FIN-01-02-04 Business Sub-Process Design Document

Execute project plan and budget project

FIN-01-02-04 Business Sub-Process Design

Document
Execute project plan and budget project

Project Acadia
May 2012

CONFIDENTIAL

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 FIN-01-02-04 Business Sub-Process Design Document
Execute project plan and budget project

TABLE OF CONTENTS
1 Document History....................................................................................................................... 3
1.1 Revision History..................................................................................................................... 3
1.2 RASCI.................................................................................................................................... 3
1.3 Approval Detail...................................................................................................................... 3
1.4 Related Documents............................................................................................................... 3
2 Business Process Overview:..................................................................................................... 4
2.1 Key Principles and Objectives............................................................................................... 4
2.2 Key Assumptions................................................................................................................... 4
3 Business Process Scenarios:.................................................................................................... 6
3.1 Definitions, Acronyms, Terminology.....................................................................................11
4 Business Process Diagram...................................................................................................... 12
4.1 Process Diagram................................................................................................................. 12
4.2 Activity List........................................................................................................................... 14
4.3 Inputs................................................................................................................................... 15
4.4 Outputs................................................................................................................................ 15
5 Process Variations.................................................................................................................... 15
5.1 Business Unit Led Variations...............................................................................................15
5.2 Geography/Legal Entity Led Variations................................................................................15
6 Role Definition & Organizational Impact.................................................................................15
6.1 Role/Skill Class Inventory.................................................................................................... 15
6.2 Organizational Impact.......................................................................................................... 16
7 RICEFW...................................................................................................................................... 16
7.1 Reports................................................................................................................................ 16
7.2 Interfaces (Inbound / Outbound).......................................................................................... 16
7.3 Conversions......................................................................................................................... 17
7.4 Enhancements..................................................................................................................... 17
7.5 Forms.................................................................................................................................. 17
7.6 Workflows............................................................................................................................ 17
8 Other Issues / Gap List............................................................................................................. 19
8.1 Other issues, Gaps, and outstanding points........................................................................19

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1. Document History
1.1 Revision History

Ver. Date Summary of Changes Author

0.1 5/21/2012 Initial Draft Created Dana Keith
0.2 6/05/2012 Team lead review Franck Poisson
Mike Lawson

1.2 RASCI

RASCI Role Name Phone

R Sr Projects Analyst Mike Manson
A Business Team Lead Angela Shalkhauser
A GBT Team Lead Mike Lawson
S/C Accenture Team Lead Franck Poisson
S Accenture Integrator Dana Keith
I Business SMEs Vicky Fitzgerald, Tom Knowlton

R: Responsible; A: Accountable; S: Support; C: Contribute; I: Information;

1.3 Approval Detail

Review # Date Name & Position of Approver Signature

06/03/2012 Angela Shalkhauser
06/05/2012 Team Leads Franck Poisson
Solution Architect
Master Data Adivsory Council (if Master Data
related)

1.4 Related Documents

Please insert links/References to related Documents (issues, data entities, etc.).>

Related Document Comment

Include Central Issue List
Include Central RICEFW list
Include Existing Assets (AAES, Prior
Blueprint)

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2. Business Process Overview:

2.1 Key Principles and Objectives

Solution Objectives

In building the solution for VFC Project Systems (and Investment Management), the following overall
objectives are relevant:

Discontinue use of standalone internal orders as capital and expense tracking vehicles and replace
with projects that allow hierarchical grouping of multiple related sub-projects
The solution must facilitate better project cost tracking, control and reporting (provide consistent tools
and methodologies for managing projects)
Have the ability to reflect true cost of a project excluding internal labor (internal labor may be in the
scope of a future project)
An individual project needs to be able to contain costs that are eventually settled into assets AND/OR
expense, or be setup as a statistical object with real costs going to a cost center
Ensure there is budget control for capital portion of projects.
Reporting should be available to monitor actuals against budget, and actuals against plan for capital
and expense components

SAP PS Overview

VFCs business requires projects to be used in support of the capital planning process, in conjunction with the
Investment Management module. At this time there are no requirements for projects to support revenue-
producing business scenarios. Defined global project types will promote consistency across the enterprise
and will allow for more meaningful comparisons.

