Commitment Control Overview July 10, 2014 FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

Team Introductions 2FI$Cal: Transparency. Accuracy. Integrity. KK Overview - Session Panel:  Jeff Brandyberry  Rebecca King  Gina Kwong-McGee  David Smart  Joel Zabramba Presentation authors:  Rebecca King and Joel Zabramba Presentation contributors:  Kirk McCain and Jeff Brandyberry  Jeffrey Haisley  Carmen Fernandes and Angelique Rust Commitment Control Overview – 10JUL2014

3FI$Cal: Transparency. Accuracy. Integrity.  Session Objectives  What is Commitment Control (KK)?  How does KK execute Budget Checking  KK Budget Definition – Concepts/Terms  KK Budget Checking – Concepts/Terms  Where is Budget Checking recorded?  KK Budget Inquiry and Reporting  KK Budget Checking Exceptions  Commitment Control Overview – Recap  Commitment Control Budgets – Go Live & Beyond  Questions Commitment Control Overview – 10JUL2014

Session Objectives 4FI$Cal: Transparency. Accuracy. Integrity.  To provide Departments with a non-technical overview of how Commitment Control (KK) functionality within PeopleSoft works.  To provide Departments with specific details regarding FI$Cal setup and use of PeopleSoft Commitment Control functionality. Commitment Control Overview – 10JUL2014

What is Commitment Control (KK)? 5FI$Cal: Transparency. Accuracy. Integrity. Commitment  Budget  Budgetary Control Checking Control Commitment Control is the structure and rules setup that defines the budget checking process. Commitment Control enables an organization to budget check its transactions against predefined budgets to achieve budgetary control. Commitment Control Overview – 10JUL2014

What is Commitment Control (KK)? 6FI$Cal: Transparency. Accuracy. Integrity.  Control Tool – to prevent spending outside of authorizations.  Management Tool – to record and monitor activities ('actuals') against budgeted targets.  Reporting Tool – to produce reports on budgets and related activities ('actuals' and remaining spending authority). Commitment Control Overview – 10JUL2014

Commitment Control – Transaction Flow 7FI$Cal: Transparency. Accuracy. Integrity. Lag Validate ChartFields Commitment Control Ledgers Enter Transaction Modified Accrual Ledger Approve Budget Checking Post Commitment Control Overview – 10JUL2014

How does KK execute Budget Checking? 8FI$Cal: Transparency. Accuracy. Integrity.  KK structure and budget checking processing rules are set up in the system.  Budget Period Calendar  Establishes the begin and end date for each budget period.  KK Ledgers  Store budget amounts.  Store 'actuals' amounts that have been successfully budget checked.  KK Translation Trees  Enables budgeting at higher levels than the chartfield detail value used for 'actuals' transactions.  KK Budget Definitions  Defines control options, required chartfields (keys), budget level by chartfield (translation), other budget checking rules (e.g. excluded account types/accounts). Commitment Control Overview – 10JUL2014

Budget Period Calendar 9FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Translation Tree – Reporting Structure chartfield 10FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Definition – Appropriations 11FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Definition – Concepts/Terms - - Control Option 12FI$Cal: Transparency. Accuracy. Integrity. Every Budget Definition must select a Control Option: Control or Track with Budget or Track without Budget  Control:  Transactions that exceed the available budget will error out during the budget checking process.  No further processing can be performed until the transaction error is corrected by an authorized user or the budget is overridden by an authorized user. Commitment Control Overview – 10JUL2014

KK Budget Definition – Concepts/Terms - - Control Option 13FI$Cal: Transparency. Accuracy. Integrity.  Track with Budget: Verifies transactions by checking for a corresponding match of the ‘actuals’ chartfields to budget chartfields and NOT on monetary amount.  If there is no corresponding budget, fail budget checking.  If a corresponding budget exists, even for a zero amount, pass budget checking, but issue warnings.  Track without Budget: Track transactions even if there is no budget set up. All transactions pass without error.  If there is no budget, transaction passes budget checking.  If a corresponding budget exists and there are exceptions, pass budget checking and issue warnings. Commitment Control Overview – 10JUL2014

