1. Cowlitz County, WA Accounting Function Review
Board of County Commissioners
Study Session
November 24, 2015

2. Cowlitz County, WA Accounting Function Review
Agenda
Review Objective & Process
Background & Context
Principal Observations
Primary Opportunities
Questions/Discussion
November 24, 2015
Cowlitz County, WA Accounting Function Review

3. Review Objective & Process
Assess the opportunity for Cowlitz County accounting functions to become more efficient or effective
November 24, 2015
Cowlitz County, WA Accounting Function Review

4. Review Objective & Process
Review Process
Met with “major” departments to understand accounting functions performed and to get input on potential improvement opportunities
Analyzed accounting transaction, expenditure and staffing data for
Researched GFOA best practices related to selected accounting functions
November 24, 2015
Cowlitz County, WA Accounting Function Review

5. Review Objective & Process
Review Process
Met with PeopleSoft implementation consultants to understand their perspective on how the new software modules and software upgrade will impact efficiencies and effectiveness
Contacted four other counties to gather data on their staffing and organization related to selected accounting and finance functions
November 24, 2015
Cowlitz County, WA Accounting Function Review

6. Cowlitz County, WA Accounting Function Review
Background & Context
Study requested by Board of Commissioners and facilitated by County Auditor
Not a new topic for Cowlitz County or other counties
Reviewed by Cowlitz County in 2000
Reviewed by other counties recently
Completing significant software upgrade
Major upgrade and five new modules
Many streamlined and new processes
Significant County investment: $3 million +
November 24, 2015
Cowlitz County, WA Accounting Function Review

7. Cowlitz County, WA Accounting Function Review
Background & Context
­Accounting functions definition
­Processing of accounts payable, payroll, accounts receivable and/or tracking grant revenues and expenditures
Includes recording and compiling financial activity for County staff or other organizations
Some overlap with “finance” functions: planning and decision-making based on financial activity
Focus on larger departments: 81% of expenditures and 67% of 2014 transactions
November 24, 2015
Cowlitz County, WA Accounting Function Review

8. Cowlitz County, WA Accounting Function Review
Background & Context
November 24, 2015
Cowlitz County, WA Accounting Function Review

9. Cowlitz County, WA Accounting Function Review
Background & Context
November 24, 2015
Cowlitz County, WA Accounting Function Review

10. Principal Observations
Functional Consolidation
­The opportunity for efficiency through consolidating accounting functions is limited
Accounting activity is already concentrated in larger departments where there is also dedicated staffing resources
Accounting transactions per estimated accounting FTE is higher in larger departments
Accounting work is highly integrated with program operations in all departments but especially smaller ones
November 24, 2015
Cowlitz County, WA Accounting Function Review

11. Principal Observations
Current/Former Process Challenges
Accounts payable process is paper driven and processed in batches
Department time sheet review/correction process is cumbersome
Financial reports are difficult to obtain
Many departments use separate Excel spreadsheets or data bases to track activity
Detailed and real time information on accounts receivable and revenue is lacking
November 24, 2015
Cowlitz County, WA Accounting Function Review

12. Principal Observations
Current/Former Process Challenges
Internal services billing process is time consuming and paper driven
Accounting and finance support department roles are not always clear
Limitations on process and timing for new employees to be set up in the payroll system
November 24, 2015
Cowlitz County, WA Accounting Function Review

13. Principal Observations
PeopleSoft Implementation
­PeopleSoft implementation has/will streamline many accounting and related processes and should deliver staff time savings
“Procure to Pay”: automated approvals and streamlined accounts payable processing
Automated internal billing
Time and Labor: Better payroll time reporting – CHAMPS replacement
Streamlined Personnel Action Form processing
November 24, 2015
Cowlitz County, WA Accounting Function Review

14. Principal Observations
PeopleSoft Implementation
­PeopleSoft implementation should support enhanced financial management
Expanded Projects Module functionality and use – especially with grants
Better access to financial data (assuming reports and training are provided)
Ability to analyze data to identify opportunities for savings or other efficiencies­
Enhanced budget support/controls
November 24, 2015
Cowlitz County, WA Accounting Function Review

15. Principal Observations
PeopleSoft Sustainability Challenges
The County faces several challenges in fully realizing the benefits of its system investment
Single source expertise
Limited support resources focused on system maintenance and not enhancements
High skill level and experience in most areas but not a lot of depth
Unclear ability to sustain cross-department work groups that made implementation a success
November 24, 2015
Cowlitz County, WA Accounting Function Review

16. Principal Observations
PeopleSoft Sustainability Challenges
PeopleSoft consultants recommended that the County address staffing gaps and succession risks:
Controller
Human Resources/Benefits Analyst
Project Costing and/or Grants Analyst
Additional staff resources to support purchasing and asset management
November 24, 2015
Cowlitz County, WA Accounting Function Review

17. Principal Observations
Other County Experience
November 24, 2015
Cowlitz County, WA Accounting Function Review

18. Principal Observations
Other County Experience
November 24, 2015
Cowlitz County, WA Accounting Function Review

19. Principal Observations
GFOA Best Practices
Grant Management
Encourage multi-disciplined review
Have administrative support/systems in place
Purchasing Cards
Consider using to improve the efficiency of the purchasing process – especially for small amounts
Have written policies and procedures that are updated regularly
Make sure systems are in place to monitor use
November 24, 2015
Cowlitz County, WA Accounting Function Review

20. Principal Observations
GFOA Best Practices
Indirect Costs/Internal Charges
Use team approach to developing/updating
Review with “customers” annually
Payment Consolidation
Consider using payment consolidation to improve the efficiency of the payment collection process
Complete a cost-benefit analysis of any proposal
Review/make system and process changes
November 24, 2015
Cowlitz County, WA Accounting Function Review

21. Primary Opportunities
Efficiencies
Limited opportunity for direct cost savings but new capacity will be created
“Substitution” effect of streamlined processes and better access to more data
Time saved on accounting functions & other tasks to be redeployed to support program delivery
Time saved in extracting and manipulating data to be redeployed to analysis and result in better information and decisions
November 24, 2015
Cowlitz County, WA Accounting Function Review

22. Primary Opportunities
PeopleSoft System Functionality
Realizing opportunities associated with new functionality will require ongoing investment
New positions to create depth of expertise, train users and support new reports/features/processes
Adequate system administration & user support
Time for existing staff to develop and share their expertise in specific modules
Assessment/implementation of new modules
IT support for maintenance and upgrades
November 24, 2015
Cowlitz County, WA Accounting Function Review

23. Primary Opportunities
Other Opportunities
Explore use of remittance processor for utility bills and property tax payments
Explore expanded use of Projects module in Public Works and grant accounting
Clarify accounting/finance support roles and document policies and procedures
Review and use GFOA best practices for grant management, purchasing cards and cost allocation plans
November 24, 2015
Cowlitz County, WA Accounting Function Review

24. Questions/Discussion
Acknowledgements
Report Availability
Questions/Discussion
Thank you!
November 24, 2015
Cowlitz County, WA Accounting Function Review