The Execute Project Plan and Budget Project business process focuses on the budgeting and planning of
projects that will be tracked using the SAP Project Systems (PS) module. The main elements of this process
are as follows:

1) Plan versus budget

a) Purposes
2) Budget
a) Original
b) Supplement
c) Return
3) Plan
a) Versions
b) Overall and annual
c) Hierarchy versus detail plan
.
2.2 Key Assumptions

Projects are required only to support the capital planning and execution process (including the opex
portion of capital projects), in conjunction with the Investment Management module
Projects will also be used to represent marketing projects
No requirement for revenue-generating projects, or billing of any kind
The current approval process for specific capital projects will continue, using WEAs and approval
through the WEA Lotus Notes database

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Projects (capex) will be created manually in PS and assigned to positions (nodes) in the approved
investment program in the IM module
No requirement for networks
No requirement for scheduling

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3. Business Process Scenarios:

Plan versus budget

SAP distinguishes between the terms Plan and Budget in the following way.

The budget is the approved cost limit for a project. It differs from project cost planning due to its binding
nature. Whereas the project costs need to be estimated as accurately as possible during the planning phase,
the funds are predetermined as a budget in the approval phase. The budget is the limit set by management for
project costs over a certain period of time.

On the other hand, cost planning deals with the costs you expect to incur in connection with your project as it
is executed. Planning is generally synonymous with the concept of forecasting, in that is repeated periodically.

Cost planning has different aims at different stages of the project:

At the concept and rough planning stage, cost planning acts as the base for an initial cost
estimate.
At the approval stage, it can form the basis for the budget allocation.
During project execution, cost planning is used to monitor and control cost variances, actual
vs. plan

1. Budget

1.1. Time frame

Project budgets may be entered in annual buckets, or in a single, overall bucket for the entire life of the
project. Each budget profile must be configured to allow either Overall, Annual or both time frames.
1.1.1. Overall
Often, the Overall option is used in the early stages of the budgeting process when the timing by
year is still unknown to project managers.
1.1.2. Annual
As more detailed information is learned from planning the project, the Overall budget can then
be spread over time into Annual buckets. This is the lowest level of time granularity for Budget, it
cannot be entered by month.
1.2. Original budget
The budget is first entered as an original budget, representing the officially approved amount at the
beginning of the year, or budget cycle.
1.3. Budget updates
Changes can be made to the original budget for both the investment program budget and for the WBS budget
at any time (Supplements and Returns). These changes are managed as line items in the system. You can
display them as an explanation of the current budget. The system manages supplements and returns
separately from the original budget. Therefore, the system displays them separately in reports. This gives
much better visibility to budget changes than simply changing the Original budget amounts. At any point in
time, the Current Budget reported in standard reports is equal to the Original + Supplements Returns +/-
Transfers. It is recommended to use Budget Updates when changing Budget, rather than changing the
Original Budget.
1.3.1. Supplement
Represents an increase to the original budget.
1.3.2. Return

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Represents a reduction to the original budget.

1.3.3. Transfer postings
Budget values may be transferred from one investment position (or WBS) to another.
1.4. Manage from Investment Program or from WBS
Budget amounts can be managed either from the Investment Program or directly on the WBS investment
measures. However, any changes performed directly on the WBS elements are not reflected in the Investment
Program and therefore this practice is not recommended.
1.5. Budget capex and opex?
It is possible to use Budget and Availability Control on all WBS elements, whether they represent a capital
investment or operating expense. Initial inputs from the VFC business suggest that opex WBS elements will
not be subject to Budget and Availability Control, only capex WBS elements.
1.6. Availability control activation
When business transactions are entered that create costs on a WBS element subject to availability control
(such as posting an invoice), the system checks whether the available budget for the WBS element is
sufficient. The system uses the tolerance limits defined in Customizing for checks. Specifically, availability
control checks the distributable current budget against the assigned value (actual costs plus commitments).
Availability control can be activated either immediately when the WBS element is saved, or in background for
multiple projects. VFC wants to activate Availability Control immediately upon WBS creation.
1.7. Currencies
Budget may be entered in any one of the following currency types:
Controlling area
Object currency
Transaction currency
Input from the VFC business is to use Object currency (company code currency) for budgeting.
Plan
1.8. Time frame
Project plan values may be entered in annual buckets, or in a single, overall bucket for the entire life of the
project. Each planning profile must be configured to allow either Overall, Annual or both time frames.
1.8.1. Overall
Often, the Overall option is used in the early stages of the planning process when the timing by
year is still unknown to project managers.
1.8.2. Annual
As more detailed information is learned from planning the project, the Overall plan can then be
spread over time into Annual buckets. Plan values may be further spread into monthly (periodic)
buckets through Detailed planning (see below).

