Columbia University Medical Center

1. Columbia University Medical Center Training Certification Program For Senior Financial Administrators - Session 9

2. Session 9 - Capstone

3. Agenda • Welcome and Introductions • Acknowledgements • Remarks – Dr. Gerald Fischbach • Stephen Case • John Mattie • Capstone Presentation – Michael McGuire • Question and Answer • Presentation of Certificates • Closing Remarks Session 9 - Capstone

4. Steering Committee Members • David M. Cohen • Lisa Franciosa • Gary Herrmann • Galene Kessin • Kiki Korikis • Michael McGuire • Michael O’Connor, Ed.D. Session 9 - Capstone

5. Training Faculty • Name Department • Michael McGuire PwC • Edie Miller Budget & Finance • Myra Marte-Miraz Dept. of Medicine • Michael O’Connor Dean’s Office • Kathy O'Donnell Clinical Affairs • Sara Patterson Dental & Oral Surgery • Dorothy Pearlman Budget & Finance • Michael Reich Purchasing • Jamie Rubin Research Admin. • Richard Ruttenberg Restricted Funds • Carl Sparano Restricted Funds • Susie Stalcup Development • Michael Van Biema Purchasing • Ofra Weinberger Science Tech Ventures • Name Department • Michael Barone PwC • Geoffrey Berg School of Nursing • Jerry Boak Controller’s Office • Yvonne Boothe Development Systems • Marlene D'Agostino Dept. of Anesthesiology • Lisa David Department of OB / GYN • Steve Elliott University Budget & Finance • Lisa Franciosa PwC • Steve Gillis PwC • Stephanie Goldberg Shared Practice • Amy Goldman PwC • Gary Herrmann CUMC Budget & Finance • Barbara Hurleigh Controller’s Office • Galene Kessin CUMC Human Resources Session 9 - Capstone

6. Capstone: Agenda • Environment • Current Trends • Challenges / Opportunities • Assessment Framework • Meeting the Challenge Session 9 - Capstone

7. Capstone: Role of Financial Administrators: • Financial Administrators are trained and hired for the purpose of providing fiscal, policy, and internal control management of all funds in a department or division • They are responsible for ensuring that processes and related controls have been established to achieve the mission and objectives of the organization. • Internal Controls include procedures for ensuring reliable financial information, establishing accountability and safeguarding of assets, determining that transactions are proper for the account and in compliance with University policies, statutes, and regulations. • Responsible for ensuring administrative effectiveness of the day to day operation of the department Session 9 - Capstone

8. Industry Drivers Shaping Financial Management Business • Institutional Reorganization • Multiple Data Types • Disparate Systems and Processes • Fragmented Controls Mgmt. New Regulations Financial Reporting • GAO Independence Standards • Revised OMB A-21 & CAS • FASB 116 & 117 and GASB 35 • Senate Finance Com initiative Reporting University Reporting Consolidation • New Technologies • Web Based • Standard Tools and Data Models • Best of Breed Suite Solutions • New ERP Functionality Stakeholder Demands Inefficiencies • Transparency • Reliable, accurate and timely • Board of Trustees governance • Sponsor reporting • Spreadsheet reporting • Multiple & Misused COA’s • Data Manipulation vs. Analytics • Multiple Signoffs Session 9 - Capstone

9. Current Trends ImpactingFinance and Accounting Operations • Market and regulatory conditions have placed greater importance on finance and accounting operations: • Greater focus on timely and accurate information and internal controls and compliance • Need to increase quality of skills and re-balance competencies and headcount between transaction processing, control and analysis • Continued implementation of outsourcing and shared services for high volume transaction processing • Deployment of new enterprise wide risk and treasury management tools Session 9 - Capstone

10. Current Trends ImpactingFinance and Accounting Operations • Under delivery of the Enterprise Resource Planning systems (ERP) promise has resulted in increased finance reengineering and system tuning: • ERP systems implemented in prior years do not currently support changing business model • Need for development of common data model and processes to link planning, budgeting and reporting • Better processes and tools to analyze customer, channel and/or product profitability • Increased investment and integration of performance management tools, self service and web deployed processing Session 9 - Capstone

11. Improvement Opportunities The current environment and market conditions present unique improvement opportunities for Finance and Accounting Organizations. • Working Capital Management • Performance Measurement • Cost Management • Compliance Risk Management • Decision Support • Operational Investments Performance Management Planning, Budgeting & Forecasting Strategy Treasury & Finance Back-Office Operations Consolidation & Reporting • Strategic Planning • Mission Initiatives • Donor Relations • Capital Structure • Strategic Value Initiatives • Working Capital Planning • Budget and Planning • Mission Performance Measures • Capital Management • Forecasting • Cash Controls & Management • Investment Management • Corporate Finance • Financial Risk • Insurance • Transaction Processing • Accounting Reconciliation • Outsourcing • Shared Services • Business Integration • Financial Close and Consolidations • Inter-School Eliminations • Financial Analysis • Financial Reporting • Regulatory Reporting Session 9 - Capstone

12. Improvement Opportunities Systems & Tools Structure & Skills Risks & Controls • Performance Management • Budgeting and Forecasting • Finance Operations • Consolidation and Reporting • Organization Structure • Competencies and Skills • Training and Development • Control Environment • Control Activities • Operations Monitoring • Internal & External Testing Session 9 - Capstone