KK Budget Definition – CC_APPROP - - Control Option 14FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Definition – Concepts/Terms - - Keys 15FI$Cal: Transparency. Accuracy. Integrity.  Definition: Budget Keys are the ChartFields which are required for all budget journals and all transactions for a given budget structure. Example: CC_APPROP (Appropriations) Budget Keys  Account  Appropriation Reference  Fund  Year of Enactment  Program  All Appropriations budget journals must include these ChartFields.  To pass Appropriations budget checking, all 'actuals' transactions must include these ChartFields. Commitment Control Overview – 10JUL2014

KK Budget Definition – CC_APPROP - - Keys 16FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Definition – Concepts/Terms - - Translations 17FI$Cal: Transparency. Accuracy. Integrity.  Definition: Budget translations enable budgeting at a higher level than the transaction detail value for that chartfield. The translation is accomplished through the use of trees. Example: CC_APPROP (Appropriations) Translations  Account  Budgeted at Level 4  Transact using the detail Account values  Program  Budgeted at Level 3  Transact using the detail Program values  Budget checking of Appropriations requires an Account translation tree and a Program translation tree so that the budget checking process can ‘find’ the budget amount related to the detail transaction value. Commitment Control Overview – 10JUL2014

KK Budget Definition – CC_APPROP - - Translations 18FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Translation Tree – Account chartfield 19FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Translation Tree – Program chartfield 20FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

How does KK execute Budget Checking? 21FI$Cal: Transparency. Accuracy. Integrity.  Budget journals are entered and recorded to the applicable KK budget ledger.  Budget journals use required chartfields as well as the chartfield values at the translation level specified in the budget definition.  ‘Actuals’ transactions (e.g. requisitions, purchase orders, vouchers, journal entries) are budget checked.  Budget checking for ‘Control’ budget definitions will compare the 'actuals' amount with the remaining spending authority (RSA) for that chartfield combination.  All applicable budget definitions execute simultaneously when budget checking a transaction. If any error out, the transaction will have failed budget checking.  ‘Actuals’ transactions that ‘pass’ budget checking are recorded in the KK Ledgers. Commitment Control Overview – 10JUL2014

KK Budget Checking – Concepts/Terms - - RSA 22FI$Cal: Transparency. Accuracy. Integrity.  FI$Cal Appropriations Remaining Spending Authority (RSA): Budget Encumbrances Expenditures + Associated Revenue Collected RSA Commitment Control Overview – 10JUL2014

KK Budget Checking – Concepts/Terms - - Budget Journal 23FI$Cal: Transparency. Accuracy. Integrity.  Budget Entry Type – An identifier that classifies various types of budget journal transactions, including:  Original budget – the initial recording of approved budgeted amount  Budget adjustment – An increase or decrease in a budgeted amount  Budget transfer – The transfer of a budgeted amount within the same Department  Budgetary Only ChartField Value – A ChartField value that can be used in a Budget Journal but not in a financial ‘actuals’ transaction. Commitment Control Overview – 10JUL2014

KK Budget Checking – CC_APPROP - - Budget Journal 24FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – CC_APPROP - - Budget Journal 25FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – CC_APPROP - - Budget Journal 26FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking - - Budget Journal - - Budget Details 27FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking - - Budget Journal - - Budget Activity Log 28FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking - - Budget Journal - - Budget Activity Log 29FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