1.9. Detail
In the SAP Project System two reporting/planning databases are maintained:
Hierarchy: This database has no cost elements (G/L accounts) but instead uses value
categories to keep track of costs and revenues. Its main application is for operational users
such as project managers who are not interested in great accounting detail but prefer to work

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at a highly summarized level. Therefore, many cost elements are typically mapped into a
single value category. In general, this database is not interesting to financial analysts and
accountants, except for budget reporting since project budget is not managed at the cost
element level and is therefore stored in this summarized database. (Technically, this database
is represented in the RPSCO table). In Figure 1.0 below, the areas in pink represent the
hierarchy values.
Detailed (Cost element): The same database tables that hold actual and plan values by cost
element for cost centers also hold these values for projects. Therefore many standard reports
are available to display actual versus plan comparisons for projects and WBS elements.
Actual versus budget comparisons, however, must be drawn from the hierarchy reports.
In the standard SAP planning transactions for projects, either or both of Hierarchical and Detailed values may
be configured for use in planning. After the initial design session, the VFC business is still weighing the option
of allowing Hierarchy planning in addition to Detailed planning.

1.9.1. Hierarchy planning

This is typically used in the early stages of project planning when it is not clear exactly which G/L
accounts (cost elements) will be relevant for planning, nor what time periods will be involved.
1.9.2. Detailed planning
Detailed planning is performed when there is sufficient understanding of the necessary expenditures
to be able to plan by cost element and by time period (monthly planning buckets are available).
1.9.2.1. Primary costs
All costs other than costs arising from activity allocation are planned using the Primary costs
button in the standard planning transaction CJ40. Annual overview and period screens are
available. The cost elements available for planning are determined by configuration. There is a
requirement to use standard planning layouts in Excel for subsequent upload to SAP.
1.9.2.2. Activity inputs
Costs from activity allocation (such as labor charges) are planned using the Activity inputs
button in the standard planning transaction CJ40. Annual overview and period screens are
available. The activity types available for planning are determined by configuration. In the initial
phase of this implementation, internal labor charging using activity types is not required, therefore
this function will not be utilized for planning.
1.10. Versions
As many as 1,000 different plan versions may be configured for use in planning projects (and all other
Controlling objects such as cost centers). Actuals are always captured in plan version 000. The VFC business
has recognized a requirement to configure consistent plan versions for use across the enterprise for monthly
planning, as well as quarterly planning where it is done. After each monthly version is planned, it will be
locked.
1.11.Exchange rates
The exchange rate type to be used when planning in multiple currencies must be configured. Typically either
the P or M exchange rate types are used. Initial input from the business is to use the P rate for planning.
1.12. Currencies
Plan values may be entered in any one of the following currency types. The default currency must be
configured.
Controlling area
Object currency

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Transaction currency
Input from the VFC business is to use Object currency (company code currency) for planning.
1.13. Planning aids
1.13.1. Copy actual to plan
There is a requirement to copy actuals to various plan versions. No special configuration is required for this,
standard functionality exists.
1.13.2. Copy plan to plan
There is a requirement to copy values from one plan version to other plan versions. No special configuration is
required for this, standard functionality exists.

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Figure 1.0 Areas in pink represent Hierarchy planning, other areas represent Detailed planning

By year - Annual timing is known, and cost element detail

Cumulative = Sum of annual values (must be less than or equal to Overall value)
Overall 2008 2009 2010
Cost Cost Primary Activity Cost Primary Activity Cost Primary Activity
Schedule Schedule costs input Schedule costs input Schedule costs input

UP.400718 35,000 - 8,202 9,798 - 4,202 9,798 - 1,911 1,089

UP.400718.1
UP.400718.1.1
UP.400718.1.1.1

UP.400718.1.1.5 15,000 2,557 5,443 1,557 5,443

UP.400718.1.1.6
UP.400718.1.2
UP.400718.1.3

UP.400718.1.3.4 10,000 1,823 2,177 1,823 2,177 911 1,089

UP.400718.1.4
UP.400718.1.4.1
UP.400718.1.4.2

UP.400718.1.9.3 10,000 3,823 2,177 823 2,177 1,000

UP.400718.2
UP.400718.4
UP.400718.3

"Cost schedule" column displays same values as "Distributed" column

"Total up" function is automatic (rolls up lower levels to higher levels)
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3.1 Definitions, Acronyms, Terminology