13. Operational Finance Assessment Framework • Your assessment framework links opportunities within the Finance Value Chain with mission and operational strategies Core Applications Customer Expectations Business Requirements Organizational Structure Flows Data Model Staffing Levels Interfaces Operational Strategy And Service Delivery Policies & Controls Ownership Competencies Infrastructure Development Best Practices Performance & Cost Measurement Supporting Systems & Tools Session 9 - Capstone

14. External Reporting What is the Financial Management Cycle ? Strategy Evaluation Simulation Value Calculation Who needs financial data? Department Chairs/Directors Presidents/ Deans / VP’s Board of Trustees Strategic Loop Target Setting & KPI’s Adjust Operations Scenario Modeling Operations Loop Budgeting & Forecasting Department Administrators Faculty Academic Administration • How will it all fit together? • Policy / Procedure • Data • Technology • Measures • Processes • Organization Consolidation and Reporting Reporting Loop Data Mart/ Dashboards Departmental Reporting Business Systems Session 9 - Capstone

15. University Financial Management Challenges • Manually intensive effort • Redundancy in data and reporting streams • Inconsistent Data Model and Standards • Numerous Data locations • Spreadsheet Proliferation • Poor access to information • Overall process is cumbersome Session 9 - Capstone

16. How Are Institutions Meeting the Challenge? • A growing number of universities are embarked on a multi-year process to enhance the financial management activities in order to provide timely and efficient financial results with a high level of integrity and flexibility. Common steps in the process are… Reduced data manipulation to provide increased control and analytics Created easy, prompt sophisticated business queries Automated routine activities for data collection and processing Self-service user-oriented tools for on-line, real time analysis Created flexible, timely, and accurate delivery of information Consistent information & reporting standards across business units Eliminated redundant non value added activities Powerful visualization capabilities Session 9 - Capstone

17. This Leads to Overall Financial Framework and Best Practices • Financial / Tactical Plan • Financial Plan of action for achieving goals • Profit & Loss/ Cash Flow Impact of investing in new recruits, facilities, equipment, I/T, etc. • Departmental Business Plans (Programmatic & Financial Goals) • Strategic Planning • Vision for the Future • Strategic Goals and Objectives • Programmatic initiatives • Accountability • Performance vs. Goals • Strategic & financial goals • Dept -> Division -> Investigator • Faculty Compensation Plan • Resource Re-allocation • Internal Funds • Space • Annual Budget: • Operationalize strategy through the annual budget process • Setting priorities when aligning resources to achieve goals • Mission-based / All Funds Budget • Performance Management • Measurable Goals • Key Performance Indicators • Balanced Scorecards • Accuracy– Systems/ Data Management Session 9 - Capstone

18. University Reporting Processes • A critical step to solving the financial management challenge is the establishment of effective university consolidated reporting: Consolidation/ Close Financial Reporting 1. All transaction based activities complete 2. General ledgers finalized 3. All data is final for reporting 4. Reports completed & distributed Month-End Accounting Financial Consolidation Sub-Ledgers Reporting SOURCE DATA/SYSTEMS Tuition / Fees / Gifts Income Accounts Receivable Federal /Non-Fed Grants & Contract Asset Management Payroll Purchasing / Accounts Payable Treasury/Cash Management REPORTING Spreadsheets External Reports – (FSR’s, 990’s …) Ad hoc analysis Data Warehouse Reporting Visualization Segment Reporting Operational Reporting JUDGEMENTS & ESTIMATES Acct. Reconciliations Interdepartmental Accounting Accounting Adjustments Accruals and Reserves Service Center & Research Cores Acct. CONSOLIDATION ACTIVITIES Intercompany Eliminations Investment Accounting Consolidation Investment earnings Accruals Top-side Adjustments Pledge Receivable Adjustments Management Reporting Data/System Integration

19. Financial Management Building Blocks • Throughout our training sessions we described the establishment of the integrated set of components (“Building Blocks”) that comprise the University financial management environment is essential to developing an efficient and effective financial reporting capability. Real Time Reporting requires: Analytical Analysis Required “views” of financial information (e.g., campus, school, center, department, mission, etc.) • Timeliness • Controls • Integrity • Efficiency • Flexibility Performance Measures Key financial and non-financial operational metrics, balanced scorecard reporting Chart of Accounts ‘Master file' for financial data that is used to derive financial reports Reports Types of reports, report formats, content and volumes Reporting Tools / Architecture Technology and tools used to source, consolidate, deliver and access information Organization / Skills Finance structure, staff analytical skills, capability development, department administrator integration etc. Data Model Standards, data quality & integrity, integration Procedures/Process Internal Controls, account usage, capitalization policy, process flows, procedural steps, training documents, etc Session 9 - Capstone

20. Summary • Best results occur when all of the “building blocks” are addressed • Alignment with overall business strategies and objectives at the department level is essential • Technology solution is critical but is usually only one component of the solution • Need to address on going controls, standards, data quality, process and organizational responsibilities Session 9 - Capstone

21. Q&A Session Questions and Discussion Session 9 - Capstone

22. Track 5 Graduates Session 9 - Capstone

23. Track 6 Graduates Session 9 - Capstone

24. Track 7 Graduates Session 9 - Capstone

25. COURSE EVALUATION Session 9 Please complete course evaluation form. Session 9 - Capstone