Including the Revenue Account in Cost Based COPA at

Overview The TELUS solution –Background –Alignment of the Product and Revenue Account Hierarchies –Enhancements –Derivation Strategy –Revenue Interface –Reconciliation

I found the difference! Who Cares? We have a passion for growth

Reconciliation by Company Code.

Reconciliation by Profit Center

Reconciliation by Revenue Account

Finance, Regulatory, and Marketing all provide evidence to the regulator. How we got here

The numbers are all different!!!!

Which figure is correct?

We have the courage to innovate Billed vs Earned View, Product Definition, Customer Definition, Timing. Why can’t there be a central source for all revenue information? A Central Source of Revenue Information

Integration of Management and Financial Reporting. We believe in spirited teamwork

PCA and PA Reporting

GL Revenue Account Structure

Product Hierarchy

Product Hierarchy level 1 to 3  EPP1 – Categorization of Portfolio Groups based on service capability or functionality.  Portfolio Group (EPP2) – Categorizations of Portfolio Sub-Groups that differentiates functionally within EPP1, while still aligning with external financial reporting structures.  Portfolio Sub-Group (EPP3) – Categorizations of Product Portfolios as viewed by Telecommunications/IT sectors industry analysts

Product Hierarchy level 4 to 6  Portfolio – A grouping of Product Families with similar application or functionality  Family – A product/service managed by a Product Manager and recognizable by a customer.  Line – A sub-Family definition of a product/service specific to that product/service.

Product Hierarchy - Materials  Material Code/Product – 2 material types in SAP SAP inventory or billing materials SAP materials representing external non-SAP billing system codes

Material Master

Portfolio/Family/Line

Data Model  Enterprise Product Primeship  Portfolio Group  Portfolio Sub Group  Portfolio  Family  Line  Material Revenue Account Revenue Account Regulatory Groupings Regulatory Groupings

Master Data Maintenance Corporate Marketing maintains the Product and Customer Hierarchies and maintains the Material Master for products and services billed outside of SAP. Corporate Accounting maintains the Revenue Account, the Revenue Account Hierarchy, the relationship between the Product Hierarchy and the Revenue Accounts. Supply maintains the Material Master for SAP Inventory and Billing.

Revenue Interfaces Create MIC Download Revenue Interfaces Revenue Interfaces Revenue Items Revenue Items MIC Table Mass Market Billing Systems Mass Market Billing Systems SAP FI/PCA SAP COPA SAP Material Master SAP Derivation Tables Data Warehouse

Direct FI Entries Pulled from FI into COPA

Direct FI Entries Edited

Derivation Strategy

Consolidated Settlement –In the TELUS configuration an object can be posted to by Direct FI entries and SD Orders and subsequently settled to COPA as a single line item. This typically occurs for SM Orders, Internal Orders and Revenue Projects. –In these cases the link between the Revenue Account used in the posting to the object is lost when settlement to COPA takes place.

Split program For each object with consolidated settlement. –Reverse the associated PA Posting. –Repost the PA entries with one line for each PCA Revenue Account posting.

Reconciliation formula Unsettled Amounts –PA will be understated in the current period and overstated in the subsequent period. –In order for revenue to reconcile by Revenue Account all revenue objects must be settled in the current period. –In order for revenue to reconcile by CC, TP, PC, and Plant the unsettled amounts must be posted to a WIP Offset Account.

Reconciliation formula + PCA Amount + Previous WIP amount + Previous Unsettled Amount - Current WIP Amount - Current Unsettled Amount + PA Amount PCA – PA Variance 000 1,000,000 - cr 100,000 + dr 100,000 - cr 300,000 + dr 300,000 - cr 1,000,000 + cr

Reconciliation formula + PCA Amount* + Previous WIP amount + Previous Unsettled Amount - Current WIP Amount - Current Unsettled Amount + PA Amount PCA – PA Variance 1,000,000 - cr 100,000 + dr 100,000 - cr 300,000 + dr 320,000 - cr 1,000,000 + cr 20,000 - cr * Includes all the Revenue Accounts including the WIP Offset Account

Reconciliation Errors Unsettled Objects Consolidated Settlement Direct FI Postings with no valid object PCA Only re-postings PA Only postings. Changes

Correction Process – COPA Only

Account based COPA Ensures postings are made to FI and PA at the same time. Intended for reconciliation to a highly aggregated level. Supports reconciliation by Cost Element rather than Revenue Account. –Secondary Cost Elements are used for settlements.

Reconciliation System Design Reconciliation Data Base BSEGGLPCACE1….

Recon Tools - Summary

Recon Tools by Account

Recon Tools PC/Act

Reconciliation Details The Detail Analysis Tool retrieves data directly from BSEG, GLPCA, and CE1….

Reconciliation Details

SAP Development Request Include the revenue account in cost based COPA. Include a partner revenue account for header level settlement. –Normalize the PA segments so there is a PA line item for each PCA revenue line item. We embrace change and initiate opportunity

ASUG Support –Through the Finance Influence Council submit your request for an enhancement to R3 to include the Revenue Account in Cost Based COPA.

Thank you for attending! Please remember to complete and return your evaluation form following this session. Session Code: 1711