page Federal Contracting Self-Certification Compliance Using Your ERP System May 9, 2013 Midwest SBLO Group

page Self-Certification Requirements Presented by Ray Suennen Governmental Contracts Compliance Coordinator Integrys Energy Services, Inc 1

page Self-Certification Requirements eSRS Instructions Quick reference # 3 you must have a supporting written size self- certification for every small business you are counting in the small business and socioeconomic section of this report at the time you submit your proposal Per 13 (CFR) (e) &

page Self-Certification Requirements eSRS Instructions Quick reference # 3 a subcontractor must qualify and self-certify as a small business at the time it submits its offer as a small business subcontractor. Per 13 CFR (a) 3

page Self-Certification Requirements Representations & CertificationsFAR (b)(1) Prospective contractors shall update the representations and certifications submitted to ORCA as necessary, but at least annually; to ensure they are kept current, accurate, and complete. The representations and certifications are effective until one year from date of submission or update to ORCA. 4

page Self-Certification Requirements Small Business Subcontracting Plan The achievement of the goals of a small business subcontracting plan are measured by the percent of a Contractor’s subcontracting Spend with socioeconomic business concerns The validity of the Spend percents, is based upon the supporting representations and certifications, which are primarily received directly from the subcontractors 5

page Self-Certification Requirements The following process was developed for a commercial Subcontracting Plan. The process can also be used for an individual plan by adding project numbers. 6

page What “Tools” do you need to use existing systems? Maintaining self-certifications can be done in-house, it will involve; System enhancements (not complex) IT Programmer Your “Time” Understanding of FAR requirements Leaderships willingness to modify systems Business case 7

page What “Tools” do you need to use existing systems? Maintaining self-certifications can be done in-house, it will involve; Business case (reasons why – Compliance with FAR Control of data Accessibility (ease and timing) Cost – ongoing is limited Security – no external parties involved Confidentiality of Company data 8

page What “Tools” do you need to use existing systems? Summary of what it takes; One-Time Set Ups Add fields to store data in the system Create reports to pull the data from the system Annual Updates Mailing self-certification classification request forms Updating the purchasing system from the returned self-certification forms 9

page What “Tools” do you need to use existing systems? Systems involved Purchasing system – has vendor information Accounts payable system – has dollars spend by vendor General ledger – has total company spend (note - PeopleSoft ERP system is used) 10

page What “Tools” do you need to use existing systems? Purchasing System Already contains individual vendor records Vendor name Vendor address Vendor number (primary key field) Vendor “type” (VIP field) DUNS number (may not be used) This information is used for the mailing of the “Request to Update Self-Certification Form” 11

page What “Tools” do you need to use existing systems? Purchasing System The vendor “Type” field Allows for users to set up desired identifiers (existing functionality) One vendor can have multiple vendor types May have a limited number of characters (3) Need a group of codes that you “own” Everything that starts with a “Y” and “Z” 12

page What “Tools” do you need to use existing systems? Purchasing System Vendor “type” field Create and set up vendor codes; ZDB – Small Disadvantaged Bus ZHZ – HubZone Business ZDV – Disabled Veterans (service-disabled V/O S/B) ZVO – Veteran Owned S/B ZWO - Women Owned S/B 13

page What “Tools” do you need to use existing systems? Purchasing System Vendor “type” field Create and set up vendor codes; Z8A – Business Development ZBC – Black Colleges & Universities ZMI – Minority Institutions ZFO – Foreign Owned ZFQ – Foreign Qualified 14

page What “Tools” do you need to use existing systems? Purchasing System Vendor “type” field Create and set up vendor codes; ZLT – Long-Term Contracts For Supplier Diversity reporting YMO – Minority Owned Large Bus. YMO – Women Owned Large Bus. 15

page What “Tools” do you need to use existing systems? Purchasing System Vendor “type” field Create and set up vendor codes; ZLB – Large Business ZEE – Employee Expenses ZIC – Inter-company payment (affiliated companies) ZCU – Customer refunds etc 16