Where is Budget Checking recorded?  ‘Actuals' transactions that are successfully budget checked are recorded in the KK Ledgers.  Budget checking a Requisition records the transaction in a KK Pre-Encumbrance Ledger.  Budget checking a Purchase Order records the transaction in a KK Encumbrance Ledger. If a Requisition is used to create the Purchase Order, then budget checking the Purchase Order will ‘relieve’ the Requisition amount previously recorded in the pre-encumbrance ledger.  Budget checking an AP Voucher or a GL Journal Entry records the transaction in a KK Expenditure Ledger. If a Purchase Order is used to create the Voucher, then budget checking the Voucher will ‘relieve’ the Purchase Order amount previously recorded in the encumbrance ledger. 30FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – Concepts/Terms - - KK Ledgers Pre-Encumbrances Ledger Expenditures Ledger Budgets Ledger Purchase Orders + / - Vouchers (AP) Budget Journals GL Journals LedgersLedger ImpactTransaction Types + + FI$Cal: Transparency. Accuracy. Integrity. 31 Encumbrances Ledger Requisitions Commitment Control Overview – 10JUL2014

KK Budget Checking – Concepts/Terms - - KK Ledgers Receivables Invoices LedgersLedger ImpactTransaction Types FI$Cal: Transparency. Accuracy. Integrity. 32 Recognized Revenue Commitment Control Overview – 10JUL Misc. Receipts Receivables Payments Misc. Receipts Receivables Payments Budget Journals Collected Revenue Revenue Estimate

KK Budget Checking – Budget Inquiry and Reporting 33FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – Budget Inquiry and Reporting 34FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – Budget Overview - - Criteria 35FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – Budget Overview - - Search Results 36FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – Budget Overview - - Budget Details 37FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – Budget Overview - - Activity Log 38FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – Budget Overview - - Activity Log 39FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – Budget Status Report 40FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – Budget Status Report 41FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – Budget Exceptions 42FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – Budget Exceptions 43FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

KK Budget Checking – Budget Exceptions 44FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014 Common Budget Exceptions [ CF = chartfield ] Description Tools/Steps to research/resolve [ DBO = Dept Budget Office ] Exceeds Budget Tolerance Transaction amounts are over the spending authority of a ‘controlled’ budget. Review CF values, if not correct – update. If correct, review RSA. Contact DBO to request alternate CF values or budget update. No Budget Exists No established budget is found for the CF values used in the transaction. Review CF values, if not correct – update. If correct contact DBO to request alternate CF values or entry of budget journal. Required key CF is blank Budget requires a chartfield (Key) that is blank in the transaction. Review transaction. Determine appropriate chartfield value to use in place of blank. Translation Tree error Transaction CF value is rolling up to a budgetary value that is not at the right level of the tree or doesn’t exist on the tree. Review CF values, if not correct – update. If correct, contact COA Maintainer to request resolution to tree roll-up error. Budget is Closed Process has been executed to ‘close’ the budget to prevent further charges using those CF values. Review CF values, if not correct – update. If correct, contact DBO to request alternate CF values or action to re-open budget.

Commitment Control Overview - Recap 45FI$Cal: Transparency. Accuracy. Integrity. Budgetary control is enforced on ‘actuals’ transactions in all FI$Cal modules through the use of KK structure/rules and the budget checking process. Budget Checking Process Journal Posting Process Commitment Control Ledgers Distribution Lines from Transactions Journals – GL Requisitions - PO Purchase Orders – PO Vouchers – AP Bill – Billing Deposit - AR Modified Accrual Ledger Budgets Pre-Encumbrances Encumbrances Expenditures Revenue Estimate Revenue Recognized Revenue Collected Commitment Control Overview – 10JUL2014

Commitment Control Budgets – Go Live & Beyond  FI$Cal is using KK to support the establishment of spending authority at differing levels within state government.  Appropriation and LTD Project budget balances will be converted for the Wave 1 departments.  Department of Finance will create and approve Appropriation Hyperion budget requests. These budget requests will be posted in FI$Cal KK to establish Appropriation spending authority.  Departments will document operating budget amounts utilizing the current business process. The amounts will be posted to FI$Cal KK using budget journals to establish Department spending authority. 46FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014

Questions 47FI$Cal: Transparency. Accuracy. Integrity. Commitment Control Overview – 10JUL2014