IM Investment Management module
WEA Work Expenditure Authorization
PS Project System
AR Appropriation Request
AUC Asset Under Construction
OPEX Operating expense
CAPEX Capital expenditure

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4. Business Process Diagram

4.1 Process Diagram

The following tasks in the below diagram are relevant:

Distribute budget dollars to the investment order
Copy actual to plan
Copy plan to plan
Update plan (forecast)
Lock plan version
Update budget

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4.2 Activity List

Activities in the flow above relevant to planning and budgeting are detailed here:

Name Description Transaction Code, if Roles Regulatory

relevant involved /Other
Controls

Distribute original Original budget is IM52 Coalition

N/A
budget distributed from accountant
Investment Program to
Projects/WBS Fixed asset
(investment measures) accountant
Update project plan Re-forecast the planned CJ9B copy plan to plan Coalition
N/A
values costs for project based CJ9C copy actual to plan accountant
on latest information CJ40 manual planning
CJR2 Excel upload Fixed asset
accountant
Lock plan version Disable the plan version OKEQ GBT
N/A
from further changes Finance
Update project If necessary, increase IM30 (Supplement) Coalition
N/A
budget (supplement) or reduce IM38 (Return) accountant
(return) budget values in
IM Fixed asset
accountant

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4.3 Inputs

The Inputs needs to be specifically documented for the client specific situation, like interfacing with
external systems, workflow, form & Medium of communication.

Activity Type (email, form, Automatic/Manual Source Description

handoff, policy,
report, etc)
Capital Business sub- Manual Finance Preparation and
planning process approval of Capital Plan
in IM module

Creation of Business sub- Manual Finance Creation of Project/WBS

Project/WBS process using Project Builder

4.4 Outputs

The Outputs needs to be specifically documented for the client specific situation, like interfacing with
external systems, workflow, form & Medium of communication.

Activity Type (email, form, Automatic/Manual Target Description

handoff, Interface,
etc)
Budget report Report Manual Finance S_ALR_87013557
Plan report Report Manual Finance S_ALR_87013532

5. Process Variations
5.1 Business Unit Led Variations

N/A None Identified

5.2 Geography/Legal Entity Led Variations

N/A None Identified

6. Role Definition & Organizational Impact

The content in this section will serve as input for the training and performance support teams
deliverables.

6.1 Role/Skill Class Inventory

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Role Tasks Knowledge Key Transaction Code

Coalition accountant Distribute original budget SAP Investment Mgmt IM52

Update project plan SAP Project System CJ40 and CJR2

Update project budget SAP Investment Mgmt IM30 and IM38

Fixed asset accountant Distribute original budget SAP Investment Mgmt IM52

Update project plan SAP Project System CJ40 and CJR2

Update project budget SAP Investment Mgmt IM30 and IM38

GBT Finance Lock plan version SAP IMG for Controlling OKEQ

6.2 Organizational Impact

Note: Please see Organizational Impacts within the Project Share Drive.

7. RICEFW
(Note: Below are the RICEFWS discovered in the Blueprint Phase. A complete list of RICEFWs will be stored
in a central location. After the design phase, the list below should not be considered exhaustive as the
RICEFWs may change throughout discovery.

7.1 Reports

RICEFW # Report Description

N/A NONE

7.2 Interfaces (Inbound / Outbound)

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Direction
RICEFW # (Inbound / Interface Description
Outbound)

N/A N/A NONE

7.3 Conversions

RICEFW
Conversion Description
#

N/A NONE

7.4 Enhancements

RICEFW # Enhancement Description

N/A NONE

7.5 Forms

Client XYZ
Form Description
RICEFW #

N/A NONE

7.6 Workflows

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Client XYZ
Workflow Description
RICEFW #

N/A NONE

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8. Other Issues / Gap List

8.1 Other issues, Gaps, and outstanding points

Issue / Gap # Issue / Gap Description Impact Status Resolution

Open Issue VFC business is still weighing Open

the option of allowing
Hierarchy planning in addition
to Detailed planning. See
section 2.2

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