page What “Tools” do you need to use existing systems? Purchasing System is the only system needing enchancements Need to add “Fields” to the tables Self-certification “Classification Date” Long-Term Contract Start Date Long-Term Contract End Date Certification Ending Date (8A & HUBZone) NAICS Code 17

page What “Tools” do you need to use existing systems? IT Programmer Needs to create reports to retrieve the data Self-certifications Classification Update form Size Spend Report Type Spend Report Expired Classifications Report Subcontracting Income Statement Report Create online viewing capabilities screen of vendor accounts 18

page Reports Self-certifications Classification Update Form Creates a form to be mailed to the vendor Criteria - must have Spend within the current year – from accounts payable sys. (you input the desired to/from dates) Retrieves from the purchasing system the existing classification codes, last date update, NAICS code, DUNS #, name and address (it is ready for mailing) 19

page Reports Self-certifications Classification Update form The returned form contains the Signature of the authorized person Date signed (new classification date) Updated classification codes Additional information may include DUNS, NAICS, product description 20

page Reports Self-certifications Classification Update form Forms are not sent to Large Businesses Customers Employees Affiliated companies 21

page Reports eports Size Spend Report (used for reviewing purposes) Retrieves by the First Tier Hierarchy ZSB – with current classification dates ZSB – with expired classification dates ZLB – all large business spend ZIC – Affiliated company spend ZEE – Employee spend blank – All companies without classification codes (Excel Spreadsheet) 22

page Reports Type Spend Report (Excel Spreadsheet) This report provides the Socioeconomic Spend amounts for the eSRS Small Business Subcontracting Report SDB Spend for the Year-End Supplemental Report for Small Disadvantaged Businesses 23

page Reports Type Spend Report (Excel Spreadsheet) Retrieves Spend (input to/from Spend dates) Vendor name Vendor number NAICS code Spend by classification code; Small Business not preferential Z8A – Business Development Black Colleges & Universities 24

page Reports Type Spend Report (Excel Spreadsheet) Retrieves Spend Spend by classification code; Minority Institutions Small Disadvantaged Business HUBZone business concerns Service Disabled Veteran S/B Veteran Owned S/B Women Owned S/B 25

page Reports Type Spend Report (Excel Spreadsheet) The report totals the Preferential Spend categories (includes multiple spend credits) Multiple counted Spend Credits The difference is the actual Spend (only counted once) which equals the Spend on the Size Spend Report 26

page Reports Subcontracting Income Statement Report This report provides the Total Revenue and the Total Subcontracting Spend for the Subcontracting Reports (eSRS) Subcontracting Plans 27

page Reports Subcontracting Income Statement Report Retrieves from the accounting system (for the to/from period input) An income statement Net change in the Fixed assets Inventory May be other asset accounts 28

page Reports Subcontracting Income Statement Report The report Adds back - discontinued operations Subtracts; Intercompany expenses Non-cash items (depreciation, amort.) Non-subcontractable items (employee) = Total Subcontracting Spend 29

page Reports Expired Classifications Report Provides a list of vendors that have no - classification codes or - outdated socioeconomic classification codes Identifies Spend (input to/from period) Can be ran at any time Is used to identity which vendors to follow up on, especially if Spend is significant 30

page What “Tools” do you need to use existing systems? Your “Time” There are trade offs here Invest time to set up (up front) Information almost immediately available You control all of the data You control when you pull the data No external party has access to your system information (big issue with our company – security and confidentiality) 31

page Self-Certification Compliance Using Your ERP System Summary The process Is easy to use Is totally in your control Is available to use at any time Has checks and balances Provides solid verifiable documentation Easy access to outdated Classifications 32

page Self-Certification Compliance Using Your ERP System Summary The process If updated every 12 months, is current Meets the criteria of accurate and complete Meets the requirement of - you must have a supporting written self-certification Personal opinion;I feel that in the long-term, it provides cost savings 33

page Summary What are your questions and comments? 34