centrally entering Moneris sales data to a revenue clearing account for each merchant • Remote business areas • Enter deposit (summary or detail as necessary) • Apply payment either to open items or direct journal • Create deposit slip • Pickup for banking • Central Finance • Arranges delivery to bank • Reconciles bank statement

50. Conversion • Re-key customers where necessary • No open AR item conversion • Old systems will be closed out without converting open items • No GL Impact • No Bill conversion